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KEY TRENDS 

• Total no. of households and persons who got themselves registered by 2010-2011 at the national level (as read on 1 February, 2011) are 11.62 crore and 25.38 crore respectively. Total no. of job cards issued by 2010-2011 at the national level (as read on 1 February, 2011) is 11.53 crore#

• Andhra Pradesh provided the maximum person days of employment by 2010-2011 (as read on 1 February, 2011) i.e. 27.48 crore to be followed by Tamil Nadu (22.44 crore person days) and Rajasthan (19.36 crore person days)#

• Employment generated during 2010-2011 at the national level as on 1 February, 2011 is 150.97 crore person days. Total no. of filled muster rolls is 1.55 crore during the same period as on 1 February, 2011#

• At the national level, NREGA generated 33.94 crore person days and 25.76 crore person days of work for Scheduled Castes (SCs) and Scheduled Tribes (STs), respectively during 2010-2011 as on 1 February, 2011. At the national level NREGA generated 75.14 crore person days of work for women during 2010-2011 as on 1 February, 2011. Women constitute 47%  while Scheduled Castes account for 28 %, and Scheduled Tribes 24% of the workers under Mahatma Gandhi NREGA in 2010-11. #

• Only 16,98,788 families completed 100 days of work during 2010-2011 at the national level as on 1 February, 2011#

• There are 8,97,192 no. of registered family at the national level to whom job card has not been issued in 2010-2011 as on 1 February, 2011##

• Out of 625 districts in the country, social auditing of NREGA has been started in 517 (i.e. 82.7%) districts. Similarly, out of 248380 gram panchayats in the country, social auditing of NREGA has been covered in 182724 (i.e. 73.6%) GPs*

• Total number of social audits done in the country as on 1 February, 2011 is 2,92,113 out of which issues were raised and action was taken in 92,145 (i.e. 31.54% of the total no. of social audits at the national level)) no. of social audits**

• All-India wise during 2010-2011, the average ratio of labour to material at the gram panchayat, block panchayat level and zilla panchayat levels are 2.59: 1.00, 1.14: 1.00 and 1.51: 1.00, resepectively as on 1 February, 2011. Ideally, the ratio of labour to material should be 1.50: 1.00 (i.e. 60: 40). At the national level, ratio of labour to material is 2.40: 1.00 during 2010-2011 as on 1 February, 2011** 

• With a view to universalise the system of wage payments through institutional accounts, it has been recommended to all States to disburse wages through Post Offices and Bank Accounts. 6.86 crore NREGA bank and post office accounts have been opened to disburse wages in FY 2008-09***

• The number of NREGA bank and post office accounts opened has risen to 8.8 crore 80 % of wages is being disbursed through these accounts. Initial experiments in the use of smart cards and biometric signatures for wage payment to NREGA workers in remote villages are being supported***

# Employment Generated during the Year 2010-2011,
http://164.100.12.7/netnrega/writereaddata/citizen_out/DemRegister_1011.html

## List Of Registered Family To Whom Job Card Is not Issued 2010-2011,
http://164.100.12.7/netnrega/writereaddata/state_out/stregnojoball_1011.html

* Social Audit report,
http://164.100.12.7/netnrega/state_html/social_auditNT.aspx?fin_year=2010-2011

** Labour to Material Ratio Analysis for The Financial Year 2010-2011,
http://164.100.12.7/netnrega/writereaddata/state_out/wrk_mat_analysistemp_1011.html

*** Mahatma Gandhi National Rural Employment Guarantee Act, 2005, Report to the People, 2nd February, 2006-2nd February, 2010, http://nrega.nic.in/circular/Report_to_the_people.pdf

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According to Social Protection for a Changing India (May, 2011), The World Bank, http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2011/04/20/000333037_20110420235516/Rendered/PDF/612750v10ESW0P1rt0Volume0I01PUBLIC1.pdf:  

•    During 2009-10, Rs. 30100 crore was allocated under Mahatma Gandhi National Rural Employment Guarantee (MGNREG) Scheme. It covered 33 percent of rural households in 2008-09.

•    Administrative data and field studies suggest both significant successes in NREGS relative to previous public works programs (e.g., high coverage of rural households, with impressive inclusion of SC/ST and women workers) and many challenges in translating improved program design into outcomes for the poor, such as, matching demand for work with the administrative demands of opening worksites; aligning piece rate compensation with the minimum wage requirement; strengthening mechanisms for community participation in works identification and oversight.

•    The number of households to whom job cards were issued under NREGS went up from 38 million in 2006-07 to 65 million in 2007-08 and further to 100 million in 2008-09.

•    The number of households who demanded employment under NREGS went up from 21 million in 2006-07 to 34 million in 2007-08 and further to 45 million in 2008-09.

•    The percentage of rural households who were provided employment under NREGS has gone down from 39 percent in 2006-07 and 2007-08 to 33 percent in 2008-09.

•    The number of person days employment generated has gone up from 905 million in 2006-07 to 1437 million in 2007-08 and further to 2163 million in 2008-09.

•    The number of households who were provided 100 or more days of employment went up from 2 million in 2006-07 to 4 million in 2007-08 and further to 7 million in 2008-09.

