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The issue of unemployment and underemployment is endemic to all rural parts in the country. Each year we witness forced migration, some temporary and / or seasonal and the rest permanent, from rural areas to the urban centres. With this the strain on civic amenities in many urban centres is reaching a breaking point. To address this issue, the Indian Parliament passed the National Rural Employment Guarantee Act on the 7th of September 2005. With this the Government now guarantees to provide at least one hundred days of guaranteed wage employment in every financial year to every household whose adult members volunteer to do unskilled manual work. The Act is loosely modeled on the landmark Employment Guarantee Act of the State of Maharashtra. For actors in the social development sector this Act forms a good focal point of intervention with the poorest of the poor. Through this article I wish to touch upon some facets of the Act. I am also taking the liberty of pointing out some lacunae, strategies for implementation and means of strengthening.

What does the Act entail?

The explicitly stated objective of the Act is the ‘Creation of durable assets and strengthening the livelihood resource base of the rural poor’. The Act directs all state governments to develop appropriate scheme for its implementation, establish systems and take adequate administrative safeguards to prevent misuse.

The Act guarantees 100 days of work for every household. It specifies that the wages will not be less that Rs. 60/- per day. It lays special emphasis on the poorest of poor and women who, the Act specifies, must form at least 1/3rd of the beneficiaries. The Act specifies that at least 14 continuous days of work must be created. It also lists out in detail the facilities like crèches, drinking water, medical facilities, insurance cover for labourers etc. An interesting provision is an unemployment allowance for those who cannot be provided work in spite of a proper demand being made. The unemployment allowance has been pegged at 1/4th the wage rate (ie Rs. 15/- for the first 30 days) and then ½ the wage rate for the remaining period.

What are the advantages?

The advantages of the Act are evident. There have been myriad schemes in implementation for the providing employment to the poor. However, these have been more like dole. For the first time, government is accepting its liability of providing employment to the poor. It is saying that the poor have a right to be employed and that the State guarantees and reaffirms this right. For the millions of poor who have to migrate in search of work, this Act will be a relief. At least 100 days of employment can be obtained per family in non-agriculture season. A situation has been created where a family can hope to get employment for 8 months a year, 4 in the Kharif season and 4 through the NREGA.

Further the Act specifies that the work generated will focus on creation of durable assets and strengthening the livelihood base in rural areas. Apart from water conservation, drought proofing, afforestation, tree plantation and other works on public spaces, there is provision for developing irrigation facility on land owned by households belonging to SC/ST or those beneficiaries under the Indira Awas Yojana. That means that even marginal and small farmers (most SC / ST land holders fall into this category) can hope to develop irrigation facilities on their lands.

What are the lacunae?

While the potential of the Act is undoubted, there are some serious lacunae that have been left unaddressed or partially addressed by the Act. I will try and highlight some of these since these will affect how the Act is implemented

The opening line in the Act says at least 100 days giving rise to a feeling that more work is possible. The finer print of the text (Schedule II clause 5) however dispels all hope and mentions clearly that a household can expect a maximum of 100 days of work in a financial year.

100 days of work is assured for a household defined as the members of a family related to each other by blood, marriage or adoption and normally residing together and sharing meals or holding a common ration card. Development actors will be able to visualize the problems that are going to be faced by the second wives and their children, the nomadic tribes, the ‘criminal castes’ who don’t fit in neatly in any patterns.

The Act says that ‘As far as practicable, a task funded under the Scheme shall be performed by using manual labour and not machines’. Now this is a statement that leaves itself wide open to (mis)interpretation. Who is to determine what is practicable? What are the mechanisms of determining that? How does one prevent corruption and overuse of machines under the guise of practicability. In Maharashtra we see rich JCB owners getting paid while poor labourers stay idle.

The central and state government is to make budgetary provisions for the implementation of the Act. Now given the history of consistency of support to development programmes, this is scary. What happens if economic or political compulsions change priorities? Should we then allow this Act to meet the same fate as thousands of other schemes which are announced but never budgeted for?

Though the minimum daily wage rate is specified in the Act to be rupees sixty, it is interesting that Orissa which is one of the first States to develop its own Scheme based on the NREGA has decided that the wage rate will be Rs. 52.50/- and not Rs.60/-.

