EMPLOYMENT GUARANTEE BILL

  Mirage Of A Guarantee

W R Varada Rajan

THE National Common Minimum Programme (CMP) had, inter-alia, committed as under: “The UPA government will immediately enact a National Employment Guarantee Act. This will provide a legal guarantee for at least 100 days of employment, to begin with, on asset-creating public works programme every year at minimum wages for at least one able-bodied person in every rural, urban poor and lower middle class household. In the interim a massive food-for-work programme will be started.”

This is the singular commitment that roused huge expectations among the youth in the country, who were feeling frustrated at the ‘jobless growth’ paradigm of economic development adopted since the economic-reforms years. This was followed up by a similar promise held out in the first budget of the UPA government presented by the finance minister, P Chidambaram. But, instead of giving a start to a ‘massive food-for-work programme’, envisaged as an interim measure in the NCMP, it merely pooled all the existing rural employment schemes under different headings for implementation, without any additional financial allocations.

The National Advisory Committee (NAC) headed by Sonia Gandhi, chairperson of the UPA, engaged itself in preparation of draft legislation to fulfill the commitment on employment guarantee. The draft was put up on the website of the government of India during August 2004.

This draft itself narrowed down the scope of the proposed legislation by confining itself only to ‘providing employment in rural areas’ only, leaving out the urban households.

During the concluding phase of the winter session of the parliament, the government of India had completed the formality of introducing ‘The National Rural Employment Guarantee Bill, 2004’ on December 21, 2004. This much watered-down bill satisfied nothing of the commitment made in the CMP, to say the least. Jean Dreze, who was associated with the drafting of the legislation as a member of the NAC, could not conceal his disappointment and curtly commented: “Unfortunately, the Bill is so watered down that it defeats the purpose of an Employment Guarantee Act.” He also termed the Bill as a ‘travesty of the NAC draft.’

The bill, even going by its nomenclature, totally excludes urban areas and households. It cannot be the case of the government that unemployment problem is a phenomenon confined only to rural India. The unemployed youth overcrowding the labour market in urban areas seeking desperately for jobs for their survival and livelihood, in fact, comprises a large segment of those who had been forced to migrate from rural areas due to penury and dearth of agriculture related jobs. Leaving this section of urban unemployed out of the purview of employment guarantee legislation, for the entire tenure of the UPA regime itself, is nothing but subversion of the mandate of general elections 2004. In that sense, the bill excludes a sizable section of rural poor too.

Even for the rural areas, there is no definite time frame for extending coverage of the legislation to the whole country. The statement of objects and reasons appended to the bill only states: ‘it has to be implemented in phases so as to eventually cover all the rural areas of the country, subject to the economic capacity of the central and state governments.’ The bill only provides: ‘it shall come into force on such dates as the central government, by notification in the Official Gazette, appoints; and different dates may be appointed for different states or different areas in a state.’

Which area of the country is to be covered by the legislation and at what time is left to the discretion of the executive and thus the legislation loses its teeth to make the scheme enforceable universally. It may well remain just on paper for greater sections of the poor in the country.

The financial memorandum accompanying the bill estimates that “if the legislation is extended to 150 districts, where the National Food for Work Programme is being implemented, the requirement of central funds will be approximately Rs 8,984.70 crore.” or the rest, the employment guarantee may remain only on paper, as it has been estimated that if the whole country is covered under the legislation, the total requirement of funds (central share) would be of the order of Rs 34,780 crore. The usage of the language ‘to safeguard the right to work’ in the NAC draft has deliberately been avoided in the bill. The preamble of the bill only talks of ‘enhancement of livelihood security’.

The bill prescribes an eligibility criterion of ‘poor households in the rural areas’, which is also a deviation from even the NAC draft. It defines poor households as those below poverty line in the relevant financial year. As we have witnessed in the case of public distribution system (PDS), this eligibility criterion and definition would only result in exclusion of large sections of even the impoverished rural households from the purview of the legislation.

This bill is supposed to be meant for enacting a central legislation – in line with the commitment made in the NCMP – which is a policy document adopted by the UPA government at the centre. It is, therefore, natural to expect the government at the centre to fully fund the implementation of the scheme.

But, the provisions in the bill are worded in such a way as to make the financial responsibility flowing from it to be a concurrent liability of the centre and the states. Nay, the bill is so designed as to devolve more financial obligations on the states rather than on the centre. The bill imposes several obligations on the state governments, including bearing 25 per cent of the material component of the wages, unemployment allowance, and a whole lot of benefit package of welfare benefits, et al. In the context of the current financial condition of most state governments, none can be expected to provide funds from its own resources, which are meager and scarce, to implement this legislation. Ultimately, this legislation could become a subject of a heated centre-state controversy and a matter of ‘passing the blame ball game’.

This type of scheme for employment guarantee throughout the country must have a dedicated fund with dedicated fiscal arrangement for generation of funds through various means like taxing the rich, the big business and the landlords; cess on corporate tax or turnover etc. The bill is completely silent on this crucial aspect, which raises doubt about the real intention behind the exercise.

Another significant dilution in the bill is in relation to the wages payable under the legislation. The CMP mentioned 100 days of employment ‘at minimum wages’. But, the bill only provides: “Notwithstanding anything contained in the Minimum Wages Act, 1948, the central government may, by notification, specify the wage rate for the purpose of this Act: Provided that different rates of wages may be specified for different areas.” There is conspicuous failure to even specify that the wage rate should not be below the national floor level minimum wage. But, the bill makes a mention of statutory minimum wage for the agricultural workers, despite the fact that in many states there is no provision of statutory minimum wage for agricultural/rural workers. There is no enforceable commitment to ensure payment of statutory minimum wages prevalent in respective states.

Another significant failure of the bill is in addressing the gender-sensitive issue of extending the benefit of employment guarantee to women by making specific provisions under the legislation. A clever attempt to circumvent the obligations arising from this legislation is the incorporation of the ‘minimum features’ of the employment guarantee scheme and ‘conditions’ and ‘minimum entitlement of labourers’ under the scheme in two separate schedules appended to the Act. The omission to incorporate these as a part of the Act itself is deliberate as the schedules could be modified at will by the central government, to the detriment of the beneficiaries, without having to seek the approval of the parliament.

Thus, the National Employment Guarantee Bill , in its present form,  is highly inadequate and belies the expectations of the people.  It goes back from the promise made in the CMP. The trade union movement and other mass organisations will have to mount severe pressure through organised action programmes on the ground to force the UPA government to make the intended legislation a meaningful one, conforming, without dilutions, to the solemn commitment made in the CMP.