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Stagnant wages, payment delays & eroding support: Jean Dreze on MGNREGA @10

Nihar Gokhale | Updated on: 14 February 2017, 5:33 IST

Social scientist Professor Jean Dreze isn't just one of the principal architects of the Mahatma Gandhi National Rural Employment Guarantee Act, the job scheme he campaigned extensively for and prepared an early draft of. He's also credited for studiously following up on the scheme's implementation, writing countless academic papers and popular articles, besides serving on the erstwhile National Advisory Council and the Central Employment Guarantee Council.

Read- [email protected]: In Banda, a job card can be the difference between life and death

Speaking to Catch a decade after the jobs scheme was implemented, Prof Dreze feels that it continues to be a "struggle", with uphill challenges ahead. Dreze fees that stagnant wages and delays in payments have "sapped workers' interest" to avail the scheme, and dwindling political commitment is sending a "very destructive message" for its future.

When the MGNREGA was implemented 10 years ago, where did you imagine this scheme would reach today? How close, or far, is it from those expectations?

I was hoping for more, but without any illusions about the challenges involved. MGNREGA defies many vested interests and it is bound to remain a struggle. But it is a struggle worth sustaining. I can hardly think of a more moving experience than that of talking with MGNREGA workers, especially women, who have been able to use the programme as an opportunity to organise and defend their rights.

MGNREGA implementation data shows that on average, under 50 days have been generated per household. Less than 10% households have completed 100 days of employment in a year. Why do you think this is so?

Sometimes the low scale of employment is due to a lack of funds, but there are other reasons also. Stagnant real wages and persistent delays in wage payments have sapped workers' interest in MGNREGA work. The guidelines have become very complicated. In many areas, the infrastructure required to implement MGNREGA's internet-based processes is sorely lacking. Last but not least, political commitment TO MGNREGA has declined. This sends a very destructive message down the line.

Stagnant real wages and persistent delays in payments have sapped workers' interest in MGNREGA work

There has also been a reluctance on the part of governments to adequately fund the MGNREGA. If we assume that this trend in funding remains the same, what's the best-case scenario for the scheme?

The central government needs to return to the fundamental principle of open-ended funding for MGNREGA. Workers have a right to work on demand, and if they work, they have to be paid. Open-ended funding is the acid test of the central government's commitment to MGNREGA. Without it, work on demand is impossible.

In the major drought-hit states, MGNREGA has performed poorly. Implementation data shows that most of the workers have not been paid within 15 days, and many will be unable to complete even 100 days of work within this financial year, let alone the 150 days promised to drought-hit areas by the central government. What is your assessment of this?

There have been long delays in MGNREGA wage payments ever since cash payments were replaced with bank and post office payments about six years ago. The Ministry of Rural Development claims a significant reduction in delays this year, compared with last year, and that may well be true. However, delays continue and their effect is very destructive because they discourage workers from seeking MGNREGA work. Many of them cannot afford to wait for weeks on end for their wages, and that applies especially in drought-affected areas.

Aside from this, MGNREGA is afflicted by a long-standing failure to realise the principle of work on demand. Most workers do not know where and how to apply for work, and government functionaries would rather avoid the obligations attached to this principle. As a result, MGNREGA work continues to be more supply-based than demand-driven.

Also read: Govt has failed drought victims by starving MGNREGA of funds

What should be the way forward?

In a drought situation, it is extremely important for relief work to be genuinely available on demand, and for wages to be paid promptly. Under MGNREGA, this would require special provisions, such as pro-active work application camps or mandatory activation of at least one MGNREGA work in every village at all times.

Alternatively, relief works could be initiated outside the framework of MGNREGA. Simply waiting for MGNREGA to ensure drought relief within the current guidelines will not serve the purpose.

Do you think emphasising the scheme as an agent of social change has clouded its other role - as an agent of economic change?

This sounds like an artificial dichotomy. MGNREGA is a multi-purpose programme that integrates different forms of economic and social change, from the creation of productive assets to the empowerment of women and the revival of local democratic institutions. Perhaps there are, at times, tensions between economic and other objectives of MGNREGA.

But there are important complementarities as well. For instance, if MGNREGA helps to raise women's labour force participation, that would be a positive economic as well as social change. So I don't see a significant general dilemma between economic and other objectives of MGNREGA.

The threat of climate change enhances the value of MGNREGA as a low-cost, labour-intensive programme

In the face of climate change, what role does a scheme like MGNREGA have in building a "green" economy?

Protecting and improving the environment has always been an important objective of MGNREGA. There have been many useful projects in this field, such as water harvesting, soil conservation, roadside plantation, flood control and so on. The threat of climate change further enhances the value of MGNREGA as a low-cost, labour-intensive environmental programme. It would be really interesting to compare what it costs, say, to grow a tree under MGNREGA with the corresponding costs under international programmes of climate change mitigation.

Edited by Aleesha Matharu

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First published: 3 February 2016, 9:31 IST
Nihar Gokhale @nihargokhale

Nihar is a reporter with Catch, writing about the environment, water, and other public policy matters. He wrote about stock markets for a business daily before pursuing an interdisciplinary Master's degree in environmental and ecological economics. He likes listening to classical, folk and jazz music and dreams of learning to play the saxophone.