NREGP proves cheap for govt

Budget allocations for rural employment schemes have steadily decreased ever since the government introduced the National Rural Employment Guarantee Programme (NREGP), one of the government's flagship programmes to benefit the common man, in 2006-07.

The declining trend of allocations for wage employment has been highlighted in data compiled by by N C Saxena, a member of the National Advisory Council, which advises the government on developmental issues, in a critique of social spending in the Budget.

In 2005-06 "" that is, before NREGP was introduced "" each worker was being given 5 kg of food-grain per day as part of wages.

The revised estimate for wage employment work under the ministry of rural development was Rs 10,200 crore excluding the Rs 1,500 crore meant to cover the cost of food component, said Saxena. 
 

ON THE JOB (Wage employment gets smaller)
2005-06	18,406
2006-07	16,117
2007-08	15,000
2008-09	16,000
Compiled from government data Figures in Rs crore

In that year, however, the total outlay "" that is, the cost of grain plus wages "" finally worked out to Rs 18,406 crore. Of this, food-grain worth Rs 8,206 crore was taken for payment under the Sampoorna Grameen Rojgar Yojna (SGRY) and National Food for Work Programme.

The data have been drawn from ministry of consumer affairs, food and public distribution figures for food-grain off-take from the central pool for wage employment schemes.

There was no food-grain component under NREGP in 2006-07. In 2006-07 food-grain released for other wage employment schemes was only 2 million tonnes against 6 million tonnes in the previous year. This has dropped to 0.7 million tonnes in the current finance year (up to November 2007) and the 2008-09 Budget has no trace of it.

"Removing the food component has been unfair to the poorest of the poor," said Saxena.

Converting these figures into cash would imply that total government expenditure on wage employment schemes has dropped from Rs 18,406 crore in 2005-06 to Rs 16,117 crore in 2006-07, and close to Rs 15,000 crore in the current year, he said.

The allocation of Rs 16,000 crore for 2008-09 even at current prices does not match what was spent on wage employment schemes in 2005-06. If inflation is factored in, the allocation for 2008-09 is less than what the government spent in 2005-06.

In other words, the introduction of NREGP has actually reduced the government's financial liability to support wage employment.

"No wonder the legal guarantee of 100 days wages according to the Comptroller and Auditor General has been fulfilled in only 3 per cent cases," said Saxena referring to a critical note by the CAG late last year.