Fix MGNREGA, Save Rural Poor

To provide relief to the migrant and rural poor as well as the economy the government needs to fix MGNREGA urgently. From de-digitization to decentralisation, Reetika Khera lists out what needs to be done. 





After an unprecedented ordeal of months, lakhs of migrant workers are making their way back to rural India. The majority of them will be out of pocket by the time they make it back home and in urgent need of livelihood to make ends meet.  India’s flagship employment guarantee scheme has been flailing for some years now but perhaps never before has it been more relevant. MGNREGA has the potential to provide relief to urban and rural poor who have been hit economically by the extended lockdown. But in order to do that some of its design features and implementation need to be reformed urgently. Reports say there has been a 20 fold increase in the demands for jobs under the scheme amidst the exodus. The demand is in all probability likely to increase through the monsoon months. Furthermore, it might not be indicative of the actual demand given that workers tend to face barriers to registration due to a cumbersome process.  However, only 57% of those who have sought jobs have been given work. Add to this scarcity and the chronic issue of delayed payments - thousands of crores worth of wages are still due to workers for the past several months.  Identifying the problems with this lifeline of a scheme and finding solutions is the need of the hour. Reetika Khera tells us what needs to change and why. 1) Registering for jobs under the scheme now has to be done through e-muster rolls (EMRs) - has this led to exclusion and the rise of middlemen? I think any application / registration of work requirements for NREGA leads to exclusion, and possibly also to middlemen. This is because workers under the scheme may either be unaware of such a requirement, or when they are aware, many find it hard to navigate the system on their own.  Through UPA1, we had two scenarios: in scenario 1, the Gram Panchayat proactively opened work, and anyone who wanted it (and had a job card and bank account) showed up. In scenario 2, with a written application for work being required, workers did it at the worksite, and handed it over to the gram rozgar sewak. It was treated largely as a formality. In UPA-2, scenario 3 emerged: a written application was required to be given to the NREGA functionary, that was then taken to the Block or Gram Panchayat office for online data entry. That in turn, resulted in an EMR being generated, and then workers could work. Why were EMRs introduced? One thought was that it would help catch delays in wage payments because a system-generated EMR would come with a timestamp. But people found work-arounds for this on the ground (e.g., by registering demand for work in the system, after people had worked, so that the electronic records - far from capturing progress in real-time - were trailing physical progress). Another thought was that if names could not be added manually, then the possibility of adding ‘fake’ (non-workers) names would be eliminated. Here again, people have found a workaround: NREGA functionaries use the job cards of non-workers to make fraudulent demand for work. “I think any application/registration of work requirements for NREGA leads to exclusion, and possibly also to middlemen. This is because workers under the scheme may either be unaware of such a requirement, or when they are aware, many find it hard to navigate the system on their own.” Without bringing any particular improvement in the implementation of NREGA, my sense is that E-Muster rolls made matters worse. They resulted in more paperwork, plus in most parts of the country, it led to that (digital) paperwork being physically further away (data entry often happens at the Block office due to infrastructure and connectivity issues) from the worker, making any follow-up harder for workers. Let me reiterate that while EMRs remain compulsory, it will not be possible to accommodate workers who did not apply for work (formally) on NREGA worksites. 2) Would you suggest that at least for this period the registrations be done manually on job sites? Yes, I think allowing workers to join work without imposing the demand requirement will help tremendously. This needs to be accompanied with proactive opening of worksites as well. Several safeguards can be put in place to ensure that corrupt practices are curbed: eg., keeping MRs (Muster Rolls) at the worksite, available for scrutiny by everyone; asking workers to mark their attendance twice a day will ensure that workers themselves are able to monitor addition of ghost names. (Not all workers can become whistle-blowers if they notice any irregularity, but openness puts pressure on the implementing agency.) 