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Advocacy groups NREGA Sangharsh Morcha (NSM) and People’s Action for Employment Guarantee (PAEG) have accused the Modi government of continuing its “assault”, citing “abysmal wage rates” for the workers engaged in the National Rural Employment Guarantee Scheme in FY 2022-23.
In a joint statement, they said, “The Supreme Court has repeatedly upheld minimum wages as a fundamental right and equated payment of anything less to the status of “forced labour”. Derisively low budget allocation, unremunerative NREGA wages, coupled with long delays in wage payments – even non-payment of wages in many cases – has turned many rural workers away from the employment guarantee programme.”
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The wage rates for NREGA workers for FY 2022-23 were noticed on March 28, 2022. The notification of the wage rate has been extremely late, with only 3 days remaining for the beginning of the next financial year. Such a delay prevents any discussion or debate regarding the wage rates or their adequacy. This is a continuation of the government’s assault on NREGA and has once again exposed the central government’s lack of commitment for NREGA workers’ rights.The hike ranges from a meagre Re 4 to utmost Rs 21 for various States and Union Territories (UTs). And workers of 3 States (Manipur, Mizoram and Tripura) will have to be content with no hike at all. The average increase in NREGA wage rate across the country is measly 4.25%. Whereas, Central government employees and pensioners get a dearness allowance ( DA), of 31%, costing Rs 9,544.50 crore to the exchequer each year. While the government revises DA twice a year and pays out thousands of crores for it, it systematically ignores NREGA workers.
An increase in NREGA wages, since it is a base wage, will also lead to upward pressure on rural and subsequently urban industrial wages. In times of the current economic distress, it will also increase rural expenditure, leading to an increase in aggregate demand in the economy, which is crucial for its recovery.
For 27 States and Union Territories the NREGA wage rate is less than the corresponding minimum wage for agriculture, condemning the workers to another year of bonded labour. The difference is greatest in Karnataka (despite having the highest percent increase in wage rate) where the NREGA wage rate is only 70 per cent of the state minimum wage for agriculture.
This ratio is around 70 percent for a number of States such as Jharkhand, Odisha, Bihar and Himachal Pradesh. The total average difference between NREGA wage rates and minimum wage rate for the country comes out to be around 20 percent.
At a time when the country is going through the worst employment crisis in decades, this meagre hike in NREGA wages is nothing less than a much-touted “surgical strike” on the poor. In the past few years, unemployment rates have touched historical high and have consistently remained a concern. The poor are still recovering from rural distress caused by the pandemic that led to job-loss for millions across the country.
In such a scenario, MGNREGA has been a lifeline for the rural workers -- one that provides work and cash -- in times of need and distress. It is ironic that while the country is traversing through a path of economic recovery, rural wages have remained stagnant in the same period. And by severe rationing of funds, the state is systematically undermining the programme.
Despite recommendations from government-appointed committees to link NREGA wages with state minimum wages (by Mahendra Dev Committee) and to index the wage rate to Consumer Price Index - Rural Labourers (CPI-RL) instead of Consumer Price Index – Agricultural Labourers (CPI-AL) (by Nagesh Singh Committee), or Rs 375 per day as recommended by the Anoop Satpathy Committee, the government has not implemented these recommendations.
At a time when the country is going through the worst employment crisis in decades, this meagre hike in NREGA wages is nothing less than a much-touted “surgical strike” on the poor. In the past few years, unemployment rates have touched historical high and have consistently remained a concern. The poor are still recovering from rural distress caused by the pandemic that led to job-loss for millions across the country.
In such a scenario, MGNREGA has been a lifeline for the rural workers -- one that provides work and cash -- in times of need and distress. It is ironic that while the country is traversing through a path of economic recovery, rural wages have remained stagnant in the same period. And by severe rationing of funds, the state is systematically undermining the programme.
Despite recommendations from government-appointed committees to link NREGA wages with state minimum wages (by Mahendra Dev Committee) and to index the wage rate to Consumer Price Index - Rural Labourers (CPI-RL) instead of Consumer Price Index – Agricultural Labourers (CPI-AL) (by Nagesh Singh Committee), or Rs 375 per day as recommended by the Anoop Satpathy Committee, the government has not implemented these recommendations.
For 27 States and Union Territories the NREGA wage rate is less than the corresponding minimum wage for agriculture
Additionally, the Parliamentary Standing Committee Report of the Ministry of Rural Development and Panchayati Raj had also recommended that the NREGA wage rate be indexed to the CPI (R). Despite these recommendations, the meagre increase in NREGA wage rates has not been proportional to the increase in inflation and the cost of living in the past few years.
The government does not put in public domain the methodology it uses to calculate the NREGA wage rate every year. This not only curbs discussion on the wage rates, but is also against the transparent and accountable spirit of the Act. A few States like Jharkhand (Rs 225 from Rs 198) have added from their own budgets to enhance the MGNREGA wage from the existing amount xed by the Centre.
The government does not put in public domain the methodology it uses to calculate the NREGA wage rate every year. This not only curbs discussion on the wage rates, but is also against the transparent and accountable spirit of the Act. A few States like Jharkhand (Rs 225 from Rs 198) have added from their own budgets to enhance the MGNREGA wage from the existing amount xed by the Centre.
However, on the whole, State governments would rather spend on populist schemes and doles rather than enhance a programme that can positively affect the labour market and wage rates in favour of the poor. It is nothing less than a joke that governments are not able to ensure even minimum wages to workers.
The Supreme Court has repeatedly upheld minimum wages as a fundamental right and equated payment of anything less to the status of “forced labour”. Derisively low budget allocation, unremunerative NREGA wages, coupled with long delays in wage payments – even non-payment of wages in many cases – has turned many rural workers away from the employment guarantee programme.
The Supreme Court has repeatedly upheld minimum wages as a fundamental right and equated payment of anything less to the status of “forced labour”. Derisively low budget allocation, unremunerative NREGA wages, coupled with long delays in wage payments – even non-payment of wages in many cases – has turned many rural workers away from the employment guarantee programme.
The programme must run as the demand-driven programme it was envisaged to be, with the true spirit of employment guarantee to rural citizens. NREGA Sangharsh Morcha and People's Action for Employment Guarantee strongly condemn this anti-workers decision and demand that wages are paid in a timely manner along with an increase in the NREGA wage rate to Rs 600 a day.
This follows the Seventh Pay Commission recommendation of Rs 18,000 as the minimum monthly salary six years ago in October 2016 , after which huge increases in prices have taken place.
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