Rural job scheme raises agri costs in AP

Is the Rural Employment Guarantee Scheme (REGS), the flagship programme of the UPA government launched under the National Rural Employment Guarantee Act-2005, coming in conflict with agriculture in Andhra Pradesh?

While the labour shortage was cited as a problem in agricultural operations prior to the introduction of REGS in many areas closer to towns and cities, labour as a key input is now adding to the cost of agriculture following the introduction of REGS, according to a feedback received by the state agriculture department during its recent farmers' awareness campaign.

The gap in average wages earned by daily labourers under the REGS and in agriculture under rainfed conditions is very large leading to higher labour costs in farm operations as the bargaining capacity of farm labourers has gone up steeply in the light of the scheme.

"It is good to see that the bargaining capacity of agriculture labourer has increased. But it is a cause for concern as the cost of agricultural operations is going up on account of several factors, including the increase in labour costs," Poonam Malakondaiah, commissioner, agriculture, Andhra Pradesh government, told Business Standard.

She, however, said that the department's endeavour was to reduce the cost of agriculture through various other initiatives so that farmers did not face distress in situations where the expenditure and the income did not match.

Andhra Pradesh is the first state to implement REGS in the entire country. The scheme has been introduced this year in 13 drought-prone districts. The rural development department has issued job cards to 40.34 lakh households having a total number of 92.45 lakh job-seekers. Of them, only 4.13 lakh wage-seekers have been employed so far.

Under the scheme, nearly 1.5 lakh small works at an estimated cost of Rs 1,084 crore had been identified and Rs 34.45 crore paid towards wages as on June 2006, according to the data provided by the commissionerate of rural development.

The department, in collaboration with Tata Consultancy Services, has developed a web-based software programme that monitors the implementation of the scheme at the minutest level on real-time basis.

The scheme has brought about two changes in the present wage pattern in rural areas.

The average wage paid under the REGS is Rs 91.34, which is much higher compared with the average wage earned from agricultural operations. The scheme also offers equal wages to both men and women, which is not the case in agricultural operations.

According to the data compiled by the directorate of economics and statistics, the average wage earned by male agriculture labourers in 2005 was Rs 57.99, while women got Rs 41.38.

The highest average wage rate of over Rs 70 for men and over Rs 50 for women is offered to agriculture labourers only in Nizamabad and West Godavari districts.

The farmers are now under pressure to increase wages to retain the required labour during cultivation and other farm operations in areas where the REGS is under implementation, according to the feedback of agriculture department which contacted about 24 lakh farmers through awareness camps conducted in villages prior to the onset of Kharif season. While the impact of the REGS on rural wages is expected to become more visible once the scheme is implemented in full, work in other sectors like irrigation projects and canal works are also offering substantial alternative employment in rural areas thereby increasing the pressure on agriculture, say observers.

It is a case of direct conflict of interests where the works under the REGS are being executed during the time of peak agricultural operations. But the rural development department maintains that the works are usually undertaken when there are no agricultural operations.

Tulasi Das, a CPI(M) leader involved in agriculture labour movement, however, says the talk of increased labour costs and labour shortage is only an exaggeration and far from the reality.

"The same woman works for Rs 40-50 a day during the time of sowing and for Rs 20-30 a day during weeding operations and up to Rs 70 during the time of harvesting. So the higher wages offered under the REGS will not act as a deterrent for agriculture labourers to work at low wages.

Moreover, REGS work is normally executed during the time when agricultural operations do not take place. Even if the REGS works are continued during the time of agricultural operations, they are very minimal compared with the size of rural labour force," he said.