NATIONAL RURAL EMPLOYMENT GUARANTEE ACT- NREGA – outcome has been and will be disastrous – Why ?.... 1- NREGA – High scale of leakages from the scheme is known and its financial cost and consequently contributes to fiscal deficit. 2- NREGA basically assures every family anywhere in the Indian country side of 100 days employment annually. In Kolkata, Kolkata Municipal Corporation employs cleaner in afternoon ( 1-4pm) to broom sweep roads under the same scheme. 3- NREGA has failed to create durable assets, even confessed by Jairam Ramesh, the UPA minister-rural development in December 2013. A scheme in operation if it fails to produce assets then it is total loss to the country and money wasted and fiscal deficit widens. Recurring benefits must be produced for scheme to be successful and national assets multiplies. 4- NREGA is obsessed with employment and uses most labour intensive techniques and rudimentary tools. No machinery but cheapest locally available materials. Supervision is on wage payment and not on end product. Projects are mostly never completed and if completed then in first rain and monsoon they are washed away and had to be done again. No body in NREGA suffers any pain for the loss. 5- NREGA created assets should have been private farmers property, so that farmer would have looked after it and maintained to save it. 89% of these assets are public goods, common property and allowed to lapse in terminal decay. 6- NREGA and Food Security Act together are big contributor to inflation in India, as production of marketable goods dwindles due to labour short supply which in turn increases wages and then production cost in chain, which finally imposes inflationary cost on poor. 7- 1999 to 2004 - NDA achieved price stability. Prices rose significantly in 2008 of UPA rule and exploded in 2011-13. It was due to shortfall of output and incentives induced by NREGA and FSA. 2008 was the year when NREGA was rolled out nation-wide. Food prices went up, production went down. Indian inflation was higher than global rates so foreign hand could not be blamed. 8- NREGA and FSA effect led to the fall of UPA II. It was clearly written on horizon in election 2014 and peoples gladly decimated the UPA II very smoothly. UPA II never accepted that after-effects of NREGA and FSA were actually disastrous for economy and galloping inflation and decreasing marketable productions. LESSON: Narendra Modi NDA sarkar must phase out NREGA and FSA in its present format and make it asset oriented for development of infrastructure, road, toilets, drainage, water supply, sewage treatment in villages and towns with local resident partnership.
Posted on: Sun, 14 Dec 2014 07:56:17 +0000
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