MGNREGS as insurance(hinduEditorial,NREGA )

With unseasonal rain laying waste vast areas under the rabi crop in north India earlier this year and the threat of a deficient monsoon looming, the Mahatma Gandhi National Rural Employment Guarantee Scheme could act as a real salve for distressed farm workers and labourers. The World Bank’s brief statement on the scheme on Tuesday to this effect, as part of its latest India Development Update, concurs with recent empirical research that has revealed that the MGNREGS has acted as an effective substitute in the absence of crop and weather insurance to poor farm households in some States lately. The National Democratic Alliance government would do well to heed this timely suggestion from the World Bank, which has released a volume on the scheme based on research done in 2009 and 2010. The Bank goes on to say that the MGNREGS can be a better-targeted scheme than even a cash transfer programme. Yet, reports reveal that there is much unmet demand for labour provided under the MGNREGS over the past year, due to poor implementation by some State governments and a general apathy shown by the NDA regime since last year. This is evident in the reduced outlays for the scheme (as acknowledged by the Finance Minister, yet addressed only with a promise of additional budgetary support subject to the availability of revenues), and delays in transfer of monies to State governments which has led to tardy wage payments. All this has resulted in an unresponsive set of conditions that has not encouraged demand for labour provided under the scheme. The government’s effort to identify the poorer districts for higher allocations has only seemed to curtail demand in the other districts, which number much higher. The MGNREGS is a demand-driven scheme, but the fact that it requires adequate conditions for its effective implementation is self-evident.

The laxity in the implementation of the scheme over the past year has meant a reduction in the number of workdays as compared to previous years. There are certainly a number of improvements that are required to be made. These include better and more productive asset-creation through work done, improved administrative management, provision of information to and sensitisation of the public as the World Bank also points out, and checking leakages. But the fact that the MGNREGS has provided succour to India’s poorest sections in rural areas is something that has been acknowledged and acclaimed, as the World Bank statement also shows. Considering that the benefits of the scheme outweigh the drawbacks, it would be an act of poverty if the government does not utilise the MGNREGS to bring relief during a time of significant agrarian distress in a number of States.

Keywords: World Bank, NREGA