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Employment Guarantee: Progress So Far

The National Rural Employment Guarantee Act is into its second year of implementation. It is easy to criticise the Act and its execution. However, even as we recognise its shortcomings and the scope for correction, we must consider what it has achieved so far and the promise it continues to offer.

Employment Guarantee: Progress So Far an unemployment allowance. It is true that this will not end either poverty or exploitation, but it is significant nevertheless, and could mark the beginning of
momentous changes in the lives of the
rural poor.
Lalit Mathur The NREGA is certainly far too impor-

The National Rural Employment Guarantee Act is into its second year of implementation. It is easy to criticise the Act and its execution. However, even as we recognise its shortcomings and the scope for correction, we must consider what it has achieved so far and the promise it continues to offer.

Lalit Mathur ( retired as the director of the National Institute of Rural Development, Hyderabad.

Economic & Political Weekly december 29, 2007

he National Rural Employment Guarantee Act (NREGA) is now in its second year. Much has been written about it, by those who oppose the employment guarantee and by those who advocate it. And still a general impression prevails, without much debate, that the programme is not worthwhile. There is inadequate awareness perhaps, that the NREGA is more than a scheme for wage employment and that it has other underlying objectives.

There are few parallels to such a programme in the world. Argentina had introduced a job creation scheme, the Plan Jefes y de Hogar, in 2002, after the virtual collapse of its economy. This was a more limited intervention than the NREGA, focusing on municipal areas, though it covered a wider range of activities including community services, health, education, child care and self-employment; it was “redesigned” in 2006 to a programme primarily of unemployment insurance and welfare.

The NREGA is the first tangible commitment to the poor that they can expect to earn a living wage, without loss of dignity, and demand this as a right. The government has a statutory obligation to provide employment to every household, or, if unable to do so, to provide tant not to be properly appreciated or to fall victim to a superficial understanding. A distinctive feature is that only the very poor, and none else will seek benefits from it – and so it cannot, almost by definition, generate the support of any lobby – for there are few interested in it, and fewer still who will be prepared to work for its success. A balanced and informed view also tends to become uncommon.

Scope and Performance

Although it has now been announced that the NREGA will be extended to the entire country from 2008-09, the act itself was enacted after considerable opposition from within the government itself.1 The employment guarantee already covers more than half the country – over three lakh villages and 1.5 lakh gram panchayats in the most arid and drought-prone regions; tribal and forest areas where many villages are still not accessible – in its vastness, reach and scope, it is truly huge. It is certainly not easy of implementation.

While it is too early to make a comprehensive assessment of the programme, the performance data for 2006-07 should nevertheless be seen. At the macro level, the figures are impressive: out of 2.16 crore households who sought employment,

2.10 crore households (97 per cent) were provided work of 90 crore person days, an average of 45 days in the year.2 The participation of women (41 per cent), scheduled castes (SCs) (25 per cent) and scheduled tribes (STs) (36 per cent) was high; equally significantly, unskilled wages comprised 67 per cent of the total expenditure, and 94 per cent of the expenditure on wages. About 8.41 lakh works were taken up of which 3.97 lakhs were completed, and out of the Rs 12,073 crore available for the programme, Rs 8,823 crores (73 per cent) was utilised. This trend has continued during 2007-08.


Performance Data

The data in Table 1 show that funds for the programme have not been a constraint. However, some states availed of larger amounts relative to the number of NREGA districts. The utilisation per district was more than Rs 100 crore in Rajasthan (115) and Madhya Pradesh (103) and high also in Chhattisgarh (61) and Assam (85); on the other hand this was less than Rs 25 crore in Gujarat (14), Maharashtra (18) and Tamil Nadu (25).

The objective of 100 days of employment was not achieved in any state. However, the per district person days of employment and households provided employment were comparatively high in Madhya Pradesh (1.6 lakh households, 68 days), Orissa (0.7 lakh households, 57 days), Chhattisgarh (1.7 lakh households, 54 days) and Rajasthan (two lakh 50 per cent in several were completed by March. As the programme stabilises, so also should the norms for the selection of works in each district – their nature, size and number.

In such programmes there will inevitably be some leakages and imperfections, with reports from districts of things going wrong, of delays, of corruption, and so on. These must, of course, be set right and continuous efforts made to do so. At the same time, such reports in the initial years should not be allowed to cloud the significance and relevance of the employment guarantee.


The NREGA is an initiative comparable perhaps only to the green revolution and it is also a complex one. It requires action on several fronts and coordination on a scale not envisaged so far.