3) As per figures, less than 57% of those who have demanded work have received work - what might be the reasons for this? As far as I understand it, and as I’ve explained in the context of EMRs, the ‘employment demanded’ and ‘employment generated’ data on the NREGA MIS (Management Information System) is by and large meaningless, entered by data entry operators and the implementing agency to meet the requirement of the MIS. The NREGA MIS has an element of ‘haathi ke daant, in the sense that it projects a picture that might not necessarily be true on the ground. The meaningful number in the MIS is ‘employment provided’. In April-May 380 million person-days have been generated, and 33 million people have been employed. Remember, there are approximately 270 million registered NREGA workers, so a tiny fraction have got work so far. Average days of work per job card (140 million as a whole) so far is 3 days. The average is highest in Chhattisgarh (12 days). Some states have woken up to the crisis and have cranked up the NREGA machinery. The employment figures for Andhra Pradesh, Rajasthan, Chhattisgarh, Madhya Pradesh are picking up fast. In other states (Jharkhand, Bihar, Gujarat, Maharashtra) things are not moving fast enough.  I think it is a matter of district and Block level implementing agencies sensing from their political bosses whether or not this is a political priority, as well as having administrative capacity (even this is linked to how much of a political priority it is). “Yes, I think allowing workers to join work without imposing the demand requirement will help tremendously. This needs to be accompanied with proactive opening of worksites as well. Several safeguards can be put in place to ensure that corrupt practices are curbed.” 4) Is there a need to increase work sites? What needs to be done for this? Can the list of permissible work be expanded? Could you give some examples? Definitely. As I mentioned earlier, Gram Panchayats should not wait for workers’ demand to be registered to open worksites, because in many places workers may not be able to do it. The list of permissible works has always been a contentious issue. I think it is first important to point out that even “mud works”, as they are often described, under NREGA are important. This has been pointed out, poignantly, in a poem by Akhil Katyal, but also by researchers. Desilting work in flood plains, land-levelling, mangrove plantation to prevent flooding in the Sunderbans, etc. are ‘mud works’ but valued by local communities. It might be possible, even within the list of permissible works, to undertake a lot of useful work.  Also, rather than ‘experts’ like me making specific suggestions, the Ministry of Rural Development (MoRD) should enforce what was in the NREGA from the beginning – allowing Gram panchayats to decide what works can be undertaken, keeping the 60:40 labour material ratio in mind. [I say this with some hesitation, because it’s always possible that such decentralization will be abused, but this is part of the Act.] Instead of decentralizing, we’re increasing central diktat, even as far as permissible works are concerned. Note also, that the list of permissible works has been expanded already over the years, sometimes including activities that I’m not convinced about (eg. construction of anganwadi bhawans and homes under PMAY). Finally, other people have been suggesting that some agricultural activities should also be included. Again, I’m not sure myself, and perhaps wider consultations at the state level is the way forward. “Gram Panchayats should not wait for workers’ demand to be registered to open worksites, because in many places workers may not be able to do it.” 5) Is there a risk of infections going up? What measures need to be taken to prevent this? Yes, initially, because I was quite worried about that, I’d thought it would be good if the government could just pay 10 days of wages without asking people to work (this would work out to about Rs. 2000 per family) for 2-3 months, depending on how the epidemic played out. It will cost about Rs. 28,000 crores per month, to give 10 days wages to all 14 crore job card holding families. That would provide relief to NREGA households, whom we know to be poor. Also, some people ask, what about migrant workers in urban areas, but many of them have roots in rural areas, and so such a transfer might reach them too.  But what is also possibly true is that infection in rural areas is not high, and that with some precautions (such as masks, frequent washing of hands), it might be possible to avoid infection. Hand-washing is in any case an important personal hygiene lesson, sorely required in India. (According to NFHS-4 data, in rural India, just under half of sample households were washing hands with soap and water.) “But what is also possibly true is that infection in rural areas is not high, and that with some precautions (such as masks, frequent washing of hands), it might be possible to avoid infection. Hand-washing is in any case an important personal hygiene lesson, sorely required in India.” 7) Given that there is a high risk of failure as well as infection when workers access payments from rural banks or Banking Correspondents - is it advisable to revert to in-hand cash payments for now? Is the risk of leakage worth taking? As I mentioned earlier, it is a myth that Direct Benefit Transfers (DBT) or bank payments plug leakages entirely. You just have to study the modus operandi of contractors in Jharkhand to know that corruption can thrive with DBT also.  