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Why NREGS is not a solution

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  • It took me two hours to drive from Mumbai’s international airport into the city last week. Not because it was rush hour or because some festival disrupted traffic but because this is how it is in the city we like to think of as our Shanghai, our New York. How deluded can we get! The drive was tedious but gave me time to reflect on the slums I drove past in slow motion. I saw small, half-naked children playing on the edge of open sewers while their mothers washed clothes in filthy water and I gawped with Davos-returned eyes at the windowless hovels in which half the citizens of our commercial capital live.

    Just as I was beginning to collapse into terminal depression at the everyday realities of Bharat Mata my cellphone signalled a message. It said, ‘The land of picturesque destinations welcomes you to Maharashtra. Select IDEA/INA 22/40422 manually to enjoy quality roaming.’ It came as a reminder that India now has the most modern technologies in the world but neither the governance nor the political vision to use them to win our biggest battle: the war against poverty.

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    In Davos I attended sessions on urbanisation, poverty, healthcare and water and heard experts talk about the solutions that could be brought through using modern technology. There are some solutions that do not even need technology. I heard the rock star, Bono, talk of the dramatic changes that mosquito nets had brought in the lives of African children and Bill Gates talk of the gains achieved through what he calls ‘creative capitalism’.

    His foundation has done more to battle poverty and disease in a decade than most of our state governments have done in 60 years. For a moment in the rarefied air of Davos I thought how easy it would be to solve India’s problems if we looked for the right solutions. But the two-hour drive into Mumbai city reminded me of the enormity of our problems and how far we are from finding the right solutions.

    On the drive I occupied myself by glancing through the newspapers of the past few days and found myself riveted by an article that defended Sonia Gandhi’s favourite economic idea, the National Rural Employment Guarantee Scheme. Some of the jholawala economists who devised the scheme in the first place took it upon themselves to defend it against the Comptroller & Auditor General’s criticism that it is not achieving its purpose.

    This newspaper recently carried extracts of the CAG report that showed that less than three per cent of registered beneficiaries got the promised hundred days of employment a year. The jholawala economists accept that much needs to be done to make the scheme more effective but want the scheme extended to every district in India by the middle of this year. This will surely happen since the scheme has the blessings of Sonia and Rahul Gandhi but if it is, can someone up there please alter it to include skills training? It would make all the difference.

    In Davos I interviewed Sunil Mittal for a special series of television programmes I am doing on economic reform and he said that the most important reform that we could make now was to train semi-literate Indians in skills. Not just India but the whole world is desperately short of masons, carpenters, electricians, plumbers and other workers of similar kind. If we use the employment guarantee scheme to teach these skills as part of its mission we create a work force that would find employment 365 days a year. The beneficiaries will lift themselves out of poverty and no longer need the sort of charity that the employment guarantee scheme provides.

    Not even the Marxist parties could object to an altered and expanded version of the employment guarantee scheme since there are no ideological problems involved. They have stalled privatisation and reforms in insurance and labour policies on the grounds that they are ‘anti-people’ but there can be nothing anti-people about giving semi-literate, desperately poor people training in a skill during their 100 days of employment.

    For my TV series I interviewed some of our most intelligent and important business leaders and asked each of them what they think are the three economic reforms that still need to be done. Nearly everyone mentioned education as one of the three. And, nearly everyone agreed that some form of technical education, even just the teaching of a basic skill, was vital. The problem we face is not unemployment, they said, but ‘employability’. In its present form the employment guarantee scheme is a form of charity that serves to keep very poor people very poor forever. This is not a solution and what we need are solutions.

    BULLBy: yash | 01-Dec-2008 Reply | Forward This article is mostly bullshit. The government is generally inefficient in most things it does, and despite that, the NREGS has had a phenomenal impact. It has significantly addressed the distress that was leading to massive migration. Now one is seeing a return to villages. It's difficult to find workers in cities! Of course it can be improved, but NREGS is a very important scheme which provides social security that is somewhat similar to the unemployment allowance given in several developed countries.
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