Relevance: GS-2 : Welfare schemes for vulnerable sections of the population by the Centre and States and the performance of these schemes; mechanisms, laws, institutions and bodies constituted for the protection and betterment of these vulnerable sections.

Key Phrases: Urban Employment Guarantee (UEGs) schemes, MGNREGA, SJSRY ,NULM,

Why in News ?

• Recently, the Rajasthan government announced the start of the Indira Gandhi Shahri Rozgar Guarantee Yojana while presenting the Budget for the next financial year.
• This is essentially an employment guarantee scheme on the lines of the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) albeit for the urban areas.

Key Highlights

• With each passing year, more and more Indian state governments are looking favourably towards an urban version of MGNREGA.
• The success of the NREGS program during the COVID-19 pandemic as an effective safety employment mechanism utilized by thousands of rural poor households during the lockdown.
• It led some state governments like Himachal Pradesh, Jharkhand and Odisha to start the urban employment schemes last year in their respective states.
• Tamil Nadu has also recently announced a plan for such a program in their state.
• In addition, it has widely been reported that the Ayyankali urban employment scheme of the Government of Kerala proved immensely helpful to families whose economic hardships were exacerbated by the fallout of the pandemic.

Reasons for UEGs Demand

• Previous Schemes
  • India has had a history of urban employment schemes such as the Swarna Jayanti Shahari Rozgar Yojana (SJSRY), which was launched in 1997.
    • It provided employment to the unemployed and underemployed urban poor through self-employment and wage employment.
  • In 2013, the SJSRY was replaced by the National Urban Livelihoods Mission (NULM).
  • But none of them were employment “guarantee” schemes.
• Requirement of UEGs
  • The need for a scheme providing a guarantee is due to the growing distress among the urban poor, which has remained largely unaddressed for a long time — Covid just made it worse.
  • Most unemployment data:
    • Be it from the Center for Monitoring Indian Economy or the government’s own Periodic Labor Force Survey — shows that the unemployment rates are typically higher in urban areas.
    • Add to that the fact that, as this analysis from Crisil revealed, the urban poor are worst affected by India’s persistently high inflation.
  • Structural Issues
    • Indian towns and cities continue to be plagued by the prevalence of low-wage, poor quality, informal work.
    • PLFS data show that despite a rise in the prevalence of regular-salaried work, just over 50 per cent of the urban workforce remains either self-employed or in casual wage work.
  • Major Focus on Rural Sector
    • Making matters worse is the fact that most of the government schemes providing relief — be it from the Union government or state — prioritize rural unemployment and poverty.
    • A good example is the existence of MGNREGA.
    • Another example is the Prime Minister Garib Kalyan Rojgar Abhiyaan.
• This was launched on June 20, 2020, with an allocation of Rs 50,000 crore.
• Its main objective was to boost employment and livelihood opportunities for migrant workers returning to villages in the wake of the Covid outbreak.
  • Nikhil Dey, one of the main architects of the MGNREGA, says that the National Common Minimum Programme of the UPA govt had talked about both rural and urban employment but as it happened only the rural employment guarantee scheme went through.
  • He believes, like many others, that is time for India to have a national urban employment guarantee (UEG) scheme.

Design UEGs

• Most UEGs appear to be a mere extension of MGNREGA to the urban areas.

• Kerala (Ayyankali Urban Employment Guarantee Scheme (AUEGS)
  • It aims at enhancing the livelihood security of people in urban areas by guaranteeing hundred days of wage-employment in a financial year to a urban household
• But in reality, a UEG cannot be a mere extension of MGNREGA because of following reasons:
  • Rural unemployment is mostly seasonal.
    • During peak farming season, very few rural people may be unemployed.
    • However, during other months, unemployment in rural areas goes up.
    • But there is no such seasonality in urban unemployment.
  • Similarly, the public works in which the labour is involved are quite different from each other.
  • Another key difference is the capacity of the Panchayati Raj Institutions in rural and urban areas.
    • Urban local bodies are poorly funded and have little capacity to provide help.
• So the more fundamental problems in conceptualizing a UEG are these
  • Is it, like MGNREGA, which is aimed at preventing distress migration?
  • If not, then what is it primarily trying to do?
  • Secondly, should the government create these guaranteed jobs or should the government simply give out wage coupons whereby the jobs would be given by a private firm but the coupon holder’s wage comes from the government?
• Most of the UEGs mentioned above follow the model where the government has to create the jobs that it is guaranteeing.
• But Jean Dreze, another person who drafted the MGNREGA, has been writing about a Decentralized Urban Employment and Training or DUET.

Funding of National Level UEG

• Most of the state-level UEGs are backed by very modest Budget allocations.
• But a national-level UEG would demand a substantial Budget allocation.
• According to one calculation by researchers at APU published in The Indian Forum, “a UEG programme that covers an estimated 20 million urban casual workers for 100 days, with a wage rate of Rs 300 per day, would cost the union government around Rs 1 lakh crore”.
• The actual Budget outgo would depend on how many people are covered and what is the guaranteed wage.

Should there be a national UEG?

• Arguments Against UEG
  • Be it MGNREGA or UEG, these are essentially relief measures.
  • While such programmes and schemes start as relief measures, they tend to be quite sticky.
    • It is unlikely that once instituted such a programme will be withdrawn by any future government.
  • Another concern is about funding.
    • It often helps provide a different perspective when one adds up all the money spent on MGNREGA over the past 10 or 15 years. Could that amount of money be spent better?
  • Similarly, it is reasonable to ask that if India had an additional Rs 1 lakh crore to spend, why should the policymakers spend it on a new UEG scheme and not simply boost the Budget allocation for MGNREGA.
  • Boosting MGNREGA would, on paper, reduce distress migration and ensure that only when cities create well-paying jobs do people in rural India feel enthused to migrate out.
• Argument in favour
  • Urban employment schemes are also critical to achieving SDG Goal 11 of making cities inclusive, safe, resilient and sustainable.
  • The labour under the scheme can build and develop urban commons like parks, water bodies, forests, and public services like public housing, schools, and hospitals, providing work to those who need it and making these services affordable and accessible through appropriate policy framework and departmental convergence.
  • Learnings from MNREGA suggest that it has immensely helped women at times of distress by putting some money in their hands and building confidence.
  • Many suggest that care work, both childcare and elderly care, should be included in the list of sanctioned works that can provide incomes and decent livelihoods to scores of women who do this without pay.
  • When the economy is just beginning to rise after the slump caused by the pandemic, infusing this investment will help bring cash in the hands of the urban poor.
  • It will contribute significantly to raising consumer demand and give the required boost to economic activities.

Way Forward

• The design of the urban job guarantee scheme should therefore cater to the unpredictable nature of patterns of urban unemployment.
• It should define who will be eligible and spell out the types of work included in the scheme, indicate where the financing will come from,
• It should show how local government institutions will implement and monitor the scheme.
• The states that have taken the lead in implementing urban employment schemes can provide valuable experience.
• So their achievements and shortcomings need to be thoroughly analyzed to create a good program with a robust administrative mechanism for implementation at the national level.

Conclusion

• It is high time that serious efforts are made to develop and bring out the Act that will help provide a guarantee of work and social security to the urban poor in the current uncertain times cast by the pandemic.
• The National Employment Policy, which the Union Government is currently working on, should include a National Urban Employment Guarantee Program to ensure a dignified livelihood for the urban poor.

Source: Indian Express, Action Aid India

Mains Question:

Q. Why is there a growing demand for urban employment guarantee schemes? Should India have one at the national level? Critically Examine.