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Home > Business > Business Headline > Report

Rural job guarantee scheme an eyewash?

Rediff Business Desk | September 21, 2007 11:59 IST

The National Rural Employment Guarantee Scheme is neither national, nor does it guarantee anything: that, in sum, is the finding of a study conducted after the scheme, put in place by the National Rural Employment Guarantee Act of 2005, has completed a little over a year in operation.

The scheme, with a budgetary allocation of Rs 11,300 crore (Rs 113 billion) in its first year, was made effective February 2, 2006, across 200 districts in 14 states across India. In the current financial year, the scheme has been expanded to 330 districts, and the budgetary provision enhanced to Rs 12,000 crore (Rs 120 billion).

In essence, the scheme seeks to guarantee a minimum of 100 days of employment to at least one member of each family, in each of the selected districts.

In practice, however, only 6 per cent of households registered under NREGS achieved that target, according to a study by the Society for Participatory Research in Asia.

The survey, conducted in 21 sample districts across 14 states (Andhra Pradesh, Bihar, Chhattisgarh, Gujarat, Haryana, Himachal Pradesh, Jharkhand, Kerala, Madhya Pradesh, Orissa, Rajasthan, Uttarakhand, Uttar Pradesh, and West Bengal), examined the period April 1, 2006- March 31, 2007.

It found that four out of the 14 states -- Bihar, Gujarat, Haryana and Orissa -- had not even constituted the State Employment Guarantee Council, the mandatory first step towards implementation of the scheme.

The survey found that while gram panchayats were given the responsibility for implementation, that additional responsibility was not matched by devolution of functions, funds and functionaries needed to carry out the work. Fully half the panchayats in the surveyed districts do not have Employment Guarantee Assistants to oversee the work.

Ignorance of the nature of the scheme is another factor hampering effective implementation. The survey found that in the 530 surveyed villages, only 45 per cent of registered households had asked for jobs, and only 27 per cent of these had been given official receipts indicating that the administration is aware of the requirement.

These factors negate the basic premise on which the scheme is structured: that an awareness of individual rights, and an official appreciation of individual needs, would fuse into an assurance of employment.

The scheme further postulated that any family asking for employment under the scheme would be helped out within 15 days of applying. In practice, however, the survey found that only 44 per cent of registered households (which itself, as pointed out earlier, is less than half the total eligible households) got employment within the stipulated time. Again, as pointed out earlier, only six per cent of such households received employment for the mandatory 100 days.

While such delayed allocation is negating a major objective of the Act, namely to reduce rural distress, the survey further found that the promised unemployment allowance, to be given to those who could not be provided employment within the prescribed time frame, has also not been disbursed.

In those cases where employment was in fact given, a little under half (42 per cent) of the beneficiaries reported that the wages were less than the minimum prescribed for agricultural labor in the state.

Further, over half (54 per cent) of registered households surveyed by PRIA said payments for work done were not made within the prescribed 15 days -- a crippling blow in rural areas, where the people do not have the financial back up to enable them to await payment.

The result is that rather than seek employment under NREGS, people are increasingly seeking work outside the system, since they are at the least assured of getting their wages on a daily basis.

In sum, the situation is thus: firstly, the registration process is difficult; secondly, even when you do register, less than half the number get employment; even when you get employment, less than half the beneficiaries find work in the prescribed time frame; among those who do get work, the pay is less than the prescribed minimum and this pay is often delayed; among those who have registered but not found employment, the unemployment allowance that was promised has not been given.

This situation has created a knock-on effect, with the intended beneficiaries losing enthusiasm for and interest in the scheme; where the relieving of rural stress was the stated objective, disillusionment has been added to distress - all this at the expense of over Rs 11,000 crore.

The study recommends among other action points that the procedure be standardized, that a social audit needs to be instituted, that more manpower should be deployed to ensure speedy implementation, that accountability be introduced in the form of mandatory Action Taken Reports to be filed by the gram panchayats, and that these local bodies be given the administrative help required for effective implementation of the scheme.