First, the active participation of the rural poor, unorganised, exploited, on the fringes of hunger, disillusioned by government schemes and unfulfilled promises. Second, the close involvement of reluctant government officials and administration – from the village to the state – who would not have a clear understanding of their responsibilities under the NREGA. Third, the mainstreaming of the panchayats, to deliver in a situation where most have limited capability, little experience and virtually no manpower. Fourth, the owning of the programme by every government agency which executes works in rural areas – essential for the generation of employment and for the creation of meaningful assets. Fifth, partnerships between officials and panchayats, the village community and the administration, the most poor and the decision-makers in the village, NGOs and government. Sixth, a thrust and focus on the programme by the media with its vast influence and reach, now even to remote villages.

These are only the broad parameters of what represents, really, a transformation in the development scenario of India. This transformation cannot happen on its own. A deliberate, planned direction is necessary; to work out a strategy and to put in place a process. This, as yet, seems to have been given little thought.

Table 1: Some Performance Parameters for States and Districts – 2006-07

State No of Funds Expen-Percentage Average Average Per District Daily Average Percentage
NREGA Available diture Utilised Utilisation/ Person HHS Employ- Unskilled No of Completed
Districts (Rs in cr) Dist Days Employ- ment/ Wage Works/
(Rs in cr) (in lakh) ment HH Paid Dist
(in lakh) (Days) (Rs)
Madhya Pradesh 18 2134 1862 87.3 103 110 1.6 68 59 9389 49
Bihar 23 1197 713 59.8 31 26 0.9 35 70 2696 48
Andhra Pradesh 13 1142 680 59.6 52 52 1.7 31 86 17000 39
households, 83 days). In West Bengal and Uttar Pradesh 22 1029 780 75.8 38 37 1.2 32 56 3864 65
Tamil Nadu although three lakh and 1.2 Jharkhand Orissa 20 19 982 890 712 733 72.4 82.4 36 39 26 42 0.7 0.7 37 57 80 53 3200 2684 38 37
lakh households, respectively worked un- Rajasthan 6 856 693 81 115 167 2 83 51 3667 41
der the NREGA, they could do so only for Chhattisgarh 11 841 669 79.5 61 64 1.2 54 63 2909 50
14 and 26 days, respectively. In Gujarat West Bengal Maharashtra 12 10 486 630 174 395 35.9 62.6 18 42 13 44 0.3 3 40 14 104 70 917 430 45 56
and Maharashtra, only 30,000 and 40,000 Karnataka 6 341 248 72.8 41 37 0.8 44 67 3000 61
households per district availed of the Tamil Nadu 6 252 151 60.2 25 31 1.2 26 80 1167 29
employment guarantee. Gujarat Uttarakhand 6 3 124 71 85 48 69.4 68.3 14 16 17 13 0.4 0.4 43 31 56 72 1333 2333 38 57
It would appear that some “backward” Himachal Pradesh 2 57 39 68.9 20 15 0.3 50 69 4500 56
states have done better than several of Jammu and Kashmir 3 50 35 68.9 12 11 0.4 27 69 6300 37
the progressive ones. The number of works per district shows unusually wide Kerala HaryanaPunjab 2 2 1 48 47 38 28 36 25 57.7 77.3 65.1 14 18 25 10 12 11 0.5 0.3 0.3 20 48 37 121 97 96 -8000 1300 -63 62

variations across states – 17,000 and NE States

9,389 in Andhra Pradesh and Madhya Pradesh, res pectively against 430 and 917, respectively in West Bengal and Maharashtra. In most states the figure is between 2,500 and 4,000. Although the financial year does not coincide with the working season, over 60 per cent of the works in some states and around Assam 7 707 83.7 85 82 1.1 Tripura 1 50 90.6 45 50 0.74 Mizoram 2 26 63.2 8 3.9 0.5 Meghalaya 2 26 81.7 11 12.1 0.5 Manipur 1 20 99.4 20 18.6 0.18 Nagaland 1 16 91.3 15 13.1 0.28 Arunachal Pradesh 1 12 18.3 2 4.5 1.7 Sikkim 1 5 57.4 3 2.4 0.04 All India 200 12073 8823 73 8823 90.51cr 2.10 cr The states are ranked in descending order of funds available. Source: Compiled from the data on the NREGA web site of the ministry of rural development. 73 68 16 25 103 47 2.6 61 43 67 60 175 73 75 66 67 87 65 2143 5000 130 1450 1600 128 500 158 8.41 lakh 60 80 80 28 56 97 80 65 43
18 december 29, 2007 Economic & Political Weekly

Important in this scenario is the Right to Information (RTI) Act, which emanated from the movement for transparency and accountability in employment programmes.3 A powerful instrument, it can make a difference to implementation and also to the pace at which the NREGP is effectively absorbed in the development agenda.

This is the initial phase. While the employment guarantee is new, wage employment schemes have existed for many years; therefore, their defects and problems have been inherited by the NREGA. It is important, nonetheless, to recognise this opportunity – not just to improve, but to make a clean break. Already, the employment generated in a NREGA district is three times that of other districts – 45 lakh person-days against 14 lakh.

