The National Rural Employment Guarantee (NREG) scheme, one of the flagship programmes of the UPA government, has become operational throughout the country from First of April 2008.

The NREG Act, notified on 7th September 2005, aims at better livelihood security of households in rural areas of the country by providing at least one hundred days of guaranteed wage employment, in a financial year, to every household whose adult members volunteer to do unskilled manual work.

The choice of works suggested in the Act addresses causes of chronic poverty like drought, deforestation and soil erosion, so that the process of employment is maintained on a sustainable basis. This was the first time a country had passed a law of this nature and scale, guaranteeing livelihood security to rural households. Parliament enacted it expressing the consensus of the states to use fiscal and legal instruments to address the challenges of unemployment and poverty.

The rationale for such legislation was based on the need to provide a social safety net to rural households as well as to create assets that rejuvenate the natural resource base of their livelihood. In an economy, where 60 per cent of the people depend on agriculture for livelihood, a major share of the rural populoation is vulnerable to the vagaries of monsoon as an overwhelming share of the gross cropped area is rain-fed.

A total of 200 districts have been covered under the programme in the first phase implemented on February 2, 2006 and the same was extended to 130 additional districts in 2007-08. The Rural Development Minister, Dr Raghuvansh Prasad Singh, announced that the programme would be implemented in the rest of 274 districts of the country in its third and final phase. He also announced that the 5-year programme would be implemented within three years. He said the scheme has brought about a paradigm shift both in the design and the approach of intervention mechanisms of wage employment programmes.

Significance of NREGA

The significance of NREGA lies in the fact that it operates at many levels. It creates a social safety net for the vulnerable by providing a fallback employment source, when other employment alternatives are scarce or inadequate.

It adds a dimension of equality to the process of growth. It creates a right-based framework for wage employment programmes by conferring legal entitlements and the right to demand employment upon the workers and makes the government accountable for providing employment in a time bound manner. By prioritizing natural resource management, and emphasizing the creation of durable assets it holds the potential of becoming a growth engine for sustainable development of an agriculture-based economy.

Although the programme is not confined to BPL families, experience shows that it is mainly the poor households willing to do manual labour, who seek employment under NREGA. It is also evident that the nature of employment is seasonal and that the duration of employment sought varies according to prevailing opportunities of employment offered under local agricultural practices and other alternative forms of employment and all Job card holding families do not necessarily request for the full 100 days of employment.

Salient Features of NREGA

The Gram Panchayats after due verification will issue a job card. Work should ordinarily be provided within 5 km radius of the village or else extra wages of 10 per cent are payable. Disbursement of wages has to be done on weekly basis and not beyond a fortnight. At least one-third of persons to whom work is allotted work have to be women. Work site facilities such as crèche, drinking water and shades have to be provided.

Pancyati Raj institutions have a principal role in planning and implementation. A 60:40 wage and material ratio has to be maintained. Contractors and use of labour displacing machinery is prohibited. Social Audit has to be done by the Gram Sabhas. Grievance redressal mechanisms have to be put in place for ensuring a responsive implementation process. All accounts and records relating to the scheme are to be made available to any person desirous of obtaining a copy of such records, on demand and after paying a specified fee.

Possible Works
Water conservation, drought proofing including plantation and afforestation, irrigation canals, minor irrigation, horticulture and land development on the land of SC/ST/BPL/IAY and land reform beneficiaries, renovation of traditional water bodies, flood protection, land development, rural connectivity, any other work that may be notified by the Central Government in consultation with the State Governments.

Vigilance & Monitoring

The Minister asserted that vigilance and monitoring mechanisms have been strengthened for effective implementation of the scheme. More measures are being taken for transparent implementation of the programme. The States have been advised to conduct social audit of each and every work and set up grievance cells at different levels. The States have also been asked to release wages to the workers through banks and post offices by opening accounts. The process has been set in motion in Andhra Pradesh, Jharkhand and Karnataka and some other states have also reported progress in this regard.

Vigilance and Monitoring Committees have been set up at State as well as District levels. Local MPs are the members of the District Vigilance and Monitoring Committees.

Performance Highlights

According to latest figures, employment provided to 3.08 households as against the demand by 3.10 households. A total of 121.64 crore persondays have been created. This includes 32.89 crore persondays of Scheduled Castes (27.04 per cent) and 36.50 crore persondays of Scheduled Tribes (30 per cent). Women constituted 51.24 crore persondays (42.13 per cent). 2.50 crore Job cards have been issued and the number of filled muster roll stood at 11.27 lakh.

Plan of Action

The Centre has issued instructions to state governments for coordination with the Department of Posts to ensure that accounts of NREGA workers are opened in banks and post offices for payment of wages and are made fully effective during 2008-09. A Citizen Information Board has been introduced. The Board, to be displayed at all prominent places, will enable the local community to know the works being undertaken under NREGA and would also facilitate the process of spreading awareness about the programme.


The Centre has also decided to introduce awards to be known as Rozgar Jagrookta Puraskar to recognize the outstanding contribution by the civil society organizations for promoting effective implementation of NREGA in different states. The States have been directed to set up State Fund under the NREGA for greater accountability in Fund Management. The implementation of NREGA is monitored on regular basis.

No doubt, the implementation of the NREG programme has strengthened the bargaining capacity of the workers in fixing the minimum wages. It also gave a big boost to the water conservation. Its implementation in some of the naxal-affected areas was very effective. The minister admitted that it also helped in reducing the distress migration of labourers from rural areas to the urban locations.

by - V. Mohan Rao (Journalist)

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