NREG Act

The NREG Act 2005 provides enhancement of livelihood security, giving at least 100
days of guaranteed wage employment in every financial year to every household, whose
adult members volunteer to do unskilled manual work. Panchayats at districts,
intermediate and village levels will be the principal authorities for planning and
implementation of the scheme.

The NREGA has been extended to all the 600 districts in the country. The extension has
been expedited, though. It might have been a political decision, but it cannot be objected
to on that count. The only possible point against it in principle could have been the
additional financial burden involved; but it should not be a major issue at this point for
two reasons.

First, a programme of this kind, if administered well, would be exactly the antidote to the
‘jobless growth’ problem. There is growth that is not percolating down to the poor, tax
revenues are booming, and the best use of available public resources would be to provide
jobs to the poor. Second, the additional expenditure should not be too large since the
budget did provide a tidy sum for the implementation of SGRY (Sampoorna Grameen
Rozgar Yojana) in the non-NREGA districts; NREGA is likely to effectively replace
SGRY in those districts.

There are a few caveats, however. Being the ‘flagship’ scheme of the present government,
it is sometimes being pushed too much. There are areas where market wages are higher
than the wage rate fixed under the programme; such places would naturally exhibit little
demand for it. But the strong pressure exerted to show ‘good results’ is a sure recipe for
misutilisation of funds. The happiest situation would be when no one would require jobs
under this scheme.

Since this is a demand-driven programme, targets should be a no-no unless they can be
scientifically tailored to specific areas. Further, despite stronger safeguards, as compared
to the earlier employment programmes, there are reports of inadequate awareness or
implementation, as also leakage. These problems have to be looked into in detail and the
loopholes plugged.

Finally, and this point has often been made, NREGA requires greater administrative
efforts as compared to the earlier schemes, particularly at the level of PRIs (panchayati
raj institutions) that are responsible for the final implementation, and hence the funds set
apart for the purpose are quite inadequate. This genuine problem must be attended to.

Whether it was “an unofficial proclamation of elections” or a “graduation gift” or

“wastage of money” or “revolutionary act for the poor”, there is no doubt that the
announcement of the extension of National Rural Employment Guarantee Scheme
(NREGS) to the entire country is a welcome step. But the manner in which it was done
exposes the Congress party’s attempt to derive political mileage out of it. Wasn’t the
government supposed to extend it to all the districts anyway over a period of five years?

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However, the expenditure of Rs 4,385 crore against the actual allocation of Rs 12,000
crore (current fiscal year) is an indication that the administrative machinery is not geared
up to meet the challenge. This low level of expenditure has given an opportunity to the
finance ministry to oppose the budget allocation. This is a paradox where victims are
punished instead of checking the vested interests blocking the scheme.

The allocation of a mere Rs 20,000 crore for 600 districts is one sure way to sabotage the
scheme. Certain measures adopted by the government and the way the state has used the
flexible provisions of the Act to suit its ends gives ground to challenge the government
intentions. It has often cited lack of demand from labourers (roughly 2.65 crore
households), but has rarely taken action on the reluctance of the local authority to register
the demand of labourers, especially women, to seek jobs.

NREGA becomes redundant when actual choices are denied to people. The Act’s
emphasis on people’s participation is not realised when people are not only turned away
but face repression for fighting for their rights, when job cards and muster rolls are
fudged and funds siphoned off. On the other hand, administrative costs are rising (Rs 753
crore annually).

Regular employment at a minimum wage is still the dream and the first demand of the
poor. Though half-hearted, this extension has the potential to change the consumption
power and share of rural economy, increase the bargaining power especially of women
workers, finally leading to a change in the power equations in rural India — towards a
more equitable socio-economic order.