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SHOULD THE RURAL JOB GUARANTEE SCHEME

BE LINKED TO MINIMUM WAGES?


e need to re- The question raises fundamental issues about the MGNREGA’s centralised template and poor delivery ulating the rural supply chain.

W member that
the way the
Mahatma
Gandhi Na-
tional Rural Employment
Guarantee Act (MGNREGA)
was originally conceived,
mechanism, but it is important to provide a legal basis to its wage structure to protect it against inflation

issue has also cropped up in


SANJAY SHARMA
DEBATE
branch in every village with he minimum wage
BS PHOTO
MGNREGA has also been the
Now, because of extraordinary
levels of food inflation, workers
are demanding that the wage
be indexed.
Platitudes like “growth with
a human face”, while paying
sub-minimum wages to MGN-
wages were never meant to
be equal to the minimum
wages; they should have been
lower. This is because the
MGNREGA is not meant to
be a job guarantee scheme in
the classical sense, it is meant
the recent debate on inflation-
indexing because the Con-
sumer Price Index for Agri-
cultural Labour (CPI-AL) al-
so varies from state to state.
So more fundamentally, as-
suming we need a rural em-
a population of more than
2,000. But there are probably
200,000 villages or more with
a population less than this.
Overall, I think the more
constructive debate would not
be this one, but how we im-
T issue encompasses
two fundamental
considerations: link-
ing minimum wages
to inflation and paying mini-
mum wages under the Mahat-
ma Gandhi National Rural Em-
single-most effective state in-
tervention in the wage mar-
ket. The whining and com-
plaining about costs to industry,
big farmers and the lack of avail-
ability of cheap migratory labour
is proof that the MGNREGA has
REGA workers, are against ba-
sic concerns of the aam aadmi,
and proof of the hypocrisy of
political promises.
In fact, the government has
partly addressed the issue in in-
dexing MGNREGA wages to in-
for people who do not tem- ployment guarantee scheme, prove the delivery mechanism, ployment Guarantee Act (MGN- partially succeeded. flation. But indexing the wage
porarily have any other job. we need to consider whether to ensure that we can devi- REGA). That minimum wages This also explains this sud- to inflation is a subset of the min-
In this context, the other we need a more central tem- ate from the centralised tem- must be paid under the MGN- den attack on minimum wages, imum wage concept and the Act.
important issue is that there plate and that also has im- plate so that we can tailor the REGA cannot be questioned. In and an attempt to dilute it at all The only way to protect the min-
is a great deal of variation plications for what you can MGNREGA to local conditions 1948 India passed the Minimum costs so that inflation drowns imum wage as prices go up is to
in wage rates across the coun- and cannot do. and use it to create, in some Wages Act, which categorical- out its protective cover. We are index the wage. The very fact
try and the minimum wage al- The other point to be con- sense, productive assets. Giv- ly stated that no worker could not willing to make essential that even this took so long to do
so varies across the states sidered is that the MGNRE- en the present structure in be paid less than the statutory correctives in the agricultural so is telling. The thought of ques-
— as they should. There are GA is already distorting the terms of wages and materials, minimum wage for a day’s work. policy, but want cheap labour to tioning the dearness allowance
states where the market rate labour market. The way it has BIBEK DEBROY it cannot really be used in this The norm related to the barest ARUNA ROY subsidise the crisis in this sec- of salaried employees never
is actually higher than the min- been constructed, it was prob- Professor, way. If you consider, say, some- minimum for a family to sur- Mazdoor Kisan tor. The government as employer crosses one’s mind. But why then
imum wages and there are ably deliberately intended to Centre for Policy Research thing like water harvesting, vive. The Supreme Court has Shakti Sangathan pleads financial constraints while should linking wages to infla-
states where it is lower. So do so. But let me flag some- there are many options. Right ruled that compromise on min- justifying non-payment of wages tion in the MGNREGA have been
there are big questions of thing else: the issue is not The MGNREGA wages now, the central template says imum wages is unacceptable To index the wages under the MGNREGA, but pro- contested? Compare MPs’ re-
whether we should have a sys- whether it is `100 a day on you can construct a check dam and that no public works pro- vides for the commonwealth of cently tripled emoluments; bu-
tem of minimum wages at all paper or whatever it is going weren’t meant to be or dig a well; now, whether gramme can pay less than the without the protection corrupt practices. The most ap- reaucrats doubled incomes cour-
or not, whether it serves any to be now. The problem is that equal to minimum these are relevant or whether statutory minimum wage. Pay- of the Minimum Wages palling aspect is the brazen role tesy the Pay Commission, and
purpose. But the pertinent is- there are huge delivery issues something else – like de-sil- ing less would amount to forced of the state in undermining the raised salaries of the judiciary
sue to this debate is that we with this scheme. There are wages since the scheme tation – is relevant is a function labour and a violation of work-
Act, is providing fundamental rights of its poor- with the passing of an order!
cannot and should not decree studies that show even if the is not a job guarantor in of local conditions, so the cen- ers’ fundamental rights. MGN- immediate succour est citizens. The only way to pro- Thus, to index the wages
a national-level minimum wage is `100 on paper, on av- tral template should allow for REGA wages are currently be- tect the standard of a minimum without the protection of the Min-
wage. This is a fundamental erage people are getting paid the classical sense. It is this. I also think the central low the minimum wage in at
while removing wage from the cannibalistic imum Wages Act, is providing
issue that goes beyond the `45 because the scheme has meant for those who menu should have enough flex- least 19 states and the Gov- the fundamental, legal effects of inflation is to index the immediate succour while re-
minimum wages debate. The not been able to weed out the ibility to use the scheme to cre- ernment of India is in contempt wage. In fact, the rational and moving the fundamental, legal
reason this is pertinent is that system of middlemen. So are temporarily ate human capital. Suppose, in the Andhra Pradesh High
basis for any minimum effectively implemented mini- basis for any minimum standard.
in the MGNREGA, we have a much more relevant to unemployed for example, I want to opt for Court in a PIL filed by workers. standard mum wages is also good macro- The implications go far beyond
central template. The moment whether the MGNREGA some short-duration training But why does paying the economic policy and explains MGNREGA workers. The gov-
we accept that MGNREGA should be linked to the CPI- counts, but we do know that and I need a stipend. If you said barest minimum in the MGN- REGA made minimum wages how and why rural India has ernment will not have any moral
wages should be linked to min- AL or minimum wages is a there are villages where the let me use the scheme to part- REGA raise such fears? The Min- tangible, increased the bargaining dealt better with the econom- authority to implement the Min-
imum wages, we also need to debate on the delivery mech- nearest post office or bank fund that stipend, why should imum Wages Act has been an power of workers and offered a ic downturn, and the drought. imum Wages Act when it is itself
accept that these wages can anism. Sure, we have said branch is miles away. The Re- the MGNREGA not have the important, if tattered, bit of pro- benchmark to fight severely de- The MGNREGA was often cit- a defaulter. It also opens the door
no longer be centrally deter- payments will henceforth be serve Bank of India has a fi- flexibility to allow that? tection that the unorganised sec- pressed wages. Recognised for ed as a source of maintaining to any other legislation over-rid-
mined — whether it should be made only through post of- nancial inclusion agenda that tor has retained as a fallback providing work, though this levels of consumption in rural ing the minimum wage and cre-
`100 or `X a day. In fact, this fices and savings bank ac- says India will have a bank As told to Business Standard to fight exploitation. The MGN- varies from state to state, the areas which played a role in stim- ating conditions of forced labour.

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