The Hindu Business Line : NREG Bill: Fine-tuning will make it work better

The National Rural Employment Guarantee Bill goes beyond describing a set of employment generating schemes, and goes into the nitty-gritty, listing the broad responsibilities of the officials at the district, block and panchayat levels. Tweaked slightly and implemented as an Act, it can over time evolve into a means of rapid, all-round infrastructure development in rural India, says Bhanoji Rao.

EVEN if rapid economic growth has the benefits of resulting in employment generation and poverty alleviation, one would have to prepare for the worst at all times since practical life is far more complicated. The events of the last week of last year have amply demonstrated this; the devastation from the tsunami has caused trauma of the worst kind to tens of thousands in the country's affected areas.

Here is a lesson perhaps to learn in the matter of creating and maintaining a certain type of infrastructure in the rural tracts — schools and houses that are all-weather shelters and rural health centres that can tackle such emergencies. The National Rural Employment Guarantee (NREG) scheme forming part of the legislation in the offing could just be the right initiative to develop such infrastructure.

Towards the close of 2004, On December 21, the Union Government introduced the National Rural Employment Guarantee (NREG) Bill, 2004 in the Parliament.

The Bill seeks to provide job security to the rural poor by giving at least 100 days of guaranteed wage employment every financial year to every household whose adult members volunteer to do unskilled manual work. Tabling the Bill, the Union Rural Development Minister, Mr Raghuvansh Prasad Singh, said it would go a long way in benefiting poor families in rural areas.

It is anticipated that during a period notified by the Centre, the State governments will provide employment to those among the rural poor volunteering to do unskilled manual work. It is expected that, within six months from the commencement of the legislation, State governments will prepare a scheme to give effect to the proposed guarantee.

A Central Employment Guarantee Council and State Employment Guarantee Councils in all the States where the legislation is made applicable will be constituted for review, monitoring and effective implementation.

The NREG Bill provides for establishing a National Employment Guarantee Fund and a State Employment Guarantee Fund to implement the employment guarantee scheme. Resposibility for implementation of the scheme rests with the standing committee of the District Panchayat, District Programme Coordinator, Programme Officers and the Gram Panchayats.

Wages will be earned for each day of work by those working under the provisions of the legislation. The Bill states that the wage rate will be specified by the Centre, but until such time, the minimum wage rate fixed by the state governments under the Minimum Wages Act, 1948, for agricultural labourers will be applicable.

The Bill specifies that if the applicant is not given work within 15 days of receiving his or her application, then the person will be entitled to a daily unemployment allowance from the State.

While the aforementioned provisions are from the Bill, there is also in the public domain a draft prepared by `concerned citizens' (hereafter referred as the CC Draft), and with that as the basis, one could read on the Internet the excellent text entitled Employment Guarantee Act: A Primer.

Significantly, the Primer explains why an Act is far more desirable than a set of employment generating schemes. It goes into the way the employment guarantee programme works, listing the broad responsibilities of the officials at the District, Bloc and Panchayat levels.

For instance, the Gram Panchayat will be responsible for registering all potential workers, issuing job cards to them, receiving their applications for work, forwarding these to the Block Officer, and informing the applicants as and when work is available. The Panchayat also plays a crucial role in the implementation of projects taken up under the Programme.

The CC Draft envisages the provision of work for anyone seeking it, as long as he/she is ready to do casual manual labour at the statutory minimum wage. This guaranteed employment would somewhat automatically lift people out of poverty and notably raise the economic independence of the vulnerable sections, especially unemployed and underemployed women.

This would indirectly help people to stay put and work in rural areas and thus reduce the pressure on urban areas, in general, and on the creation and growth of slums, in particular. While the CC Draft places no restriction on the number of days a person could work, the NREG Bill has a ceiling of 100 days of work.

On the kinds of work that are likely to be taken up under the Act, the Primer points out that while the nature of work is bound to vary from region to region, potential for labour-intensive work exists in the field of environmental protection: watershed programmes, rainwater harvesting, land regeneration, prevention of soil erosion, restoration of tanks, protection of forests, wasteland development, and related activities.

"Over time, with a large number of jobs to be created, the Employment Guarantee Programme is likely to evolve as a means of rapid all-round infrastructure development in rural India."

The Primer provides a cost estimate of Rs 100 per day for an estimated 4 crore households below poverty line and, hence, a total expenditure of Rs 40,000 crore for 100 days of employment for 4 crore persons. The total expense of the programme is just about one per cent of GDP.

What, then, are the modifications that one must seek in the Bill tabled in Parliament? One obvious modification is to make it applicable to anyone seeking work, regardless how many more hands might be willing to work.

The second and most important aspect that needs to be included in the Act and the actual programme is the need to limit the work to a minimal number of well-defined and well-designed public works programmes. At present, the works identified for providing employment include water conservation and harvesting, drought-proofing, irrigation canals, including micro and minor irrigation works, renovation of traditional water bodies, including desilting of tanks, land development, flood control and rural connectivity.

These are all activities where monitoring progress on the physical dimension is relatively difficult. In addition, it might be difficult to accurately match physical progress with recorded expenditures. On both counts, there may be difficulties in achieving the much desired transparency and accountability.

Under the main tasks to be carried out in NREG, it is best to include the construction or reconstruction of primary and secondary schools and primary health centres as well as construction of durable rural housing. They should all be as per standard designs and, hence, the matching of achievements and expenses would be far easier than any bureaucratically designed monitoring mechanism could boast. The very standardisation of design and the execution of thousands of structures with the common designs would give a positive feeling about the NREG, since the achievements will be visible on a wide canvas.

Fine-tuning the NREG Bill, with inputs from the provisions envisaged in the CC Draft, which enshrines the principle of guaranteed employment, would create a universal entitlement framework, free from political interference.

(The author, formerly with the World Bank and the National University of Singapore, is Professor Emeritus, GITAM Institute of Foreign Trade, Visakhapatnam. He can be reached at bhanoji@vsnl.net)

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Delivery mechanism in commodity exchanges — Strong link with price discovery

Bonding with Malaysia

From IT Inc to Pharma Inc

Data protection demystified

NREG Bill: Fine-tuning will make it work better

A copybook diplomat

Quota regime

Exact predictions