According to Progress in providing employment for the poor: The national public works programme in India (2010) by Rebecca Holmes, Jenny Morgan and Jessica Hagen-Zanker, Overseas Development Institute, http://www.developmentprogress.org/sites/default/files/india_report_-_master.pdf:  

•    MGNREGA’s participatory approach is supported by a three-tiered system of governance called the Panchayati Raj system.

•    Registration for MGNREGA is undertaken at the lowest tier of local government – the gram panchayat – which means that more people have been able to access the service and register for job cards. Gram panchayats estimate the local demand for work, suggest suitable projects, issue job cards for new job seekers, monitor worksites and implement works. Payment for work is made through banks or post offices, which can be opened free of charge, which adds to the accessibility of MGNREGA.

•    Intermediary panchayats then ensure that job seekers are provided work within 15 days, and identify appropriate works if the gram panchayat fails to do so. Finally, district panchayats are required to develop five-year plans based on overall district needs and to coordinate MGNREGA activities at the district level.

•    Domestically financed, MGNREGA has scaled up rapidly, from 200 districts in 2006 to national coverage in 2008. It now reaches over 40 million households and has created over 1.7 billion person days of employment. MGNREGA is the only rights-based employment guarantee programme in the world, and it has stimulated the development of a range of similar initiatives in other countries in the South Asian region.

•    The budget allocated to MGNREGA has increased as the programme has expanded nationally. In the first fiscal year of the Act, 2006/07, expenditure was $1.76 billion. In 2009/10, $6 billion was allocated. This amounts to around 0.5% of GDP, 3.3% of budget expenditure and 10% of planned expenditure.

•    In 2009/10, over 43 million rural households in India demanded work. Of these, 99% were provided with work.

•    During 2009/10 in Rajasthan, over 344 million person days have been created, in Uttar Pradesh over 248 million and in Tamil Nadu over 222 million.

•    In 2009/10, a national average of only 7% of households employed under MGNREGA completed 100 days of work. Rajasthan, Uttar Pradesh and Tamil Nadu were more successful than other states in this regard, providing the full 100 days to 12%, over 14% and 7% of households, respectively.

•    SCs and STs represent 14% and 8% of the population in India, respectively, but their representation in MGNREGA is almost 20%. MGNREGA also prioritises works on irrigation facilities on land owned by households belonging to SCs/STs or on land of the beneficiaries of land reform. In 2008/09, 20% of MGNREGA works supported the provision of irrigation facilities on land owned by SCs/STs, compared with 10% in 2006/07 and 15% in 2008/09, suggesting that this focus is an increasing priority.

•    Specific provisions to support women’s participation in MGNREGA include priority to work on sites close to home (within 5km) and provision of childcare facilities. Overall, women represented 48% of participants in 2008/09 and 46% of participants in 2009/10.

•    In Rajasthan and Tamil Nadu, the proportions of women receiving days under MGNREGA were much higher than the national average, at 64% and 78%, respectively, whereas in Uttar Pradesh it was much lower, at only 14%.

•    Many factors influence the number of women employed in MGNREGA, including existing cultural and social norms, wage rates and the provision and quality of child care facilities.

•    In some states, cultural norms prevent women from working outside the home or working with men, reflected in household decisions to send only men for MGNREGA work, thereby denying women’s rights to access employment days (Samarthan Centre for Development Support, 2007). Entrenched ideas about the gender division of labour also affect the type of work seen as acceptable for women to do.

•    Studies also show that, even when women want to work, the panchayat may have excluded them because of social norms around the ‘appropriate’ type of work for women (Khera and Nayak, 2009). In Madhya Pradesh, for example, although women’s representation overall is above 40%, in practice women receive fewer days on MGNREGA because they are not involved in all types of work available. Women are often given ‘soft’ work such as throwing out the soil from digging wells, which requires fewer days.

•    Evidence from Andhra Pradesh demonstrates that MGNREGA can reduce vulnerability to external shocks, in particular weather-related shocks, which affect agricultural productivity in India, by smoothing income and consumption.

•    Johnson (2009) finds that MGNREGA participation in the lean season responds to weather-related shocks in the wet season, with more households participating in MGNREGA (although not necessarily for more days). The study also finds that participation levels in MGNREGA are more responsive to weather-induced shocks than other government welfare programmes.

•    Another important benefit of MGNREGA in reducing vulnerability has been an increase in household wage income. Average household wage income increased from Rs. 2,795 in 2006/07 to Rs. 4,060 in 2008/09.

•    Drèze and Khera (2009) find that MGNREGA also supports household health. A survey of six states in northern India found that the majority (57%) of the sample workers had used a part of their wages to buy medicine or treat an illness in the family. In Andhra Pradesh, 13% of household earnings from MGNREA are spent on health security (Kareemulla et al., 2009).

