Right to Work (MG-NREGA)

Right to Work (MG-NREGA)

 

Please click here to access the revised MGNREGA wage rates in various states for 2018-19

 

Please click here to access the Nagesh Singh Committee draft report on alignment of MGNREGA wages with minimum agricultural wages, submitted to the Ministry of Rural Development in July, 2017.

 

The key recommendations of the Nagesh Singh Committee draft report on alignment of MGNREGA wages with minimum agricultural wages are as follows:

• The Nagesh Singh Committee observed the fact that MGNREGA wages are currently indexed to CPI-AL of December month. The Committee recommended that the CPI-Rural Index for average of 12 months should be the proper index for indexing MGNREGA wages. This new indexation method could be followed for notification of wages to be effective from 01 April, 2018.

• The Nagesh Singh Committee recommended that the indexation of MGNREGA wages may be linked to Consumer Price Index for Rural India (viz. CPI-Rural), as the consumption basket of CPI-Rural is of more recent vintage than Consumer Price Index for Agricultural Labourers (viz. CPI-AL), although the CPI-Rural consumption weights pertain to 2004-05.

• In CPI-AL and Consumer Price Index for Rural Labourers (viz. CPI-RL), food beverages and tobacco account for over 70 percent of the consumption basket. In case of CPI-Rural, they account for only 59 percent. The CPI-Rural also provides for higher expenditure on Education, Medical care and Transport and Communication.

• The issue of divergence between wage rates under MGNREGA and minimum agricultural wages is on account of the fact that the states do not follow a uniform policy of wage revision for minimum agricultural wage.

• The Nagesh Singh Committee is of the opinion that the wage rates under MGNREGA are notified based on scientific principles of indexation. They should take into account the price level differences across states as the CPI-AL used for indexation of MGNREGA wages is taken for each state separately. The Committee felt strongly that the states should be persuaded to follow a uniform and scientific policy for indexation and notification of minimum wages for agricultural wages. In the Committee’s opinion, there is no compelling argument for convergence of minimum wages for agricultural labour and wages notified for NREGA workers in view of the differences in activities performed by these two set of workers which have been enumerated in the report.

Please click here to access the Prof. S Mahendra Dev Committee final report on MGNREGA wage rate indexation, submitted to the Ministry of Rural Development in 2015.

 

The key recommendations of the Prof. S Mahendra Dev Committee final report on MGNREGA wage rate indexation are as follows: 

• The baseline for MGNREGA wage indexation from 2014 may be the current minimum wage rate for unskilled agricultural labourers fixed by the states under the Minimum Wages Act or the current MGNREGA wage rate, whichever is higher
 
• The Consumer Price Index for Rural India (viz. CPI-Rural) may be considered as the appropriate index for protecting the wages against inflation and as such the CPI-Rural be adopted for revising wage rates every year under the Mahatma Gandhi National Rural Employment Act.

• A major drawback in using the Consumer Price Index for Agricultural Labourers (viz. CPI-AL) and the Consumer Price Index for Rural Labourers (CPI-RL) is that the weighting diagram is as old as 1983 since they are based on the weights derived from the consumer expenditure survey of that year. The Prof. Mahendra Dev Committee is of the opinion that the consumption pattern has changed significantly during the last 30 years. Given the thirty-year old weighting diagram, prices some of the items are not even available for data collection. In addition, new items of consumption must have also entered the consumption basket of the target groups. On the other hand, the weighting diagram for CPI-R is the recent 2004-05 consumer expenditure survey that would reflect the current pattern of consumption of the target groups. The prices of most of the items are collected for CPI-Rural.

• As CPI-AL and CPI-RL use old weights, cereals and products has 40 percent weight while the same thing for CPI-R was only 19 percent. In other words, food items have higher weights in CPI-AL and CPI-RL as compared to CPI-Rural.

• While the Labour Bureau of the Ministry of Labour and Employment, Government of India computes and publishes the CPI-AL and CPI-RL, the Central Statistical Organisation (CSO) of the Ministry of Statistics and Programme Implementation (MoSPI) computes and publishes the CPI-Rural. The present series of CPI-AL and CPI-RL take 1986-87 as the base year i.e. 1986-87=100.

• The CPI-AL and CPI-RL are compiled for 20 states and also for the entire nation on a monthly basis. However, the CPI-Rural is a newly constructed index and is being compiled from January, 2011 with 2010 as the base year. The CPI-AL covers the households of agricultural labourers and the CPI-RL covers the households of rural labourers (including agricultural labourers). The CPI-Rural, however, provides the price changes for the entire rural population of the country.
 


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