Reforms to the National Rural Employment Guarantee Act

(Mains GS 2 : Government Policies and Interventions for Development in various sectors and Issues arising out of their Design and Implementation.)

Context:

• The Central government has constituted a committee headed by Amarjeet Sinha to review the implementation of the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) scheme, especially to assess the programme’s efficacy as a poverty alleviation tool.

Changes in focus and governance structures:

• The Sinha committee has now been tasked to study the various factors behind demand for MGNREGA work, expenditure trends and inter-State variations, and the composition of work. 
• It will suggest what changes in focus and governance structures are required to make MGNREGA more effective. 
• MGNREGA critics slam the scheme for the lack of tangible asset creation, thus the committee will study if the composition of work taken up presently under the scheme should be changed and will review whether it should focus more on community-based assets or individual works.

Crucial safety net:

• Regardless of all the criticism, MGNREGA acted as a crucial safety net during the COVID pandemic. 
• In the financial year 2020-21, the number of person days of work provided under the scheme rose drastically to 389 crores, in comparison to the previous year’s figure of just 265 crore. 
• In 2021-22 too, the demand for MGNREGA work remained high, and 363 crore person days of work were generated.

Issues to tackle:

• In 2016, the Supreme Court of India directed the government to ensure that wages were paid on time, calling the act of making workers wait for wages for months as equal to “forced labour”.
• The Ministry of Rural Development must simplify the payment process and has to be transparent about pending wage payments in stage one and two so that bottlenecks can be corrected.
• Strengthen implementation capacities where expenditure is low instead of curbing expenditure where employment generation is high. 
• States which are spending more are implementing the programme better because they have better capacities (as several studies including the government’s own Economic Survey concluded in 2016). 
• For a universal, demand-based social security programme such as NREGA, reforms cannot be based on ‘targetting’ better. rather there has to be a focus on exclusion and not inclusion “errors”. 
• Thus instead of using expenditure and income poverty as the only markers, exclusion must be identified at the household level.

Demand-based law:

• Intermittent and unpredictable fund releases by the central government are one of the fundamental reasons why State governments are unable to ensure the full potential of NREGA. 
• As of today, ₹18,191 crore in liabilities is due to 24 States and poor performing States, on account of inadequate funds, typically discourage and often deny demand for work.
• Further the central government is concerned over the programme’s “regressive” spending pattern, where poorer States spend less NREGA funds than better-off ones.

Participatory reforms needed:

• NREGA emerged from the demands of a vibrant peoples’ movement across India and its cornerstones have been its path-breaking provisions for public accountability. 
• Building on the spirit of public participation, which gave NREGA an institutional architecture that was well before its time, is needed. 
• There has to be a leveraging of consultative processes and forums built into it, such as the State and Central Employment Guarantee Councils. 
• State governments have played a pivotal role in the successes and failures of NREGA, and any proposed reforms must be tabled in State assemblies in addition to Parliament along with bringing civil society organisations, worker unions and representatives of self-help groups into the discussion.

‘Top down’ reforms:

• It is time the Government of India makes an earnest attempt to map the impact of each of its “reforms” on access to and the expenditure of NREGA, particularly in poorer States. 
• A slew of “reforms” have disrupted implementation as the majority have focused on centralisation such as the electronic fund management system, geo-tagging of assets and a national mobile monitoring system (NMMS). 
• For example: Almost 3,000 women NREGA workers in Muzaffarpur district are protesting against the NMMS application after the app failed to capture their attendance.

Conclusion:

• Reforms to NREGA must prioritise the access of workers to entitlements with ease and dignity, rather than focus on administrative and fiscal efficacy alone.