GS-3: Indian Economy and issues relating to Planning, Mobilization of Resources, Growth, Development and Employment, Inclusive Growth and issues arising from it.

Key phrases: MGNREGA, Wage dat

Why in news:

The recent statistics released by Reserve Bank of India shows that a rural worker (men in the non-agricultural segment) in Kerala earned an average of Rs 677.6 daily for 2020-21, taking the top position among the states.

Analysis:

Key highlights of the report:

1. Wage data - non Agri sector:
   • Rural workers in Kerala earn way more than their counterparts in more developed states like Gujarat and Maharashtra and over double the national average.
   • The national average of a rural worker is Rs 315.3.
   • In Maharashtra, considered as the most industrialised state and a leading producer of farm products, a rural worker earns just Rs 262.3. In Gujarat this wage is Rs. 239.3.
   • Uttar Pradesh’s rural workers get Rs 286.8, a rural worker in Bihar gets an average of Rs 289.3 daily.
   • Kerala is followed by Jammu & Kashmir (J&K) where the rural worker got Rs 483 and Tamil Nadu Rs 449.5.
   • Rural daily wages in 15 of 20 states are below the All-India average, indicating that consumption trends across the country could be in line with the movement of daily wages.
   • The wage data is available for 20 states.
2. Daily wage data for rural agricultural segment:

• In Kerala, daily wage in the agri sector is Rs 706.5, followed by J&K at Rs 501.1 and Tamil Nadu Rs 432.2.
• While the all-India average is Rs 309.9, Gujarat’s agri workers get just Rs 213.1 and Maharashtra Rs 267.7 per day for 2020-21.
• In Punjab, it was Rs 357 and Haryana Rs 384.8.
• All-India data for 2020-21 is the average of 11 months as data for April 2020 is not available

    3. Rural daily wage in the construction sector:

• In Kerala, daily wage in construction is Rs 829.7 while the all-India average is Rs 362.2.
• Migrant workers are the main workforce in Kerala. The total number of other state domestic migrants in Kerala was about 31 lakh during 2017-18, according to a study released by the Kerala State Planning Board in March.
• The KSPB report says interstate migrants in Kerala, on average, earn about Rs 16,000 per month, of which they are able to generate about Rs 4,000 on average per month as surplus income or savings.

Constitutional Provisions: Art 39 and Art 43 as part of Directive Principles specifically provide for just, fair and living wages to workers
 

Wage guarantee: Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA)

• MGNREGA was enacted to provide a minimum of 100 days of guaranteed wage employment in a financial year to every rural household whose adult members volunteer to do unskilled manual work.
• Allocations for MGNREGA scheme stood at Rs 73,000 crore in 2021-22.
• The scheme is a demand-driven wage employment scheme, which functions under the Ministry of Rural Development.
• Social inclusion, gender parity, social security and equitable growth are the founding pillars of MGNREGA.
• The objectives of the MGNREGA are livelihood and food security by creating productive assets, reducing rural migration to urban areas, reducing rural poverty and sustainable rural development.
• Gram panchayat plays an important role in monitoring, executing and implementing the scheme.
• Gram Sabha is mandatory for identifying works as per MGNREGA guidelines.
• Regular Social Audit is also an important activity to ensure the transparency and effective implementation of the MGNREGA scheme.
• Also, there is a provision of equal wage for both men and women.
• The Act currently covers all districts except for those that have a 100% urban population.
   

The significant features of MGNREGA are:

1. Guaranteed employment.
2. Kind of right-based employment.
3. Panchayat Raj Institutions are entrusted with the powers of making schemes active in the rural areas.
4. In case creation of employment is not possible the rural people are entitled to get unemployment allowance.
5. Unlike other employment scheme contractors are prohibited to interfere in scheme,
6. Another feature is that worksite facilities are provided.
7. All the payment of wages are made through Banks or Post Offices.
8. Provision of social audit relating to all expenditure is there.
9. The works undertaken with the purpose of conservation of natural resources and asset creation.
10. Sustainable development of an agricultural economy.

Significance:

• The demand for MGNREGA work increases during times of crisis - it reflects the efficacy of this program as a social security net.
• MGNREGA has increased the bargaining power of rural landless labourers and women workers.
• The incidents of caste-based exploration, inter-generational transfer of debt, bonded labour etc. have significantly reduced.
• It has generated more than 31 billion person-days of employment in the last 15 years.
• Since 2006, more than 30 million water conservation-related assets have been created in the country’s rural areas.
• Rural development- at least 60% work must be related to land and water, this boosts rural income.
• The scheme prevents distress migration into cities and thereby reducing stress on urban jobs.
• MGNREGA promotes Women Empowerment in rural areas where women are largely concentrated on farming lands and household activities.
• Awareness generation activities have contributed to a 20 per cent increase in participation of women in the core project areas of MGNREGA.
• Creation of common community services.
• This scheme provided relief to lakhs of migrants during the pandemic and stood as a sign of hope amidst the uncertainty.
• MGNREGA includes 127 million households registered as beneficiaries, and provides wage employment to an average of 70 million households in a year.
• Environmental impact- Afforestation of barren hillocks in highly drought affected areas in Andhra Pradesh has been enlarged to 10,150 hectares by the state government.
• The program reduced poverty overall 32% and prevented 14 million falling below the poverty line.

Related Issues:

• Low wage rate- the MNREGA wage rates of at least 17 of the 21 major states are lower than the minimum wage for agriculture.
• Lack of funds- due to low funds State governments find it difficult to meet the demand under MGNREGA employment.
• Incomplete works- there has been a large delay in completion of works under MGNREGA.
• Ineffective role of Panchayati Raj Institutions.
• Gender wage gap- Women on an average earn 22% lesser than their male counterparts.
• Delays in wage payments.
• Fake job cards and fake identities.

Way forward

• The government should provide greater funds for the proper implementation of the scheme. It currently provides 0.47% of GDP while the World Bank recommends 1.7 % for the optimal functioning of the program.
• Strengthening of such developmental schemes is necessary to improve the lives of vulnerable sections of the rural sector.
• Gender wage gap should be addressed and equal pay for equal work should be implemented as envisaged in Art 39(d) of the Constitution

Source: Indian Express

Prelims question:

Q. Which of the following schemes are related to employment generation and improving employability in India?

1. Prime Minister’s Employment Generation Programme (PMEGP)
2. Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS)
3. Pt. Deen Dayal Upadhyaya Grameen Kaushalya Yojana (DDU-GKY)
4. Deendayal Antyodaya Yojana-National Urban Livelihoods Mission (DAY-NULM)

(a) 1, 2 and 3 only

(b) 2, 3 and 4 only

(c) 1 and 3 only

(d) All 1, 2, 3 and 4

Answer: (d)

Mains question:

Q. The primary characteristic of middle class in both urban and rural areas is that they have permanent, well-paying jobs. To what extent is this true in the Indian context? Elucidate with examples. (10 Marks, 150 Words)