•    The increase in the average wage has also supported rural purchasing power and boosted overall spending, particularly in the face of drought and higher food prices. Mahambare (2010) finds that MGNREGA-generated consumption expenditure amounted to nearly 1.4% of total rural consumption and nearly 1% of total household consumption in India in 2010, nearly doubling its share since 2007/08. Dev (2009) argues that employment on MGNREGA also helped cushion the impact of the recent food price crisis. Although food prices in India did not rise as sharply as in other countries, because of India’s food management policies, they were slightly higher than normal. MGNREGA resulted in higher purchasing power and generated demand for food in rural areas.

•    Evidence from a study carried out in 2008 by the Centre for Science and the Environment (2008) suggests that assets and infrastructure have reduced vulnerability to food insecurity and improved livelihood opportunities. In Nuapada district in Orissa, where people are highly dependent on forest land, 43% of the community felt that the availability of fuel wood and/or fodder had increased as a result of MGNREGA works. A total of 15% of respondents had also diversified their crop mix from paddy and biri to produce groundnut, millet and vegetables, and 15% of the population reported that MGNREGA had led to increased water availability.

•    The same study found that, in Sidhi, in Madhya Pradesh, MGNREGA works had reduced the population’s dependence on the forest by providing alternative livelihood options. MGNREGA works have also improved access to better irrigation facilities, which has impacted positively on agriculture in the area. MGNREGA has been responsible for the construction of ponds, tanks and wells on SC and ST land. Respondents also reported crop diversification into vegetables. A total of 78.6% of respondents felt that MGNREGA works had led to increased water availability.

•    Similar results were found by a 2007 study by the Samarthan Centre for Development Support (2007) in Uttar Pradesh, where 30% of respondents highlighted increased food security and improved diets, particularly for children, as a result of MGNREGA employment.

•    Kareemulla et al. (2009) found that, in Andhra Pradesh, 18% of household earnings from MGNREGA is spent on education. Similarly, the Samarthan Centre for Development Support (2007) found that households use MGNREGA wages to increase access to and improve quality of children’s education, by paying admission fees, purchasing books, providing tuition and buying school uniforms. In Uttar Pradesh, improved road connectivity has enabled children to attend school more regularly by bicycle or on foot.

•    Uppal (2009) found that child labour decreases with parents’ registration and participation in MGNREGA. Meanwhile, child health as measured by anthropometric measures improves when parents register and work for MGNREGA.

•    In Gujarat, Madhya Pradesh and Jharkhand, it was found that the bribe that local officials demand for an application form for a job card may range from Rs. 5 to Rs. 50, where a day labourer may earn only Rs. 60 or so.

•    The demand-led nature of the programme also entails complicated calculations, as the number of households that will apply for MGNREGA and therefore the amount of work to be allocated cannot be guaranteed. In Madhya Pradesh, Holmes et al. (2010) found that, in practice, MGNREGA was supply- rather than demand driven, with panchayats allocating work to households rather than households applying for it when needed.

•    Limited staff capacity and skills in implementing MNGREGA result in serious deficits in effectively delivering employment for the rural poor. Ambasta et al. (2008) suggest that MGNREGA is constrained by a lack of professionals, in particular programme officers, who were to be appointed at state level to support implementation, and accredited engineers, also to be appointed at state level to support timely and transparent costing of works to be undertaken. In many cases, the capacity of the panchayats is lagging. As one interviewee stated: ‘the panchayats are the weakest link in the roll out of NREGA’ (Holmes et al., 2010). In addition, Drèze (2009) reports routine violations of the entitlements of MGNREGA workers, ‘whether it is their entitlement to work on demand, or to minimum wages, or to payment within 15 days, or to basic worksite facilities.’

•    There is limited civil society activity in some states. A survey undertaken by Drèze and Khera in 2009 reported still very low awareness levels among MGNREGA workers of their rights, including employment on demand; minimum wages; payment within 15 days; and basic worksite facilities. This is linked to low levels of civil society intervention.

•    During the 1990s, India faced the lowest growth rate of rural employment since independence, with annual growth of rural employment falling from 2.03% to 0.67% over the period 1993/94 to 1999/00, directly attributed to the stagnation of agricultural employment (Pal and Ghosh, 2007).

•    According to National Sample Survey (NSS) data, there was a very large increase in landless households as a percentage of total rural households, from around 35% in 1987/88 to as much as 41% in 1999/00.

•    As growth has accelerated in India over the past few decades, poverty has declined. In the 1970s and 1980s, poverty rates fell rapidly, in large part because of the agricultural ‘green revolution’ in the 1970s. Poverty declined from 64% in 1967 to 50% in 1977 and to 34% in 1986.

•    In 2004/05, the number of people still living in poverty was 28% and, because of population growth, the absolute number of poor people has declined only marginally, from 320 million in 1993/94 to 302 million in 2004/05.

•    In April 2010, the Planning Commission of India (PCI) accepted a new methodology for estimating poverty, which pushed the proportion of people living below the revised poverty line to 37.2%.

•    Poverty rates remain highly concentrated in rural areas in absolute numbers, because 75% of the population lives in rural areas. Poverty is also highly correlated with particular social and ethnic groups. Owing to the hierarchical and unequal nature of the caste system, Scheduled Castes (SCs), Scheduled Tribes (STs) and Other Backward Castes (OBCs) are denied access and entitlements to economic, civil, cultural and political rights. Data from 2000 show that the poverty headcount in rural areas was highest among SCs and STs (45.8% and 35.9%, respectively) compared with 21% among non-SCs/STs.