Moreover, as you say, these payment systems are not reliable or convenient from the point of view of the poor. Also, as I’ve said elsewhere (and others have too), cash payment need not be synonymous with corruption. In NREGA, some states were able to control corruption even during the cash payment days, and even today, cash payments are used relatively successfully in other states for other schemes (eg., pensions in Odisha) and more recently, for COVID relief in Tamil Nadu, Andhra Pradesh and Odisha. 8) Given the demand and scale of crisis, should the wages and number of days of work be taken up? By how much? NREGA workers have suffered the past few years from work being rationed and from stagnating wages (in real terms). So, both – more work and higher wages - are desirable. The stagnation in wages is a longer term issue, and this would be a good time to remedy it. Some states are already offering extra days of work from their own budgets. But, as we well know, whether they will make good on these promises remains to be seen. States also have very few sources of income, most are not in a good position.  The main bottleneck, it appears to me, is the central government’s animosity towards NREGA and its unwillingness to recognize, let alone make efforts to deal with, the challenge. For instance, I am not aware of any order from the MoRD to simplify procedures in the light of the pandemic. 9) The government has increased the budget allocated to the scheme but is there still a danger of funds running out or not being released?  For the past few years, what has been happening is that the budgetary allocation that is made, more or less runs out by October, so wage arrears pile up for work done between November to March. Sometimes a supplementary allocation might be made at the Centre’s will, but still some arrears are paid from the next year’s budgetary allocation. “For the past few years, what has been happening is that the budgetary allocation (for MGNREGA) that is made, more or less runs out by October, so wage arrears pile up for work done between November to March.”  10) This is a demand driven scheme - was a budget cap envisaged in the original act? No. All governments, including the one that enacted the law, have been in violation of the Act. State wise allocations are based on a more or less notional ‘labour budget’ that’s supposedly aggregated up from the Gram Panchayat.  Just to give you an idea of the resources that are required: at roughly Rs 200 per day, with 14 crore job cards, to guarantee 100 days, you’d need about Rs 2.8 lakh crores. With the enhanced budget, this year’s allocation is just under Rs 1 lakh crores (once you account for last year’s arrears). Now, it is true that not everyone who has a job card would have wanted all 100 days of work each year, but this just gives you a sense of the scale of under-funding of the programme. 11) The government was supposed to clear wage dues owed to workers under the scheme by April 10th. Has this been done? According to this report in The Wire, there has been obfuscation on what has been released or not (i.e., whether it was material arrears that were cleared, or wage arrears or administrative costs). According to the NREGA MIS, Rs 765 crore of wages were due (on 30 May, 2020). The lack of clarity on the wage arrears issue is a very good example of how digital/technology can be used to obfuscate or to enhance transparency. 12) What other changes need to be brought about to strengthen the implementation of the scheme? Over the past few years, starting in UPA2, MoRD relied on technocratic and centralized control of NREGA. For instance, the switch to the National Electronic Fund Management System, NeFMS, has meant that state governments are beholden to the centre for funds, and can do little when payments are delayed. If we can reverse some of the damaging features of that over-centralization, and re-learn to put workers’ interests and convenience at the centre of its design (not the convenience of the District Collectors, or Joint Secretaries or researchers, for that matter), that will certainly help. “According to the NREGA MIS (Management Information System), Rs 765 crore of wages were due (on 30 May, 2020). The lack of clarity on the wage arrears issue is a very good example of how digital/technology can be used to obfuscate or to enhance transparency.” In a note, Siraj Dutta (who monitors NREGA in Jharkhand), points out that electronic muster rolls cannot be generated at the start of a scheme or in subsequent stages of implementation until the status of the scheme has been geotagged.  People implementing the scheme seem to have forgotten what the objective was. It’s almost as if it has become a testing ground for everyone’s tech fantasy, even if workers end up paying the price. Reetika Khera is an economist and social scientist. She teaches economics at IIT Delhi. You can read more about her and her work here and here




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