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LATEST NEWS UPDATES | MGNREGA recast to focus on welfare by Urmi A Goswami

MGNREGA recast to focus on welfare by Urmi A Goswami

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published Published on Sep 2, 2011   modified Modified on Sep 2, 2011

The government will recast the Mahatma Gandhi National Rural Employment Guarantee Scheme, to give it a welfare edge, following criticism that it was disconnected from people's concern over corruption, high food prices and inflation.

The attempt will be to make it more responsive to people's needs and increase earnings of the rural poor. The reform attempts to make the scheme truly demand-based, besides addressing issues of fraud, misuse of funds, corruption and structural problems like delayed payments.

Rural Development Minister Jairam Ramesh said, "while implementation has been very uneven across states and districts, four positive impacts are visible - agricultural wages have increased, distress migration has shown a decline, area cultivated in some states has increased and water conservation structures have been built and in many cases, have been revived. But at the same time, there is clear evidence that the original objectives of MGNREGA have yet to be achieved on a large scale and its true potential as an instrument of rural transformation is yet to be fully realized."

The effort is clearly to recast itself into a welfare state by reaching out "to the 2000 poorest blocks, especially those with a high Scheduled Caste and Tribe population". By focusing the reforms on the poorest areas, the government is seeking to stress that in recasting its welfare component it will not endanger industry's growth path.

In seeking to implement the Rural Employment Guarantee Act in letter and spirit, the Centre is putting a greater pressure on states to deliver.

In its document on 'Reforms in MGNREGA Implementation,' the Rural Development Ministry has sought to put the legal entitlements of the rural labour at the heart of the programme in keeping with the rural employment guarantee law. It has been suggested that all states index its schedule of rates, or wage rates, to inflation at the beginning of every financial year. This would mean that cost estimates of projects would have to be revised.

This would avoid the current practice where wages are revised downwards when the project cannot be completed within the existing cost rate. A crucial flaw in implementation has been the inability to make MGNREGA a truly demand-based programme. Though rural labour is legally entitled to be paid if work is not provided within 15 days of application, this happens very rarely. This undermines the demand-based nature of the programme.

The centre is making it mandatory for all states institute systems to pro-actively seek and record demand for work. This would include efforts at the gram panchayat level to proactively increase recording of demand for work. The Centre has said that workers should be provided receipts for application.

Put together, it should become easier to ensure that workers are paid unemployment notice in case work is not provided. The ministry has suggested bringing forward of the labour budget from the current schedule of October to August. In practice, the labour budget is supply driven, that is the capacity to provide work rather than based on demand for work by rural labour.

This would ensure that rural labour is aware of the work opportunities in the area ahead of the Kharif harvest, allowing them to take an informed decision on migrating from villages for work.


The Economic Times, 2 September, 2011, http://economictimes.indiatimes.com/news/economy/policy/mgnrega-recast-to-focus-on-welfare/articleshow/9829648.cms


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