•    The rural poor remain highly reliant on agricultural day labour work. The proportion of casual workers increased from 65% in 1972 to 80% in 2002 among male wage earners, and from 89% to 92% among female wage earners.

•    In terms of numbers, India has 82 million landless rural households dependent on agricultural wage employment, as well as 80 million marginal farmers with low asset positions, who turn to off-farm work for survival.

•    According to the United Nations Development Programme (UNDP, 2009), 41.6% of India’s population is living in poverty according to the $1.25 poverty line. However, the national poverty line puts the number at a lower 28.6% of the population (over 300 million people).

According to the Highlights of Quarterly Progress Report on National Rural Employment Guarantee Act (NREGA), Rural Development Ministry, 15 September, 2009, http://www.pib.nic.in/release/release.asp?relid=52639, http://www.pib.nic.in/release/release.asp?relid=52648

1. Evolving the design of the wage employment programs to more effectively fight poverty, the Central Government formulated the National Rural Employment Guarantee Act (NREGA) in 2005. 

2. New initiatives: To continue focus on critical issues and priority areas highlighted by the President to strengthen NREGA, the Ministry has held high level workshops and extensive consultations.  The action taken by the Ministry is as follows:      

• District Level Ombudsman: Instructions on Ombudsman have been issued. The Ombudsman will be appointed by the State Government on the recommendation of the selection committee. Ombudsmen will be well-known persons from civil society.  The Ombudsman will receive complaints from NREGA workers and others on any matters, consider such complaints and facilitate their disposal in accordance with law. 

• NREGA partnership with Unique Identification Development Authority of India (UIDA): NREGA partnership with UIDA has been initiated. 

• Social Audits: Social Audit is an important tool by which the people can improve and devise strategies to enhance the quality of implementation of NREGA. The Act was amended to provide for procedures on conducting social audits. 

• Independent Monitoring Mechanisms: 100 eminent citizens will be identified to further report on the progress of NREGA. 

• Convergence: The Ministry of Rural Development has developed and disseminated guidelines for convergence of NREGS with different Schemes and specific programmes. 115 pilot districts in 23 states have been identified for convergence. 

• Enlarge the scope of works permitted under NREGA presently limited to unskilled manual labour:  The Act has been amended to include provision of irrigation facility, horticulture plantation and land development facilities to land owned by households of the small farmers or marginal farmers.

• NREGA has the potential to diminish the adverse impact of drought by placing purchasing power in the hands of the people. Advisories were issued to all 11 drought affected states to ensure that adequate funds and shelf of project have been made available to the Districts.

• 115 pilot districts in 23 states have been identified for convergence among various rural development programs of the ministry. He also informed that the scope of works permissible under NREGA has been enlarged to include the provision of irrigation facility, horticulture plantation and land development facilities to land owned small or marginal farmers. Efforts have been made to protect the non negotiable instruments in the act. Gram Panchayats have been asked to ensure that works on lands of SC / ST and BPL receive first priority. Provision of Ombudsman at district level, setting up of Eminent Citizen’s Panel along with the reports from the National monitors will play a a major role in the monitoring of implementation of the Act.

• Efforts are on to upgrade the capacity of NIRD for better training in rural development and governance reforms are being undertaken to upscale the capacity of CAPART. NIRD and CAPART have been assigned the responsibility to prepare training modules for flagship programs.

According to Chakraborty, Pinaki (2007): Implementation of the National Rural Employment Guarantee Act in India: Spatial Dimensions and Fiscal Implications, Bard College, http://papers.ssrn.com/sol3/papers.cfm

• The National Rural Employment Guarantee Act (NREGA) was enacted by the Indian Parliament in 2005 to provide a minimum guaranteed wage employment of one hundred days in every fiscal year to rural households with unemployed adult members prepared to do unskilled manual work.

• In the past, public employment programs in India targeted at the poor were generally identified with the poverty alleviation. NREGA goes beyond poverty alleviation and recognizes employment as a legal right. The only example of guaranteed state-sponsored employment in India is the Maharashtra Employment Guarantee Scheme, which was enacted and implemented under the extraordinary circumstances of severe drought in the state during 1970 to 1973 as innovative anti-poverty intervention.

• NREGA goes beyond poverty reduction and recognizes employment as a legal right. Skeptics considered it as a populist measure while others have considered it as a landmark initiative towards poverty alleviation and empowerment of poor.

• During the 1980s and 1990s, one would observe that during the tenth Five Year Plan, the growth rate of employment has slowed down considerably.  The annual rate of growth of rural employment was around 0.5 percent per annum between 1993–94 and 1999–2000, as compared to 1.7 percent per annum between 1983 and 1993–94 and also the current daily status unemployment rate in rural areas increased from 5.63 percent in 1993–94 to 7.21 percent in 1999–2000.

