National Rural Employment Guarantee Scheme of India: Some Conceptual Problems

Abstract

The need for containment of “surplus population,” deployment of untapped resources and ensuring “right to work” have induced the developing world to take up programmes like the National Rural Employment Guarantee Scheme in India. However, contrary to the proposed target of short- and long-run employment generation outside the circuit of big capital, the National Rural Employment Guarantee Scheme, in fact, could act as an instrument for capital accumulation itself by helping in direct transfer of resources or in diversification towards “market-oriented” resource use. Labour would be used in the initial rounds, but later on a process of accumulation and displacement could be engendered. Researchers also criticize the National Rural Employment Guarantee Scheme from the perspective of government budget management. However, we argue that government budget constraint and consequently, demand-side conflict between the National Rural Employment Guarantee Scheme and the non-National Rural Employment Guarantee Scheme employment is not so important; there is rather a significant supply-side trade-off. Furthermore, political mobilization of people is the key for effective pro-poor utilization of the National Rural Employment Guarantee Scheme in the short and long run, consistent with local traits, needs and resources. But bureaucracy and the so called state institutions of decentralization are practising a variety of patron–client relationships vis-à-vis the commoners and there is no serious attempt by the established political parties—be it left or right—to mobilize people's voice.

Keywords:

• inclusive growth
• accumulation and dispossession
• elite capture
• resource constraint
• NREGS
• non-NREGS trade-off
• people's rights and people's voice

Acknowledgements

This analytical note has developed through the first author's earlier publication endeavour (Chakrabarti 2011) and through his participation in the workshop on “National Rural Employment Guarantee Scheme (NREGS): Current Situation and Emerging Priorities for Research,” on August 5–6, 2010, at the Centre for Studies in Social Sciences, Calcutta, India and in the course of his active involvement in the subsequent field visits to South 24 Parganas and Birbhum districts of West Bengal (province) and to Puri and Nayagarh districts of Orissa (province), India. The author got earlier exposure to the problems with NREGS while participating in field work for Subhasish Dey. The research is showed in “Evaluating India's National Rural Employment Guarantee Scheme: The Case of Birbhum District, West Bengal,” ISS Working Paper 490, International Institute of Social Studies (The Hague).

This paper is developed from The Planning Unit (Government of India) Working Paper (March 2012), Visva-Bharati (University), Santiniketan, India, and from an ongoing project on livelihood guarantee programmes across the Global South, funded by the Brown International Advanced Research Institute (BIARI), Brown University, USA.

The authors are grateful to Kalyan Sanyal, Subhasish Dey, Anirban Dasgupta and Arjun Singh Bedi. The authors also thank Amitava Bhattacharya, Snehashish Bhattacharya, Lopamudra Banerjee, Rajesh Bhattacharya and Pranab Kumar Chattopadhyay. Detailed comments from the three referees and also from the editors, especially Chen Shuoying, have been very helpful. The usual disclaimer applies.

Notes

¹“[A] UN agency highlighted the problem of ‘jobless growth,’ with an unemployment crisis looming worldwide. … Growth of the past many years has not been translated into enough jobs in many countries. … The unemployment rate in 2005 remained unchanged at 6.3% even after a decade of growth” (Khor 2006). The situation has worsened after the recent global meltdown. The dimension and magnitude of un(der)employment could be understood to some extent by looking at Indian data (see table A4).

²Some of such programmes in other countries are: Expanded Public Works Programme (EPWP) of South Africa; Jefes y Jefas de Hogar (JH) and Asignación Universal por Hijo (AUH) of Argentina; and Bolsa Familia (BF) in Brazil.

³Such employment features unskilled manual—mostly earthen—work with the stipulation of 60:40 ratio between the labour and material cost.

⁴Inclusive growth is defined as “the process and the outcome where all groups of people have participated in the organization of growth and have benefited equitably from it” (UNDP 2008).

⁵We saw in our field visits that people want work to avoid the hazards, costs and uncertainties of migration. Women are also interested in working to support their families. Potential and actual beneficiaries reported they want work to smooth out their fluctuating consumption across agricultural seasons. Moreover they reported a kind of sharing of the stipulated work among themselves. People were also proud of their work and they were aware of the necessities of minimum infrastructure. However, there are serious problems of information asymmetry; rights consciousness is almost missing among the beneficiaries and it seems that the elected representatives and officials violate the very notion of “right to work” by developing a kind of patron–client relationship with the commoners. By this arrangement the grievances of the people regarding NREGS are internalized/appropriated at least to some extent. The irregular and ill-timed flow of funds seems to make the situation worse.

⁶Only certain kinds of work can be organized locally for the purpose of providing employment under NREGS. These include: local water conservation and harvesting, drought proofing, afforestation, minor irrigation, flood control and protection, renovation of traditional water bodies including de-silting of tanks, land development and construction/renovation of village roads within a specific locality and involving local people. Furthermore, transparency is to be ensured by undertaking social audit by the villagers themselves and by making all accounts and records available for public scrutiny on demand (Ghose 2012, 20).

