The UPA government’s surreptitious attempts to dilute NREGA

August 15, 2009

By Debarshi Das, Sanhati. August 15 2009.

If one remembers the chequered history the National Rural Employment Guarantee Act (NREGA) had to withstand, the recent surreptitious attempts of the UPA government to dilute it does not come as a surprise.

The proposal to provide livelihood guarantee to the rural poor was first mooted in the Congress Party 2004 election manifesto. After assuming office the party conveniently forgot what it had said and had to be prodded by the left allies and various social organisations. So it was as late as 2006 that the legislation started to get executed albeit in a limited way – weathering incessant corporate media barrage that it was anything but a huge hole in government coffers.

The World Bank joined the battle too. The 2009 World Development Report suggested that the scheme was marring the magic of invisible hand of market. Gains of the scheme were however handsomely reaped in states where the implementation was sound. That it was extended to all over the country immediately before 2009 elections is no coincidence.

But history has its nagging habits. Now that the elections are over, many of the radical components of NREGA are being subverted. Private lands could become sites for NREGA work, Gram Sabhas might be bypassed, wage has been freezed (implying purchasing power of labour would be corroded as prices rise). More worryingly, all these changes are being made without consulting the social organisations which had had major role to play in its success.

The following media reports highlight the above developments.

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NREGA wage freeze, work on private land: Social organisations protest

The Hindu. August 11, 2009

Fourteen organisations have opposed the manner in which the United Progressive Alliance government has been rushing through the restructuring of the National Rural Employment Guarantee Act (NREGA), which they say is against the spirit of the law and to the detriment of Dalits and the poor.

Outlining the opposition registered by 14 organisations at a meeting recently, the People’s Action for Employment Guarantee on Monday accused the government of subverting democratic institutions by allowing NREGA works on private land of small and marginal farmers without any consultation.

Aruna Roy of the Mazdoor Kisan Shakti Sangathan, Jean Dreze, a visiting professor of Allahabad University, Dunu Roy of the Sanjha Manch, Arundhati Dhuru of the National Alliance for People’s Movement, Annie Raja of the National Federation of Indian Women, Nikhil Dey and Kiran Shaheen said the Ministry of Rural Development did not care to go through the consultative process before taking a major decision in respect of the NREGA.

Underscoring the major change in the government’s approach post-elections, the activists demanded that it withdraw the decision forthwith, as the NREGA was in the main meant to benefit the Scheduled Castes and Scheduled Tribes, Dalits, below poverty line households and land-allottees. They alleged that it would lead to subsidising semi-agricultural activity of the more powerful vested group. Furthermore, monitoring the work on private fields was not easy for government agencies.

The activists said they were at a loss to understand the government’s decision to freeze wages. It was the prerogative of the State governments to decide the issue, and none could be denied the minimum wage, they reasoned. They demanded the withdrawal of the order and hoped the Congress would keep in mind its poll promise of increasing the NREGA wage to Rs.100, linking it to the price index, and providing each adult with a job. They also condemned the decision to allow the use of machines for works in violation of the law that makes labour component mandatory in expenses.

The proposal for convergence of schemes with other departments was another attempt at usurping the powers of gram sabhas. Without the necessary safeguards, they said, this would only allow contractors and machines to dominate the scheme, to the disadvantage of the poor.

The Ministry will outline the new features of the NREGA at a function scheduled for August 20. It will be attended by UPA chairperson Sonia Gandhi and Congress general secretary Rahul Gandhi.

These leaders hoped the government would not announce any decision at the meeting, and instead put forward proposals to facilitate debate. They sought a law for guaranteeing employment in urban areas, providing for living wages and social security.

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World Bank roots for urbanisation, migration

March 13, 2009. The Hindu

Turning on its head tenets favouring dispersal of economic activities geographically to benefit the poor, the World Bank has in its latest report called for shifting populations from villages to cities. “Growing cities, ever more mobile people and increasingly specialised products are integral to development.”

That is the prescription of the ‘World Development Report 2009: Reshaping Economic Geography’ that was released on Thursday.

Director of the the World Development Report (WDR) and Chief Economist, Europe and Central Asia Indermit S. Gill sought to justify the change in its policy recommendation in a historical perspective that production concentrated in big cities, leading provinces and wealthy nations. Half the world’s production fitted into 1.5 per cent of its land.

The report “welcomed and encouraged” the process of migration saying that “globally as well nationally people move in order to improve their prospects in life. It pointed out that about 30 million people had moved from the lagging States of Bihar and Uttar Pradesh to leading States such as Maharashtra and Punjab in the second half of 1990.

Mr. Singh regarded as short-term constraints the recent opposition in Maharashtra to such migration.

In the context of the financial crisis gripping the world, the WDR feared that protectionist tendencies in both developing and developed countries could seriously jeopardise both the recovery and longer term progress.

The report contended that markets favoured some places over others and countering the tendency would amount to fighting prosperity. It expected governments to facilitate such geographic concentration and initiate policies to provide for basic needs such as schools, security, streets and sanitation.

“Instead of worrying about the size of metropolises, cities and towns,” the WDR called upon policy makers “to worry about making sure these places work well.” It highlighted the case of Mumbai, which continued to attract people, and had twice the number of residents today than in 1980 when its population was 7.5 million.

World Bank Senior Economist Somik V.Lall argued that spreading out economic activity could hinder growth and did little to fight poverty underlining the WDR’s approach challenging the assumption that economic activities must be spread geographically to benefit the world’s most poor and vulnerable.

Referring to India, the WDR called for infrastructure development and reduction in transport costs because distance was a challenge and the problem was compounded by concentration of poor people in the rural areas.

The report called for blending of policies so that developing nations could reshape their economic geography the way high income economies died in the past. “If they do this well, their growth will still be unbalanced but their development will be inclusive.”

Mr. Gill was against establishment of heavy industries in rural areas on account of their density and to preserve agricultural activity.

The report examined the Special Economic Zones (SEZ) in India and China, underlining the differing approaches in the two countries. China’s approach reflected a strategy of exploiting the best locations to access external markets, while in India these had been developed by the private sector and targeted the large domestic market. But it felt that these were not as well located.

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Further articles on Sanhati.