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Rural job plan turns 5, but wages need to grow more

The Mahatma Gandhi National Rural Employment Guarantee Act, UPA’s flagship aam admi scheme, turns five on Wednesday.

delhi Updated: Feb 02, 2011 00:50 IST
Prasad Nichenametla

The Mahatma Gandhi National Rural Employment Guarantee Act, UPA’s flagship aam admi scheme, turns five on Wednesday. However, more than 30% of the rural India working under the right-to-work act would continue to receive wages below the guaranteed minimum as per the minimum wages act.

On January 14, the ministry of rural development issued a notification revising the wage rates under the MNREGA from Rs 100 per day to between Rs 117 and Rs 181 (17-30 % hike) in different states.

The revision under Section 6(1) of the 2005 Act, coming in wake of inflationary pressures on the poor, adjusts the wages by indexing it to the Consumer Price Index of Agricultural Laborers (CPIAL).

Court cases aside, the question of how much the rural poor should be entitled to under MNREGA led to a standoff between the PM and UPA chairperson Sonia Gandhi in late 2010. While Gandhi, who also chairs the NAC, advocated NREGA wage linkage with statutory minimum wages, the government, under Manmohan Singh, preferred the CPIAL calculation.

Though the ministry claims the revision takes NREGA wages above the minimum wages in 26 states and Union Territories, analysis by HT - going by present trend of demand and employment provided in the states - shows the other eight states that continue getting less than minimum wages constitute 1.3 crore households or 31% of the total 4.1 crore households provided work till now this fiscal (latest as per NREGA website). The percentage also reflects demand from these states.

The eight include smaller states such as Goa and Mizoram, which have fewer number of workers under the scheme.

But, the states also include the two showpieces under MNREGA — Andhra Pradesh and Rajasthan — that brought in reforms like social audit, post office-bank payments into the mother of all schemes with a budget allocation of Rs 40,100 in 2010-11.

While minimum agricultural wage rate is R135 and R125 in Rajasthan and AP, the revised NREGA wage in these States is only Rs 119 and Rs 121.

Though numerous villages like Saru in Udaipur district of Rajasthan, have benefited from MNREGA, the average they receive is under R100 a day forcing ones like Govind Meena (30) go in search of work as far as Ahmedabad, Surat where he gets Rs 200 to Rs 250 per day. “NREGA is only for 100 days at the most and pays much less than what I earn there,” he says.

Kerala, Karnataka, Punjab, Goa, Arunachal Pradesh and Mizoram are the other states where the new NREGA wages are lesser than prevailing minimum agricultural wages under the Minimum Wages Act 1948.

Civil society groups and jurists have lambasted the government move as a violation of legal and fundamental provisions. Additional solicitor general representing the government Indira Jaising submitted before the Supreme Court that payment of wages below minimum wage would amount to forced labor. The AP high court earlier stayed the notification of wage rate of Rs 100.

“We operated within the provisions of the MGNREG Act which permits us to fix wages irrespective of what other laws say,” a ministry official said, adding the expenditure is more under the present head.

“Instead of arbitrary calculations connecting the questionable base rate of Rs 100, why not link NREGA wages to statutory minimum wages as fixed by the states according to local needs?” says Nikhil Dey of Mazdoor Kisan Shakti Sangathan.

According to MKSS, linking with minimum wage act only costs the Centre an additional Rs 1254 crore.