Combating poverty

Employment Guarantee Programme and Pro-Poor Growth: The Study of a Village in Gujarat
By Indira Hirway, M. R. Saluja and Bhupesh Yadav.
Academic Foundation. Pages 221. Rs 795.

Reviewed by D. S. Cheema

THIS book is part of a study commissioned by the Levy Economics Institute of Bard College, New York (USA), with the aim of understanding the impact of employment guarantee programmes in village economy in India. The authors have studied the problem of a village in one of the most backward districts of India, selected for implementing government’s National Rural Employment Guarantee Act (NREGA) scheme in its first year from February 2006. The first two chapters are devoted to academic discussions and analysis of "employment guarantee" and "the employment challenge and NREGA in India", the next five chapters contain the actual study carried out in Nana Kotda village of Gujrat, and the last chapter is in the form of summary, suggestions and recommendations.

Ensuring employment to all those who are willing to work is a major challenge in all poor and developing countries. Along with recent acceleration of GDP, the declining rate of growth of employment, deterioration in the quality of employment and negligible increase in the real wages because of high rate of inflation remain major concerns in the field of employment in our context.

It has been observed that the rate of growth of employment in developing countries is much lower than the rate of growth of the labour force and as such the total number of unemployed keeps increasing. Many experts believe that the situation is deteriorating under the policies of neo-liberalisation and globalisation, as both result in increasingly capital-intensive technologies and declining labour intensity. Creating employment opportunities for the poor is a goal which is also in line with the UN Declaration of Human Rights and International Labour Organisation declarations. Whenever a developing country opens up its doors to the developed world, it gets the benefit of jump in technology which further results in higher labour productivity and this leads to higher rate of growth of economy. Unfortunately, it also results in the lower rate of growth of employment. Unless there is some in-built mechanism in such a system to ensure generation of adequate employment at higher productivity, unemployment will keep increasing. And that is what is happening in all developing economies, including India. When developing nations open their economies, they often land up in a situation where they have to import goods and services from abroad as the developed countries produce cheaper goods and provide cheaper services with their superior technologies. This results in lesser production at home and hence lesser job opportunities.

In 2006, India started NREGA as a very ambitious programme for poverty eradication in all its 6oo districts. The government adopted the approach of promotion of labour-intensive sectors, like infrastructure development and maintenance, to address the problem of slow growth of employment. Experience favours a shift from right to income approach, i.e., cash transfer to destitute, incapacitated and those unable to work, to right to work approach, i.e., providing them with guarantee of employment, as the poor need work to lead a life of dignity and not just for cash.

The objective of the government is that employment guarantee should, in due course of time, lead to full employment. This can be done by strengthening those sectors in which the poor are predominant by construction of socioeconomic infrastructure for promoting employment intensive development and by addressing unpaid work of women for promoting women’s work in the labour market. It must be clearly understood that any employment guarantee scheme has to have a long-term perspective and system approach to link any such scheme with macroeconomic growth process of the country.

An important point to ponder over is that why such a noble cause for helping the poor has not made much impact at the macro level. The scheme is perceived to have stagnated at the ground level and as such cannot be rated as highly successful. One of the reasons which government has readily pin-pointed and accepted is that it was not right to extend the programme to all 600 districts of the country rather than focusing on only 200 odd poorest districts. All employment guarantee programmes essentially aim at reducing poverty at the bottom level where it hurts the most. Any such scheme should provide employment at reasonable wages and also create productive assets which are essential aspects of nation building.

In the last chapter, the authors have made some suggestions for modifying the design of rural employment guarantee schemes. They have also provided some useful recommendations to make the scheme more successful. This book can be useful to social scientists, government departments engaged in NREGA implementation and students of sociology and political science.