30 Under 30 2020

The Unfinished Agenda

Development economist Jean Dreze, an Indian of Belgian origin, was a key influence in the original design of National Rural Employment Guarantee Scheme (NREGS). Here, he talks about the idea behind the scheme and the loopholes that need to be plugged

Published: Jul 20, 2009 06:50:00 PM IST
Updated: Jul 30, 2009 02:36:28 PM IST

What led to the idea of National Rural Employment Guarantee Act (NREGA)?
There are two important ideas behind NREGA. One is that assured employment is an important form of social security for a country like India. In Western countries, social security is based mainly on unemployment allowances, something that would be difficult to do in a country like India.

But there is a rich experience of social support through public works programmes in India, especially in the context of drought relief in states like Rajasthan and Maharashtra. NREGA builds on this experience of employment-based social assistance.

The other idea was to place employment schemes in a rights framework. One that gives legally enforceable entitlements and enables people to put pressure on the system to deliver on matters such as employment on demand, payment of minimum wages and so on. This process has been very crucial for the success of NREGA.

Why was there a need for NREGA?
The need for social assistance cannot be denied. More so now, when the Indian economy has been growing very rapidly with increasing inequalities… because a lot of this growth is going to the richer sections of the population. There is an urgent need for some kind of redistribution mechanism in the economy and NREGA serves this purpose very well.

What is the central idea behind NREGA? Is it providing social security or is it providing employment?
It is more than both. Although NREGS is primarily aimed at providing social security, it is not just about income support. Fundamentally, it is a multi-purpose programme aimed at creating productive assets, empowering women, reviving the local economy, strengthening institutions of local self governance, reducing distress migration and protecting the environment, among other goals. It is important to see the multi-purpose aspects of the programme.

This is one reason why NREGA is significantly different from schemes of cash transfers which are sometimes advocated as an alternative. If it was only a matter of income support, then there might be an argument for cash transfers, but when you acknowledge the multiple purposes of the programme, I think the case for NREGA becomes much stronger.

The performance of the NREG Scheme (NREGS) has been varied over the states. There are many examples of non-Congress ruled states performing better. Similarly, one finds that many states, like Uttar Pradesh or Bihar, which rank low on social-economic development and are expected to make better use of NREGA, haven’t really done so. How do you explain the variance in performance across the states?
I don’t think there is a simple correlation between the ruling political party and the quality of implementation of NREGS. For each party, we can find some of the states governed by them doing well and some others doing not so well. For example, BJP has done well in Rajasthan but not in Gujarat. Congress has done well in Andhra Pradesh but not in Maharashtra and CPI (M) has done well in Tripura but not in West Bengal. So, there is no simple association.

But there is an issue of preparedness of the system. Rajasthan has benefited greatly from a very long experience of implementing drought-relief programmes, almost every year for more than a century.

Then of course, there are issues of local politics which are not connected in a simple way with political parties. The fact is that some states showed a strong commitment to NREGA early on, owned the programme and tried to make it work, for instance Andhra Pradesh and Rajasthan. Some states initially had no interest and more or less rejected the programme, like Uttar Pradesh and Jharkhand. These are also states that have high levels of corruption and poor governance. These factors are obviously big hurdles in the implementation of a complex programme like NREGS.

But over time most state governments and political parties learned to recognise the value of the programme and its popular appeal. So, we are beginning to see a convergence in terms of political interest in the programme.

Overall, are you happy with performance of NREGA?
I don’t think my happiness matters. I'll be happy when the workers are happy. And I don’t think they are happy yet, even though NREGA has wide popularity.

The last few years were bound to be a learning phase. And it has led to major improvements in the implementation of public works programme across the country. As long as there is sustained improvement, there is hope in the possible success of NREGA.

Of course, the standards of implementation are still very low in many states and to varying extents in almost all states. But the experience of the last few years has confirmed the fundamental soundness of the programme and the possibility of implementing it in letter and spirit. And where this has happened, NREGA has made a big difference to people’s lives.

You have travelled across the states and witnessed ground level implementation of the scheme. As the UPA government starts another term, what are the main lessons?
The most important thing to focus on at this time is the need for stronger grievance redressal mechanisms. The whole vision of NREGA will collapse if people have no means of enforcing their entitlements under the Act, whether it is the right to work on demand, or to minimum wages, or to payment within 15 days. Unfortunately, all the grievance provisions of the Act have been quietly sidelined. For instance, with rare exceptions, the unemployment allowance has never been paid, penalties have never been imposed on officials who don’t do their duty and workers have never received compensation for delayed wage payments — all of which are mandatory under the Act. Neither the central government nor the state governments have shown much interest in making themselves accountable to the workers.

So, taking grievance redressal seriously is an important part of the unfinished agenda of NREGA. For example, there have been massive delays in wage payments in recent months, but people don’t know what to do and where to go when there are delays. Under the Act, they are entitled to compensation of up to Rs. 2,000 if wages are not paid within 15 days. We were able to activate this compensation clause in one isolated case in Jharkhand, but this should actually become the routine. The state governments get away with long delays because the compensation clause has been quietly ignored. Workers are certainly not aware of it.

How do you ensure that grievance redressal is taken seriously?
It is the government's responsibility under the Act to formulate and enforce strong grievance redressal rules, including, for instance, penalties against officials who don’t do their duty. It is also important to create greater consciousness about legal rights among NREGA workers because they have the strongest stake in fair implementation of the Act. For example, before, NREGA minimum wages existed only on paper. In reality they were never paid. Now, the payment of minimum wages is becoming a matter of routine because NREGA workers are not willing to take less. So, this is one area where workers’ awareness has helped. The same can happen with other entitlements, including for instance, basic facilities at the worksites.

What about monitoring NREGS?
The Act includes certain provisions for independent monitoring but they have been quietly ignored. For instance, the Central Employment Guarantee Council was supposed to act as a national watchdog for NREGA, with a substantial degree of autonomy, wide powers and a broad mandate. But, in fact, the council is treated as a toothless advisory body. So, it has been very ineffective.

At the moment, most of the feedback comes from the official monitoring and information system, which is very useful but has severe limitations. It is just a compilation of official statistics, which needs to be validated through independent investigations such as household surveys and worksite inspections. Again, there are provisions for this in the law, but they haven’t been taken seriously.

Show More
Post Your Comment
Required, will not be published
All comments are moderated
  • Moitri

    There are many expectations from NREGA among the rural population but their expectation depends on the level of implementation which still remains a big question.Although NREGA is doing well in Rajasthan,what about the north east states where people doesn't know they have the right to ask for work.Now the UPA government should check the loopholes and make it a tool for one more time for the next election.

    on Jul 21, 2009
A Ticket to Better Education
Recession's Impact on Family Income