Beginnings of an Impact

Perhaps, more significant than the figures are the changes now beginning to be seen

– though these are not widespread, and the experience has been both varied and uneven.

The NREGA has impacted the poor: large numbers of unlettered households have made the effort to come forward to register; migration has reduced in several villages in Andhra Pradesh, Chhattisgarh, Orissa and Rajasthan; wages less than the minimum wage were raised in many states; the participation of women increased significantly even in the districts of Rajasthan and eastern UP; unemployment allowances were sought and actually paid in Madhya Pradesh and Orissa; the maintenance of muster rolls has become a feature in several districts.

The performance of the administration also shows positive trends: registration was completed and job cards issued; work was invariably provided on demand; their selection was also relevant – water conservation (54 per cent) irrigation on SC and ST landholdings (10 per cent), land development (11 per cent); initiatives have been taken not just by collectors but by the numerous village functionaries, block development officers (BDOs) and officers at the field level; training programmes have commenced for officials, elected representatives, NGOs and community groups. Significantly, many panchayats responded effectively despite handicaps; in fact, the NREGA enabled them to establish their credibility.

Perhaps, the most remarkable change is that a process for the empowerment of the poor is emerging around the NREGA. The programme has stimulated their mobilisation across the country, possibly for the first time in recent history. This is evident from the large number of ‘yatras’ and ‘abhiyans’, meetings and discussions, awareness and sharing – spread over districts in all states. NGOs and activists have discovered in the NREGA a vehicle for meaningful interventions, which enables the coming together of the village poor for the employment guarantee. Thus, rural workers have negotiated with private employers, even refusing casual work at double the earlier wage. Social audits are now conducted also by government departments and institutions, often in collaboration with NGOs, facilitating the active participation of the poor in development. The RTI Act, effectively utilised in several cases, has had an immediate impact on the confidence of village communities – officials have apologised for their misappropriation in public meetings, and even “returned” the misappropriated money.

Further Interventions

The Employment Guarantee has evidently begun well. There is, of course, great scope for improvement, as indeed, can only be expected in a new programme, especially one of such complexity.

A system of regular and continuous flow of authoritative information is essential – more than just sporadic reports and studies, as at present, dependent on the initiative of individuals and groups. Government could take up concurrent evaluations (as was done for integrated rural development programme (IRDP) and Jawahar Rozgar Yojana (JRY) in the mid-1980s), more effective monitoring, time-series studies, and focused reports on critical aspects like minimum wages, muster rolls. Not just by the centre, but also by the states; not by the departments of rural development alone, but by others as well – labour, agriculture, forests, planning, the CSSO and its network. This is an important period for the NREGA for it is one of learning as well.

Further, this feedback needs to be shared, disseminated and utilised. To improve implementation, troubleshoot, modify policy directives, issue operational guidelines for the district, block and village. This can only happen with greater interaction between all those involved with the NREGA. The available structures like the central and state councils cannot be enough. However, consultation and participation in development do not come easily, or often. Here clearly, government must take the lead, be proactive, mobilise institutions and groups, use the media effectively.

The number of “facilitators” who are involved with the NREGA is staggering –

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Economic & Political Weekly december 29, 2007


several lakh government officials, panchayat functionaries, elected representatives, NGOs and community groups. They play a critical role but have had little preparation for the challenge. The existing efforts for their exposure, orientation and training are at best a modest beginning; these need an exponential expansion. Government has the primary responsibility, and fortunately, also the capacity to do so, with its training in budget, infrastructure and network of support institutions. It must now demonstrate that it also has the understanding and perception.

Most importantly, the isolation in which the NREGA now operates must end – as a mere scheme of one ministry, and no more. This in fact is a programme of national importance which has been marginalised. While the ministry of rural development is the nodal ministry at the centre, every relevant department and agency requires to be involved. The machinery of the entire government must act in concert, and conscious and systematic efforts made to marshal its combined energy, expertise and resource – as has been done only once before, for the green revolution.

This is a unique opportunity for India – to herald a remarkable turn in the fortunes of the rural poor, even, as many believe, a revolution.


1 The ministry of rural development monitors employment with reference to the households registered; the universe is not the rural households, nor even BPL households. Since many who need and seek work would not have been registered, the figures do not fully reflect the extent to which the employment guarantee has reached the poor.

2 The data for NE states indicates abnormally high expenditures for all States other than Arunachal Pradesh, Mizoram and Sikkim – the only three which are free from problems of violence and insurgency. These figures appear to need some verification.

3 The RTI Act has found an ally in the urban elite and within the bureaucracy – who have discovered its potential in resolving their own issues and problems. The clients of the NREGA (the poor) have no such advantage and must work their way to utilise the RTI Act.

december 29, 2007 Economic & Political Weekly

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