NREGA scheme is not broken, so govt need not fix it | comment | Hindustan Times
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NREGA scheme is not broken, so govt need not fix it

comment Updated: Oct 16, 2014 00:38 IST
Hindustan Times

If the news reports doing the rounds are to be believed, the NDA is planning to further dilute the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), the country’s single-largest flagship programme that has a budget of Rs 34,000 crore for 2014-15. While most governments when they come to power do tinker with schemes launched by their predecessors — the MGNREGA was the UPA’s pet scheme — this is one programme that the NDA should not tamper with. As several top-notch economists have said in an open letter to the government, the MGNREGA provides much-needed “economic security to the lives of millions of people who are on the margin of subsistence”.

They added that at a relatively small cost (currently 0.3% of India’s GDP), about 50 million households are getting some employment at MGNREGA worksites every year. More important, a majority of MGNREGA workers are women, and close to half are Dalits or Adivasis, the sections that are at the bottom of our socio-economic pyramid. A large body of research shows that the MGNREGA has wide-ranging social benefits including the creation of productive assets. While it is true that there have been serious allegations of corruption against officials running the programme, as the years have progressed, research shows that corruption levels have steadily declined.

Alarmingly, the central government is now planning to change the labour-material ratio from 60:40 to 51:49 without any evidence that this would raise the productivity of MGNREGA works. This means that if Rs 100 is being spent on a work, then Rs 51 will be spent on wages and Rs 49 on the material required for construction.

This increase in expenditure on material will open the flood gates for the entry of the construction lobby, which could lead to siphoning off of funds. Second, the Centre appears to be considering an amendment aimed at restricting the MGNREGA to the country’s poorest 200 districts. This will completely alter the DNA of the rights-based Act and its fundamental premise: Gainful employment that affords basic economic security is a human right. The entry of the contractor lobby would also mean the involvement of machines to build non-traditional structures when traditional structures can suffice provided there is proper maintenance.

The MGNREGA was enacted in 2005 with support from all political parties including the BJP. The government must stick to that decision and instead of diluting the Act, it should ensure that it becomes stronger and the leaks are plugged so that it can justify the amount that is being spent on it. And it should take pride in the fact that the poor get the most out of it.