⁷See also www.nrega.nic.in for details of data. A very important “self-evaluation” from the Central Ministry can be found in http://nrega.nic.in/circular/Reforms_in_MGNREGA01092011.pdf. We will discuss NREGS performances in some detail later in this paper after our own analytical interventions vis-à-vis the vast multidimensional literature. We are deferring our data analysis to present the perspective of theoretical critique.

⁸Detailed debates on NREGS could be found in http://www.righttofoodindia.org/rtowork/rtw_articles.htm.

⁹However, there are clear indications in the literature that NREGS is unlikely to develop durable quality infrastructure (Shah and Jose 2009, 13; Ghose 2012, 16).

¹⁰Please see below clear indications on this point.Experiences from Maharashtra Employment Guarantee Scheme (MEGS), a precursor to NREGS, have shown mixed outcomes with respect to a wide range of developmental as well as welfare objectives that were expected to be addressed by the scheme. … More importantly, it demonstrated that economically powerful ruling class turned the scheme to their advantage by not only extracting economic benefits from asset creation that took place under the scheme, but also by co-opting the oppressed in order to reinforce its political dominance. (Shah and Jose 2009, 3; emphasis added)Also see:Indeed, we should recognize that there is inherent tension between the objective of delivering income gains to the poor and that of creating/renovating productive assets for promoting agricultural growth. Given that land is privately owned, it is not easy to create many publicly owned assets that can enhance land productivity. If agricultural growth is to be stimulated, public works have to create assets that become privately owned and even the publicly owned assets cannot but benefit private landowners. And these benefits can only vary directly with the size of landholding. All this seems highly inequitable. (Ghose 2012, 17; emphasis added)

¹¹It has been expressed by Banerjee and Duflo (2011) that “lending money to the poor may not imply they spend it on food … they are accustomed to being hungry leads them to use the money on luxuries like shampoos!” (quoted in Mukherjee 2011, 6) and “that ‘hungry’ families spend large amounts of money on festivals and family events” (quoted in Rosenzweig 2012, 4).

¹²“What seems puzzling in all this is that the government has not used the large stock of foodgrains it holds to check food price inflation. That a scheme such as MGNREGS would put pressure on food prices was not difficult to anticipate. … Yet the government was actually building up stock in 2009–10 rather than using the accumulated stock to put downward pressure on food prices” (Ghose 2012, 15–16) .

¹³“Indeed, we should recognize that there is inherent tension between the objective of delivering income gains to the poor and that of creating/renovating productive assets for promoting agricultural growth” (Ghose 2012, 17). This was also found in the commentaries of several researchers in the workshop on “National Rural Employment Guarantee Scheme” on August 5–6, 2010, at the Centre for Studies in Social Sciences, Calcutta, India.

¹⁴According to many researchers the main problems facing the Employment Guarantee Programmes in India have been:[O]rganizational inflexibility, rigid nature of bureaucracy, excessive burden of utilization of federal allotment of funds. … Identity based social exclusion and inclusion sometimes play crucial roles. (Dey 2010, 26; emphasis added)Thus, local conditions requiring flexibility in designing and implementing the programmes and in utilizing the funds are overlooked. Furthermore, local socio-political specificities are not appropriately taken care of while choosing/building the institutions/mechanisms of design and delivery. It is also noted in the specific context of NREGS that:[E]xpenditure and person days generated increase quite sharply at the end of each financial year implying there could be a pressure from the upper tier of government to spend money within that year so that spill over of money remain less … (neglecting the local needs). On the contrary when there is real need for creation of jobs specially in the lean (agricultural) period, i.e., mid of August to mid of November, there is hardly any increase in spending or job creation … and thereby negating the possibility of promoting this programnme as a safety net in the lean period. (Dey 2010, 47–49; emphasis added)Thus, local agro-climatic and geographical conditions and local necessities are completely neglected while designing the macro-projects at the national level.

¹⁵“One view, rarely heard, is that whilst the provision of some local employment is potentially important, the easy availability of work under NREGA may discourage rural workers from seeking work in rapidly growing areas of the economy. This may, in turn, reduce the potential pace of economic transformation, and lower the prospects of workers gaining new skills. In this way, NREGA, as a means of social protection, may ultimately work against economic growth” (Sjoblom and Farrington 2008, 4).

¹⁶It is found that, even if there is information flow to the potential beneficiaries regarding availability of the scheme/s and that too in many cases from the government institutions, and even if there is proper distribution of job cards (a kind of identity required to get NREGS job), the actual employment generation is very low (Dey and Bedi 2010). This is not at all due to lack of intrinsic demand for job, but due to severe lack of people's voice! The commoners have very little understanding about the notion of basic rights (this is also the field-level observation of the authors across two states of India: Orissa and West Bengal). In this context, we can also quote from a primary survey on West Bengal (Dey and Bedi 2010, 21):While the basic programme awareness is universal, knowledge on the details of the programme such as employment on demand, minimum wages, the right to receive wage payments within a fortnight, the right to an unemployment allowance, and the right to information on all NREGA related documents is not as widespread.This happens in spite of the somewhat justifiable claim that in West Bengal the extent of decentralization is much higher compared to the national average. It perhaps shows a lack of people's mobilization and collective voice.