• The deceleration in employment growth was further reinforced by a sharp cut back in public spending on rural employment programs (Dev 2002). In this context, the enactment of NREGA is appropriate and timely. Although, the aggregate employment figure shows a decline, national sample survey estimates of unemployment rates in 1999–2000 showed that the rate of unemployment in “usually unemployed” category in 1999–2000 was only 2 percent for the male labor force and less than 2 percent for the female labor force.

• Despite low unemployment rates, the incidence of income poverty in rural areas is at least four times the incidence of unemployment as per the current daily status, which implies that the number of poor far outweighs the number of poor for want of work

Provisions of NREGA

The various provisions of the NREGA are the following: (i) it provides at least one hundred days of guaranteed wage employment in every fiscal year for at least one adult member of every household prepared to do unskilled manual labor at the wage rate specified by the state government; (ii) creation of durable assets and strengthening the livelihood resource base of the rural poor shall be an important objective of the scheme. The state council shall prepare a list of permissible works, as well as a list of “preferred works”; (iii) the program may also provide, as far as possible, for the training and upgradation of the skills of unskilled laborers; (iv) wages may be paid in cash, in kind, or both, provided that at least one-fourth of the wages shall be paid in cash only; (v) employment shall be provided within a radius of five kilometers of the village where the applicant resides at the time of applying. In cases where employment is provided outside such radius, it must be provided within the block, and the laborers shall be paid 10 percent of the wage rate as extra wages to meet additional transport and living expenses; (vi) in case the number of children below the age of six years accompanying the women working at any site is five or more, provisions shall be made to depute one women worker to look after such children. The person deputed for this shall be paid the statutory minimum wage; and (vii) a proportion of the wages, not exceeding 5 percent, may be deducted as a contribution to welfare schemes organized for the benefit of laborers employed under the program, such as health insurance, accident insurance, survivor benefits, maternity benefits, and social security schemes

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The Performance Audit of the implementation of NREGA by the Comptroller and Auditor General of India, cag.gov.in/html/reports/civil/2008_PA11_nregacivil/Exe-sum.pdf show:

• A Performance Audit of the implementation of NREGA in the initially notified 200 districts was taken up during May–September 2007, in response to a request from the Ministry of Rural Development, so as to provide assurance that the processes under the Act were put in place and were being adopted effectively by the State Governments.

• Of the total available funds of Rs. 12074 crore (including the States’ share of Rs 813 crore) upto March 2007, the State Governments could utilize Rs. 8823 crore (73 per cent)

• According to the Ministry of Rural Development’s figures, 3.81 crore households had registered under the Act, Out of these, while, 2.12 crore households had demanded employment, 2.10 crore households were provided employment during 2006-07.

• The applications for work are to be submitted primarily at the Gram Panchayat, and it was crucial to maintain proper records of employment demanded, employment provided, number of days of employment generated, entitlement for employment allowance etc. However, the examination of field-level records by Audit reveled that record maintenance, particularly at GP level was poor, demonstrating the lack reliability and authenticity of the reported figures. Also, as the applications for demand for work were not documented or dated, and dated receipts for such applications were not issued in most cases, the eligibility of rural households for unemployment allowance, in these cases, was unverifiable. This would indicate that there is a high probability of only partial capturing of the demand for work.

• There were several cases of delayed payment of wages, for which no compensation was paid. While there was a high probability that all demands for work were not being captured, there were also instances of non-payment of unemployment allowance, which became due to employment seekers even where the records indicated that demand was not provided within 15 days from date of demand. Yet no one was fined for the violation of the Act. This indicates lack of an effective grievance redressal mechanism which defeated the very purpose of the Act of conferring a statutory right on the rural households for demanding upto 100 days of employment.

• The poor record maintenance further diluted the purpose of the Act as in the absence of dated acknowledgement of the application for work, there was no way the employment seekers could prove denial of demanded work and could claim entitlement for unemployment allowance.

• Systems for financial management and tracking were deficient, as monthly squaring and reconciliation of accounts at different levels to maintain financial accountability and transparency was not being done. The status of inspection of works, and holding of Gram Sabhas to conduct Social Audit Forum was also not up to the mark.

• Subsequent to the original audit, some of the sampled districts were revisited to check the improvement in maintenance of records in February-March 2008, covering 24 GPs in 12 blocks in 12 districts in 6 States from within the original audit sample. The scrutiny revealed that while there was a definite improvement in record maintenance especially in Uttar Pradesh after the conduct of initial audit, the maintenance of basic records at the GP level, in particular the employment register was still deficient and there was considerable scope for improvement.

