EGA sabotaged?

The National Advisory Council appointed by the UPA government had some weeks ago sent to the Prime Minister's Office a draft version of a Rural Employment Guarantee Act. Since then, there has been considerable speculation that its guarantees of employment for a substantial number of the nation's poor would be altered before the legislation is introduced in the winter session of Parliament. Some members of the administration wondered whether the cost of such a widespread guarantee would be affordable.

Anticipating this concern, the NAC had prepared - along with its draft - a note demonstrating that the cost of the employment guarantees may be as low as 1% of the GDP. Despite this, it is now reliably learnt that the 'revised' draft of the National Rural Employment Act to be tabled in Parliament in December has radically diluted some key provisions of the initial draft.

The most important change from the original draft concerns the time-bound extension of employment guarantee to the whole of India within five years, beginning with the poorest districts first. This key provision has now been replaced with the following clause: "[The Act] shall come into force immediately in such areas and for such periods as may be notified and shall be extended to cover all the rural areas of India after evaluating the implementation in the Districts chosen."

This alteration would limit the guarantee to a few districts chosen by the government. Not only would this greatly reduce the number of people benefiting from the legislation, it would additionally - and maybe unconstitutioonally - offer benefits to some poor people and deny them to others in a similar condition. Further, this would allow the government to postpone further extension of the guarantees to all rural areas indefinitely. Even worse, it is feared that the government may allow the Act to fail in the districts initially chosen, and treat such failure as a reason to avoid the financial burden involved in further extension.

A second proposed change to the revised version would run afoul of wage legislation. The revision allows the government to fix wages for employment under the guarantee scheme as low as it wishes, disregarding existing legislation on legal minimum wages. The proposed revision reads:

"Notwithstanding anything contained in the Minimum Wages Act 1948, the Central Government may fix the rate at which wages shall be paid to the labourers employed under the Programme; different rates may be notified for different areas; until the Central Government notifies wage rates, the beneficiaries shall be paid the statutory minimum wages fixed by the respective State Governments for the agricultural labourers."

Taken together, these critical revisions to the original draft - postponing full coverage to all areas, and ignoring minimum wage legislation - would amount to a significant dilution of the Act, a move certain to be interpreted by advocacy groups as a rollback of the government's promise in the Common Minimum Programme of the administration.