¹⁷“The delivery systems can be improved with the new approach of participatory development, social mobilization, right to information, involvement of civil society and panchayati raj (system of decentralization in India) institutions” (Dev 2006, 1514; emphasis added). “Unfortunately, these participatory processes are yet to take root within the local communities owing to a number of factors—procedural, financial, and socio-political” (Shah and Jose 2009, 5).

¹⁸“[O]ne of the major determinants or influential factor for accessing such kind of employment programme is the political inclination and the patron–clientelistic relation between the scheme participant and the local politicians. … [There is] the possibility that the poor without political support are excluded from the project. …

 Similarly … [a] study on different emergency employment programmes in Argentina between 1993 to 2002 claimed that politicians are able to access funds from the federal government, which are then used to buy political loyalties from voters and legislators. [It is] claimed that there is wide agreement among scholars studying Argentine politics that poor and low-skilled voters are more susceptible to being turned into political clients than higher income/skilled voters. …

 In a study on Maharashtra (India) … [researchers] investigated the variety of ways in which the political mobilization of the oppressed could have taken place and simultaneously examined the manipulations by the ruling Maratha—the landed caste to disempower and eventually co-opt such struggles in order to perpetuate its own political dominance in Maratha politics. …

 In West Bengal, where for the last 32 years a left ruling government is in operation, a very recent study shows that there is a strong existence of clientelistic relations between beneficiaries and the left ruled village panchayats when government's benefits are of a recurring nature. The NREGS is a recurring type of programme and it is possible that access to this program will also be influenced by the existing clientelistic patterns in the state” (Dey 2010, 26–27).

¹⁹In the Indian state of Jharkhand, as Bhatia and Dreze (2006) report, unfortunately, the government officials restricted job card access to below poverty line (BPL) households and attempted to restrict the number of job cards issued in order to keep their workload under control. However, in the district of Birbhum, West Bengal, the picture is much better (Dey and Bedi 2010, 21). Our field observations are also revealing: it is very interesting to note that the Block (second-tier of district administration) Development Officers (BDOs) of Satyabadi Block and Daspalla Block of Orissa expressed pessimism about peoples' interest in NREGS, which was exactly the same for Sonarpur Block in West Bengal. While the BDO of Satyabadi Block talked about proximity to Bhubaneshwar and Puri as the cause of people's disinterest (just as Sonarpur BDO talked about proximity to Kolkata), the Daspalla BDO complained about the lackadaisical attitude of the lower-caste population. The latter BDO complained vigorously about the “litigating” and politicized attitude of the people and argued that people have alternative opportunities and hence they in general do not want to work. However, we hasten to add that we, on the contrary, clearly saw abject poverty and a very serious urge to work under NREGS in all these places! The only problem is that the collective voice is absent.

²⁰Our visits to the field showed serious problems with banks and post offices as fund distributing agencies. Another serious issue is the lack of coordination between Panchayats (the third/lowest-tier of district administration) and the higher tiers in terms of flow of funds, etc. We could notice several irregularities in the processes of formulation and especially implementation of NREGS by these Panchayats. The anomalies in job-card distribution, application process by the beneficiaries demanding job and providing compensation in absence of job, lags in payments and lack of worksite facilities are some of the serious faults. The nature/type of earthen work under NREGS was reported to be inconsistent with the local requirements given the agro-climatic and geographical specificities. The problem becomes more complex due to the lack of coordination between the flow of funds and the appropriate seasons of work. Though there are certain attempts to social forestry and forestry in private lands and social and private water body up-gradations and excavations, in general, there seems to be either lack of vision for the elected representatives of the villagers to generate large scale employment or a bias towards building durable assets or both. Peoples' monitoring is not visible as such.

²¹“… [T]he poor needs to be empowered to demand their rights. … The ‘right to work’ embedded in NREGA makes it unique, and if efforts are made to help the poor in recognising and articulating this right, these may ultimately prove to be equally, or perhaps even more important, than the principle of self-targeting. … The rights-based dimension of NREGA can be important in the short term, especially where rights are expanded to include, for example, crèche facilities, and the poor are supported in becoming aware of and realising their rights. For the longer term, improved ability to voice and claim rights can spread also to other economic and social spheres, with substantial benefit for the poor . . . [however,] there is as yet little evidence that the public work in which poor labourers are engaged will generate benefits for them (and thus not be captured primarily by the better-off)” (Sjoblom and Farrington 2008, 3–4; emphasis added).