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LATEST NEWS UPDATES | Economists ask PM not to dilute NREGS, Gadkari says focus on needy areas -Vivek Deshpande and Surabhi

Economists ask PM not to dilute NREGS, Gadkari says focus on needy areas -Vivek Deshpande and Surabhi

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published Published on Oct 15, 2014   modified Modified on Oct 15, 2014

-The Indian Express

As leading economists urged the Prime Minister not to dilute the Mahatma Gandhi National Rural Employment Guarantee Scheme saying it provides economic security to millions, Union Minister for Rural Development Nitin Gadkari justified the Centre's decision to restrict the focus of the job scheme to the "most backward and needy" districts and reduce the labour-material ratio from 60:40 to 51:49.

Denying any move to reduce compensation for lack of job availability or any delay in payment of wages, Gadkari told The Indian Express: "In many irrigated states like Punjab and Haryana, lack of labourers for farming operations has become a major problem. They have to get labourers from Bihar. In Uttar Pradesh, they don't have labourers to work on cane farms. So, we have thought of implementing the scheme more intensivel where people have no jobs available."

On the strategy for ‘non-focus' districts, Gadkari said: "We will have a different thought for exceptions and will use the Planning Commission data on such areas."

On the issue of labour-material ratio, he said: "It (the decision) has been taken keeping Parliament in confidence and all parties have supported it. We wish to spend the money constructively and we need to do some value addition. After all, it's government money."

Citing an example, he said: "In east Vidarbha, there are over 7,000 old reservoirs called Malgujari talaos. We need to desilt these. So, we have to reduce the ratio there."

He made these remarks after \28 economists wrote to Prime Minister Narendra Modi. "We are writing to express our deep concern about the future of India's NREGA," their letter stated.

Signatories included Jean Dreze, a member of the erstwhile National Advisory Council; Abhijit Sen, former member of the Planning Commission; Dilip Abreu, professor of economics, Princeton University; Pranab Bardhan, emeritus professor of economics, University of California, Berkeley; Anirban Kar, associate professor, Delhi School of Economics; and, Jayati Ghosh, professor of economics, Jawaharlal Nehru University.

The letter argued that capping the job scheme to 200 districts, restricting state spend and revising the labour-material ratio would dilute its benefits.

Pointing out that the scheme, started in 2005 by the UPA with cross-party support, had achieved significant results, the economists said: "At a relatively small cost (currently 0.3 per cent of India's GDP), about 50 million households are getting some employment at NREGA work sites every year. A majority of NREGA workers are women, and close to half are Dalits or Adivasis. A large body of research shows that the NREGA has wide-ranging social benefits, including the creation of productive assets."

The economists expressed concern over plans to restrict the ambit of the scheme to just 200 districts, arguing that it goes against the basic premise of the Act.

They argued that wages under the scheme have been frozen in real terms while delay in payments have further depleted their real value.

"The Act's initial provisions for compensation in the event of delayed payments have been removed. The labour-material ratio is sought to be reduced from 60:40 to 51:49 without any evidence that this would raise the productivity of NREGA works," the letter stated.

They also noted that by imposing caps on NREGA expenditure on state governments, the Centre is undermining the principle of work on demand.

 


The Indian Express, 15 October, 2014, http://indianexpress.com/article/india/india-others/economists-ask-pm-not-to-dilute-nregs-gadkari-says-focus-on-needy-areas/99/


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