Funding of NREGA

Present status

According to the Comptroller and Auditor General’s Performance Audit Report No. 11 of 2008, cag.gov.in/html/reports/civil/2008_PA11_nregacivil/introduction.pdf

• The Governments of Arunachal Pradesh, Chhattisgarh, Gujarat, Haryana, Himachal Pradesh, Jammu & Kashmir, Jharkhand, Kerala, Maharashtra, Manipur, Punjab, Rajasthan and Tamil Nadu (13 States) did not formulate rules for carrying out the provisions of the Act as of March 2007

• The Governments of Arunachal Pradesh, Andhra Pradesh, Assam,  Chhattisgarh, Gujarat, Jharkhand, Karnataka, Kerala, Madhya Pradesh, Manipur,  Nagaland, Orissa, Punjab, Sikkim, Uttarakhand and West Bengal (16 States) did not prescribe the time frame for each level i.e. GP, Block and District levels for proposing, scrutinising and approving REGS works

• While 18 State Governments had designated an officer as State Rural Employment Guarantee Commissioner, the State Governments of Arunachal Pradesh, Himachal Pradesh, Karnataka, Nagaland, Tripura, Uttar Pradesh  and Uttarakhand (7 States) had not done so as of March 2007

• The Governments of  Arunachal Pradesh, Assam, Bihar, Haryana, Himachal Pradesh, Jammu & Kashmir, Jharkhand, Karnataka, Madhya Pradesh, Maharashtra, Meghalaya, Nagaland, Orissa, Punjab, Sikkim, Tamil Nadu, Tripura, Uttar Pradesh, Uttarakhand  and  West Bengal (20 States) did not appoint full-time dedicated Programme Officers (POs) in 102 test checked blocks. The existing Block Development Offices (BDOs) were appointed as POs and given the additional charge of the Scheme

• Out of 68 districts test checked, District Perspective Plans (DPPs) were not prepared by 40 districts in Assam, Bihar, Chhattisgarh, Gujarat, Haryana, Himachal Pradesh, Jharkhand, Karnataka, Kerala, Maharashtra, Manipur, Punjab, Tamil Nadu, Tripura, Uttar Pradesh, Uttarakhand and West Bengal (17 States)

• Door-to-door survey to identify persons willing to register was not conducted in 323 Gram Panchayats in Andhra Pradesh, Assam, Bihar, Chhattisgarh, Haryana, Himachal Pradesh, Jammu & Kashmir, Jharkhand, Karnataka, Kerala, Maharashtra, Manipur, Nagaland, Orissa, Punjab, Rajasthan, Tamil Nadu, Uttar Pradesh, Uttarakhand and West Bengal (20 States)

• Delays in issue of job cards were noticed in 196 Gram Panchayats in Andhra Pradesh, Assam, Bihar, Chhattisgarh, Haryana, Himachal Pradesh, Jharkhand, Kerala, Maharashtra, Manipur, Orissa, Sikkim, Tamil Nadu, Uttar Pradesh, Uttarakhand and West Bengal (16 States)

• Photographs of the applicants were not attached to job cards in 251 Gram Panchayatss in Andhra Pradesh, Assam, Bihar, Chhattisgarh, Haryana, Himachal Pradesh, Jharkhand, Madhya Pradesh, Maharashtra, Orissa, Uttar Pradesh, Uttarakhand and West Bengal (13 States)

• In 19 districts in Bihar, Chhattisgarh, Haryana, Himachal Pradesh, Jharkhand, Orissa and Uttar Pradesh (7 States), the wages-material ratio of 60:40 was not maintained at the district level

• The Governments of Arunachal Pradesh, Assam, Bihar, Chhattisgarh, Haryana, Himachal Pradesh, Jharkhand, Karnataka, Kerala, Manipur, Meghalaya, Punjab, Sikkim, Tripura, Uttar Pradesh, and Uttarakhand (16 States) did not prepare separate District-wise Schedules of Rates (DSRs) specifically for NREGA works

• In 79 Gram Panchayats in Andhra Pradesh, Bihar, Chhattisgarh, Jharkhand, Kerala, Madhya Pradesh, Maharashtra, Manipur, Orissa, Punjab, Rajasthan and Tamil Nadu (12 States), the workers, even after working for seven hours, were paid wages less than the minimum wage rate

• In 213 Gram Panchayats in Andhra Pradesh, Bihar, Chhattisgarh, Haryana, Himachal Pradesh,  Jharkhand, Karnataka, Kerala, Madhya Pradesh, Manipur,  Orissa,  Rajasthan, Sikkim, Tamil Nadu, Uttar Pradesh, Uttarakhand  and West Bengal (17 States), workers were not paid wages on time i.e. within a fortnight of the date on which the work was done. No compensation was paid to them

• Audit scrutiny in 58 blocks in Arunachal Pradesh, Bihar, Chhattisgarh, Himachal Pradesh, Jharkhand, Karnataka, Kerala, Manipur, Meghalaya, Nagaland, Orissa, Punjab, Rajasthan, Sikkim, Tripura, Uttar Pradesh and Uttarakhand  (17 States) revealed that unemployment allowance was not paid to those workers, who could not be provided with employment within 15 days from the date on which work was requested for

• In 246 Gram Panchayats in Assam, Bihar, Haryana, Himachal Pradesh, Jharkhand, Karnataka, Kerala, Manipur, Nagaland, Orissa, Punjab, Uttar Pradesh, Uttarakhand and West Bengal (15 States), copies of muster rolls were not available for public scrutiny in the Gram Panchayats

According to the Centre for Science and Environment, www.cseindia.org,

• Governments have failed to articulate the Act’s development potential. Instead of implementing and evaluating the Act purely in terms of employment creation, the focus should have been on the real impacts on local development through productive assets creation

• Irrational wage calculations have made projects like water conservation less lucrative

• Out of a total of 769,582 works under progress, only 158,277 (20.56 per cent) have been completed. Till August 2007, only about 14 per cent of water conservation works under NREGA had been completed.

