A case for an urban MGNREGA

| Updated on May 27, 2020

The urban poor have been hit harder than their rural counterparts by Covid, but policy attention is missing

The case for an urban livelihood guarantee scheme on the lines of MGNREGA has never seemed more compelling. Even if one sets aside the argument on whether the cash transfers announced recently (the food-grain component is generous, but largely limited in reach to those who have ration cards) are enough to see the poor through these trying times, a more remarkable fact has come to the fore. Thanks to MGNREGA, which has served to provide some sort of subsistence income to the rural poor and landless, and State-level schemes such as Rythu Bandhu for the peasantry (on which the PM-KISAN is modelled), there is a semblance of a social safety net for the rural population, however inadequate its scope. But for the urban working poor, those who have left rural India in search of better opportunities, there is nothing to fall back on in an emergency. This would not have seemed so obvious at a time when the economy was doing well. A combination of MGNREGA and the construction boom in urban areas kept wages, on the whole, rising. Urbanisation has also led to a demand for services provided by the ‘gig economy’. These incomes have propelled a remittance economy in rural India, while fuelling a low-cost production and services economy in urban centres. This ecosystem and the livelihoods linked to it have come unstuck with the lockdown, simply because there was nothing for urban migrants to fall back on. They have been forced to migrate, because cities had not planned for their sustenance.

A BusinessLine article based on an NCAER study (‘Urban poor need better relief measures’, May 24) points out the imbalance in welfare delivery between rural and urban areas. Collecting data from a wide sample of households in Delhi and adjoining States on how effectively the cash and food transfers recently announced are working, it found that more families in the rural areas (52 per cent) received extra rations compared to urban areas (42 per cent). The exodus from cities is perhaps also being driven by the prospect of migrants securing extra food grains in their villages. The need for a one-nation-one-ration-card scheme that works in urban areas and an urban job guarantee programme cannot be wished away.

For all its implementation issues, the MGNREGA does provide succour when it matters, because it is a demand-based programme. While the Finance Minister has done well by ramping up its allocation by ₹40,000 crore, she should also implement urban works at the earliest on the same lines — as a self-selection scheme. Just as the demand for MGNREGA work in rural areas has risen sharply in May, it will be a huge draw in urban centres. Together, this could form some sort of a universal basic income, which is sorely needed. The trauma of reverse migration can be contained.

Published on May 26, 2020

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