People's Democracy

Convention On Employment Guarantee Act

THE new UPA government at the centre has prepared a draft Employment Guarantee Bill that is expected to be tabled in parliament next month. Against this background, SAHMAT organised a convention to reaffirm the centrality of an Employment Guarantee Act, and to outline the framework of an effective Act, which promotes the interests of workingmen and women and ensures that state governments can implement the Act without an additional financial burden.

The political leaders, activists and academics who spoke included Jairam Ramesh (Congress), Sitaram Yechury (CPI-M), D Raja (CPI), Saba Faruqui, Suneet Chopra, Prabhat Patnaik, Aruna Roy, Jean Dreze, Medha Patkar, Arundhati Roy, Sukhdev Thorat, Dunu Roy and Jayati Ghosh. Brinda Karat chaired the meeting.

Speakers agreed that aside from protecting the rural population from hunger and destitution, an Employment Guarantee Act would also contribute to many other social objectives, including the creation of durable assets, the protection of the environment, the empowerment of women, and the slowdown of rural-urban migration. In addition, of course, there would be strong multiplier effects of such employment, which would therefore have a positive effect upon rural livelihoods. This impact would be much larger than the actual expenditure.

Setting the ball rolling, Aruna Roy underlined the political significance of the EGA in the current regime of neo-liberal economic policies that have resulted in falling employment growth. The introduction of such an Act in the current climate is therefore an important avenue for mass mobilisation and resistance against neo-liberal policies. The Act is a recognition that the State cannot retreat from pro-poor development and is responsible to ensure livelihood security and employment. Medha Patkar too emphasised the conflict between different policies, which becomes stark when the EGA is discussed. She spoke of the loss of control over common property and natural resources for wide sections of the population as an outcome of globalisation, and said that decentralised planning, and land and water management by the people are the prerequisites for an effective EGA.

Most speakers contested the view expressed by Jairam Ramesh, that there was no contradiction between the policies of liberalisation, privatisation and globalisation (LPG) on the one hand and the guarantee of employment on the other. He in fact argued that the real conflict was between the interests of the unorganised rural workers and the small section of organised government employees. He said that the Sixth Pay Commission would erode the very possibility of an EGA since the government had a financial constraint. In this way, he posed a choice between government employment and universal employment guarantee.

Sitaram Yechury argued that the EGA was non-negotiable and the attempt to pose the argument in terms of organised versus unorganised was a red herring. He gave a call to tax the rich, which was the best route to pursue a pro-poor and growth-oriented development policy. A failure to do this would erode the legitimacy of the UPA government to remain in power because it would undermine the mandate. He gave a call to simultaneously extend the universal guarantee to urban areas. D Raja too wanted the UPA government to recognise the gravity of the situation on the ground, based on which the Left Parties had originally asked for a universal guarantee of at least 180 days to be included in the CMP. He said the issue was not one of finances or requirement but of the political will to take the EGA forward, so that it does not remain a mere formality and becomes an effective livelihood guarantee. He said that CPI would fight for this both within and outside Parliament. Dunu Roy fully supported that the EGA must cover urban areas since the crisis of livelihoods is large here too.

PLAYING UPON INSECURITIES

Jayati Ghosh refuted claims that this Act was unaffordable. The different estimates range between 0.7 and 1.4 per cent of GDP. The mainstream media and those sections who directly benefited from the policies of neo-liberalism are playing upon the insecurities of the middle class by stating that a universal rural employment guarantee will pose an inordinate tax burden on the middle classes, already burdened by high consumer price inflation. She argued that the “gift” of Rs 5,000 crore to a handful of traders at the stock exchange as a result of the dilution of the turnover tax was a simple measure for raising revenue which should be reinforced. Removal of the capital gains tax was justified on the basis of the higher turnover tax, but even after retracting on the turnover tax front, the capital gains tax has not been reintroduced.  She argued that if the tax-GDP ratio was restored to the 1991 level, there was enough money not only for a universal urban and rural employment guarantee but also enough left over for mid-day meal schemes, free universal primary education, etc. She said that the Fiscal Responsibility and Budget Management Bill was a dangerous Act that ties the hands of the government. She argued that there was no harm in printing money to finance development schemes, since they were not inflationary if wage goods were available in the system.

NAC member Jean Dreze said that the Act was mired in myths and misunderstandings. Stating that it was not a ‘crackpot’ Act, he said that though legislation alone would not help guarantee employment and continuous mobilisation was required, the Act had great scope to reduce rural poverty by 70 per cent. He warned against settling for a scheme as proposed by some quarters, since this would have far too many loopholes.

DEFINING WORK

Brinda Karat raised the important issue of defining work and household. She said this was an important step in the right direction, but it did not and could not solve everything. She argued that ‘manual’ work often meant that women would be excluded from it, which was dangerous in the context of abysmally low levels of poorly paid employment of women in rural areas surveyed by AIDWA. Furthermore, there should be individual entitlements, because otherwise women would be excluded. In any case, she argued that the definition of a household was fraught with difficulties since the absence of homesteads meant that a number of families shared the same roof and kitchen. She gave a call for a national day of action for the EGA on December 10, which is also the Human Rights Day.

Saba Faruqui said that every possible care should be taken to ensure that female-headed households are given primacy and women are not excluded from the scheme.

Prabhat Patnaik concluded the convention by warning against the forces that militate in different ways against the provision of an effective EGA. He said that finance capital stood in direct conflict with any such policy that was non-deflationary and had the potential of reviving the rural economy and increasing public expenditure. This, he said, could happen in three different ways: one was, by openly thwarting the exercise in the name of inadequate funds, etc. The second was by manipulations and machinations that put one group against another by creating false vested interests like organised versus unorganised workers, tax payers versus the rural poor, etc. The third was by the Bretton Woods institutions like the World Bank appropriating the scheme by offering to fund it against all kinds of conditionalities. He called for resisting such attempts.