• In fact, road construction projects were getting done at a faster rate

• Bad planning for water conservation structures is putting a large number of the assets created into disuse. For instance, water-harvesting structures have been created without any provision for catchment protection. On top of this, ‘maintenance work’ does not come under the ambit of NREGA as a permissible activity. As a result, districts, which already have large numbers of water harvesting structures and want to use NREGA money for their maintenance, can’t do so

The study titled “Evaluating Performance of national Rural Employment Guarantee Act”, which has been done by Public Interest Foundation (PIF) and National Council of Applied Economic Research (NCAER) show,

http://www.publicinterestfoundation.com/index.php?option=com_content&task=view&id=47&Itemid=49

http://www.hindustantimes.com/StoryPage/StoryPage.aspx?sectionName=NLetter&id=afbf7ea0-234e-4572-ba5c-5404e635d3b7&Headline=Shady+data%2c+sloppy+work%3a+study+slams+NREGA

• There has been data manipulation that falsely portrays a healthy picture of employment generated through the scheme.

• Provision of employment to 10 per cent households in the official data is also doubtful because independent surveys, social audits, and field studies have revealed several cases of data manipulations which explains why national and state level data on employment against demand shows a rather healthy demand

• There were a large number of districts in many states, where the number of households that have been issued job cards is more than the total number of households in these districts

The study has made the following recommendations:

Responsibility of Government of India to provide funds through an easy and convenient mechanism

• In the present funding pattern GOI provides funds to the states to meet full cost of wages and upto 75% of the material cost of work including wages to skilled and semiskilled workers. (subject to material-wage ratio not exceeding 40:60); release of funds is made not to the state but directly to each district. This system involves need for detailed calculations and scrutiny of figures of expenditure on wages, material component and staff. It also entails heavy workload in having to keep district-wise accounts. This cumbersome procedure compels district officers to make frequent visits to Delhi to chase their proposals for release of funds.
• The whole process can be greatly simplified by having a new funding pattern in which central government meets full cost of employment wages and in addition funds equal to 50% of wages are given towards all other costs (including material component, staff etc). This simple pattern of funding would dispense the need for getting from states details of expenditure on material, staff etc. or having to calculate the wage-material ratio in REGS works. Also, the release of funds should be to the state and not directly to the district; on-account automatic release of funds to the states will be based on the Utilization Certificate of earlier released funds given by the finance department of the state.  GOI will then be concerned with maintaining only state-wise accounts and not nearly 600 accounts for the districts.
• The above on-account automatic fund release mechanism should be backed by an efficient system of timely post-release checking of accounts of the states by the Inspection team deputed by the Centre. REGS should also provide for half-yearly audit of accounts by the State Audit and annual audit by C & AG

According to the Digging holes and filling them in again? How far do public works enhance livelihoods? by Anna McCord and John Farrington,

http://www.odi.org.uk/resources/download/2571.pdf

Problems with the implementation of NREGA

• Low utilisation of available funds: central government provides 90% of the funding for NREGA, but on average, the States used 71.5% of funds in FY 2006/7, with some under 50%
• Low and intermittent provision of work: a national average of 43 employment days per benefited family in 2006/7; failure to meet the target of one-third women beneficiaries in 11 of 27 States; intermittent provision of work, often clashing with main agricultural activities.
• Implementation difficulties, including absence of social audits and inadequate focus of public works on priority areas such as water conservation, drought proofing and plantations; non-implementation of workplace facilities and unemployment benefit
• Low awareness of the Act’s provisions among intended beneficiaries, beyond the “100 days of work” provision
• Misappropriation of funds in the process of issuing job cards and registering workers on specific jobs; diversion of funds to unauthorised works

Long term public works in India – the National Rural Employment Guarantee Act (NREGA):

Main features

• The basic objectives of NREGA, passed in September 2005, are essentially long-term, namely to enhance livelihood security in rural areas; as well as creating productive assets, protecting the environment, empowering rural women and fostering social equity.
• Its budget in FY 2006-07 was Rs113bn, rising to Rs. 120bn for 2007-08 (approximately US$3bn, equivalent to some 0.4% of GDP). It is intended ultimately to benefit some 54 million of the poorest rural workers, initially in 200 poor districts (expanded to 330 districts – approximately two-thirds of the districts in the country – from April 2007).

The Act builds on earlier experience with Employment Guarantee in Maharashtra. Apart from affirming the ‘right to work’, it also seeks to ensure that the poor have a voice in decisions on the works to be undertaken, so that such works contribute to their livelihoods. The core features of the Act are:

• Registration by unskilled workers with local government for a job card which is valid for at least five years.
• The provision of not less than 100 days of local (i.e. within a 5 km radius) wage employment per registered household, on demand, in a financial year.
• At least one-third of the wage seekers to be women.
• Payment of the statutory minimum agricultural wage, with equal wages paid to men and women.
• Contractors and labour displacing machinery not to be engaged. Only works approved by local government to be taken up.
• Provision of unemployment allowance if an applicant is not provided with work within fifteen days of receipt of his/her application for employment.
• Provision of work site facilities such as safe drinking water, child care, shelter and first aid. In case of accidental injury while working, the injured person is entitled to medical treatment free of charge.