One of the biggest lacuna is that work is to be demanded by developing projects at the village level. The Act clearly states that the Gram Panchayat shall be responsible for identification of the of the Gram projects in the Gram Panchayat area to be taken up under a Scheme as per the Panchayats’ recommendations of the Gram Sabha and the Ward Sabhas and for executing and supervising such works. Given the state of the capacities of the Panchayat and the poor in these, how can one realistically expect that the Panchayat will plan? Are we not leaving the door wide open for middlemen to come into the picture and a backyard industry coming up for ‘developing gram projects’.

How does the Act compare with the Maharashtra EGS?

The Maharashtra EGS is one of the best crafted and unique pieces of legislation in the world. It is no wonder that it is one of the most studied and discussed Act. The Act was developed on the back of one of the severest droughts that hit the state of Maharashtra in 1972. The NREGA has come into existence 29 years after the Maharashtra EGS. The NREGA draws upon the Maharashtra Act but there are some areas where the latter is decidedly better.

The Maharashtra EGS does not place any limitation on number of days of work that is guaranteed. It is a popular misconception that work is guaranteed only in the non agricultural season. It is not. Work is guaranteed all year around. In fact the wage rates in the Act, normally set slightly below market rates, make it self targeting. No labourer who can get work at market rates is likely to demand work under the EGS.

There is no call on planning and project development at the village / worker level. All that a worker has to do is demand work and the government is forced to provide the same.

In case government is unable to provide work, the unemployment allowances that have to be paid, come from the salaries of the District Collector! This can be a very effective deterrent and a goad for the administration to work.

The best aspect of the act is the sense of poetic justice. The funds for the EGS come primarily from the professional tax that is paid by all persons who are gainfully employed in the state as well as all corporations with offices in the state. Those who have work support those who don’t. This also makes the EGS self-financing and non-dependent on the political or economic necessities and uncertainties.

The fund that is created for the EGS cannot in any way be used for other work. No diversions or reallocations are possible. This is how even the cash strapped State Government is unable to use the Rs. 11,000 crores plus that are earmarked for EGS. On occasion the best efforts of the government to use the funds elsewhere have been foiled by the judiciary that has correctly interpreted the Act and the spirit behind making this provision.

As far as Maharashtra is concerned the NREGA represents a retrograde step. Some of the areas where the State EGS is better have been outlined above but most striking is the significant dilution of the right to employment of the poor in the NREGA. Under the Maharashtra EGS a poor couple is theoretically guaranteed 624 days of work in a year (assuming work for 6 days a week for both for 52 weeks a year). The NREGA guarantees only 100 for that couple.

At the present juncture it is not clear what the stand of the Maharashtra government will be. It is evident that some action will be taken soon. This is a significant intervention in the state and already merits a full cabinet rank minister in charge.

This is the time for Civil Society Organizations in Maharashtra to be on their toes. They need to guard against all attempts at dilution of the EGS. This is a distinct possibility. After all this has already been tried by the government through the ‘EGS rejuvenation committee’ recommendations last year.

Maharashtra should look at the NREGA to supplement the EGS rather than replacing it. That is a perfectly acceptable scenario since it presents an additional option to the poor.

How can Civil Society Organizations (CSOs) use this Act?

Whatever the situation in Maharashtra, the Act can and should be effectively used in other States. However, before getting down to using the NREGA act, it is necessary for social action groups to study the Act. Very often this is were CSOs fall short and are therefore unable to use the power unleashed by legislation. The NREGA offers a chance for CSOs to go to the poor with concrete benefits. If wisely used, it can be a good tool to mobilize the poor and build their capacities.

There is no doubt that NREGA will offer relief to the millions of suffering poor in the country. It must be seen in that light and put to use. However, in my opinion, neither government nor CSOs should ever forget the fact that the NREGA and other such schemes can, at best, be temporary solutions. After all why should the poor be expected to live on some sharecropping, some private labour and labour under the NREGA which will fetch them Rs.6000/- per year per family? Why should they not be looking at sustainable livelihood mechanisms that will enable them to stay clear from the dole?

I feel that there is something undignified about being beneficiaries of a government scheme. Ask a woman who is a beneficiary of the Sanjay Gandhi Niradhar Yojana whether she is happy and the answer will always be NO. She would rather have a source of livelihood or a family support mechanism that allows her to live with dignity. Let us not forget that life with dignity for all should be our ultimate goal.