Jairam Ramesh proposes making rural job scheme less labour-intensive

Revised MGNREGS guidelines to be finalised end of this week

By Moyna
Published: Tuesday 15 November 2011

The revised guidelines for the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) is likely shift the social welfare programme's thrust from being labour-intensive to material intensive. This was indicated by the Union minister for rural development, Jairam Ramesh, on November 14 at a day-long seminar on the UPA government's flagship programme. 

At the consultations titled, Empowering Lives through MGREGA: Strengthening the Reform Agenda, held in collaboration with the United Nations Development Programme (UNDP), Ramesh said the ratio of labour and material stipulated under the MGNREGS needs “serious reconsideration”. The minister announced that the new guidelines for the scheme would be finalised before the end of this week.


Indicating that the scheme needs to be simplified, the minister in his opening and closing remarks, suggested many changes. These include reverting to cash payments, especially in Naxalite-affected areas, a review of the 100-work-days stipulation and increasing the six per cent cap on administrative costs. He said, “It's time to take some tough decisions, though, they will not be liked by all.”

As per the existing guidelines of the scheme, any work to be sanctioned needs to spend 60 per cent funds on labour and 40 per cent on material. This clause was included in order to ensure that the scheme remains labour-intensive in order to be true to its name—rural employment guarantee scheme. But Ramesh said the “60:40 ratio of labour and material, has run its course and needs to be revised.” Experts expressed concern over the impact this could have on the scheme.

'Change in man-material ratio will defeat scheme'

Grass-root workers like Balram from Jharkhand's NREGS Watch feel the change in labour- material ratio is a dangerous step. “Based on field experience, I feel such a step will lead to further corruption.” He explains that increasing the material expenditure component of any work assigned under the scheme will lead to further power to the contractors who could completely side-step the labour, thus defeating the whole premise of the scheme. “A couple of months ago, numerous scams were unearthed in Jharkhand, all pertaining to contractors and use of material and this change will lead to further siphoning of funds,” he says.

Harsh Mander, member of the Sonia Gandhi-led National Advisory Council, says the primary focus of the scheme—guaranteed employment—should not change. He explains that if the ratio is changed then this focus could be lost. He adds that such a change might be difficult and would require other changes in the employment guarantee Act, in which all works listed under the scheme are labour-intensive.

In addition to the proposed changes, the rural development minister emphasised the need to create durable assets and said construction ought to be discouraged while more importance needs to be given to land development and water management. This and other innovations use of technology were discussed at the seminar.

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