Best Practices on Financial Inclusion in NREGA

Source: Chapter 1: NREG Scheme, page 10, Annual Report 2007-08, Ministry of Rural Development, Government of India 

Gulbarga District – Karnataka

The district has a population of 31.30 lakhs. There are 337 gram panchayts and 1363 villages. The total number of households is 3.89 lakhs out of which 2.15 lakhs households have been issued Job Cards under NREGA. 3000 works have been taken up during the current year (2007-08) as against 3259 works taken up last year (2006-07). In total, Rs. 19.05 crores have been spent under NREGA during the current financial year as against Rs. 34.02 crores spent last year. Till now, 62,313 accounts in post offices, 157,687 in commercial banks and 17,946 accounts in Co-operative banks have been opened. Almost 90 villages have banks and 752 villages have banks within 5 Km (51.17%), whereas 345 villages have banks within 5-19 Km (25.97%).

East Godawari District-Andhra Pradesh

The State Department of Rural Development and Department of Posts, A.P. Circle have entered into MoU for payment of wages through Post Office Saving Account. 4,17,154 postal saving accounts have been opened against 3.5 lakh persons reporting for NREGS works. Fortnightly, co-ordination meetings are conducted between district administration and representative of department of posts at district level and block level. The Programme Officers generate wage payment orders and issue cheques and hand them over to sub post masters every Monday. They also facilitate the sub post masters and branch post masters in receiving the cash. Every Friday the wage seekers withdraw amount from their postal accounts. Since inception, 77.2% of payments are being made within 15 days of closer of Muster Rolls.

Dumka District - Jharkhand

In Dumka District, payment of wages is made through Banks. On the basis of corrected Muster Rolls, cheques are transferred to respective banks. Outstation cheques take about 15 days for clearance. For smooth payment, accounts have been opened by the all the agencies in almost all the bank branches so that labourers get payments on the same day without any delay. District administration has also developed a system to ensure smooth payment through Post Office. Muster Rolls are collected and advice prepared accordingly. Fund assessment is made from particular day from each post office and the same amount is deposited in cash in the respective branch post office. A specific day is fixed for group of labourers for a particular group of schemes for wages payment through post office. Prior information is given to the labourers about the time and date of payment for a particular post office. On that particular day wages payment is ensured in the presence of respective Panchayat Sewak/ Rojgar Sewak/ Junior Engineer/ Supervisor, etc.

Success story on NREGA

According to The Challenge of Employment in India: An Informal Economy Perspective, Volume-I, Main Report, National Commission for Enterprises in the Unorganised Sector (NCEUS), April, 2009, http://nceus.gov.in/

The performance of the scheme in the state of Andhra Pradesh has been laudable because of strong political will and also because the state has had a rural worker and community mobilization movement. In addition, Andhra Pradesh has successfully employed computerization and e-governance mechanisms for monitoring the scheme. For, example, funds are being transferred electronically; every jobs seeker has got a bank account and wages are paid through bank or post office account; the whole process from job application to registration is computerized.

In Rajasthan, which has the history of drought relief based public employment and active civil society, the success of NREGA is more impressive compared to other north Indian states. Dungarpur district was able to make NREGA more of a success because of the presence of effective grassroots NGOs and their ability to mobilize the poor. Further, in Rajasthan, the innovative arrangement of having a ‘mate’ supporting worksite management has led to greater productivity of workers, easier worksite supervision and greater transparency in maintaining of work related records. Facilitation of the scheme by the local civil society organisation, the Jagrut Adivasi Dalit Sangathan (JADS) in Pati block of Madhya Pradesh bears testimony to public action from below to inculcate the practice of work on demand through application, receipts at the time of submission of applications and ensuring the payment of unemployment allowance, if necessary.

In Kerala, the NREG implementation pivots around the Kutumbashree (Self Help Groups of poor women). These women are not only involved in identifying the public work projects, but also overseeing the implementation. Besides Kerala has also used banks and post offices for wage payment. All these have resulted in high participation rate of women and an overall efficient system. Manifold increase in the number of work days, reduction in distress out-migration, enrolment in schools were observed in a study of 8 states by Indian School of Women’s Studies and Development, New Delhi.

In the tribal dominated and backward district of Pakur in Jharkhand, customized information, education and communication (IEC) activities had a large role to play in awareness generation about the NREGA (IHD 2009). Social audit conducted as a part of “NREGA Watch” of National Institute of Rural Development revealed absence of contractors and machines, kutcha muster rolls, presence of first aid facilities at stone quarries and mines, payment of wages through bank accounts (119,000 labour families had opened accounts in Banks/ Post Offices after NREGA), convergence with health and aaganwadi schemes, better quality of governance and better attendance at gram sabhas (270 out of 284 individuals attended the Gram-Sabha in 2008)