Friday, February 12, 2016

A good U-turn

                                              Mukesh R

Narendra Modi government was in news recently for taking U-turn on its stand on the previous UPA’s flagship programme for rural employment MGNREGA. But thankfully, it was not a bad U-Turn. In one of his speeches in parliament Prime Minister Narendra Modi had said, his political acumen says, he should continue with the MGNREGA.
According to media reports that cited a circular, the proposal was to amend the NREG Act by restricting the area of work and altering the labour-material cost ratio. The plan was to limit the scheme that guarantees 100 days of employment to the rural poor to just 2,500 blocks as against 6,500 blocks. Further the wage-material cost ratio was to be altered in favour of material - from 60:40 to 51:49. What this means is that until now 60 percent of the expenditure was spent as wages and 40 percent as cost of material.
As per the proposal, the spending on wages would drop to almost the same as that spent on material, which would mean a reduction in the funds set aside for wages. Moreover, there were also plans to curtail the central government's fund disbursal to states, with Karnataka Chief Minister Siddaramaiah even seeing the allocation to the state being halved.
These were the proposals made by former Rural Development Minister Nitin Gadkari. Now new minister Birender Singh has told Rajya Sabha that there will not be any change in the scheme.
"There is no ambiguity about the government's intention. The scheme will continue in all the 6,500 blocks," Singh said, allaying all apprehensions that the new government may be killing the scheme.
According to a PTI report, he also said all necessary funds have been released and assured the 60:40 ratio on labour and material would not be altered.
What prompted this U-turn from the proposed amendments is a hue and cry raised by a section of economists, rights activists and other political parties. According to a Firstpost report, the economists, including Jayati Ghosh of JNU and Anirban Kar of Delhi School of Economics, had shot off a letter to Prime Minister Narendra Modi urging him not to make changes to the scheme that provides livelihood for about 50 million households.
Whatever the reason, the change in stance is welcome because going ahead with the decision to alter the scheme would have been a flawed one given the signs of weakness in India's rural economy.

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