What is the issue?
The gap between the minimum agricultural wages and MGNREGA wages is growing steadily in the last few years.
What are these wages meant for?
- Minimum agricultural wage - It is paid to agricultural workers.
- It is fixed by the respective state governments.
- The Supreme Court has upheld the minimum wages as a fundamental right.
- Moreover, any labour provided at below minimum wage is a “forced labour”.
- MGNREGA wage - The NREGA was enacted in 2005 for livelihood security.
- The Central Government may, by notification, specify the wage rate for the purposes of this Act.
- This is notwithstanding anything contained in the Minimum Wages Act, 1948.
- Different rates of wages may be specified for different areas.
- Wage rate may be specified from time to time, at a rate of not less than 60 rupees per day.
What is the discrepancy?
- The union government brought MGNREGA wages at par with minimum agricultural wages in 2009.
- Notably, in 2011, only 4 states, Kerala, Goa, Haryana and Mizoram, had minimum agricultural wages higher than MGNREGA wages.
- In 2016, NREGA wages were lower than minimum wages in almost half of India’s states.
- Since then, the gap between the two sets of wages has grown steadily.
What is the latest revision?
- The Union government recently issued the revised wage rates for MGNREGA workers.
- The average wage hike for FY 2018-19 is 2.9%.
- This is only slightly higher than last year’s 2.7%.
- In 2016-17, the average wage hike was 5.7%.
- Some states have seen only Rs 2 increase in daily wages.
- The wages remain unchanged in 10 states.
- These include states like Jharkhand, Bihar, Uttarakhand and Arunachal Pradesh.
- Notably, these are states where the wages are already the lowest.
- Unlike this year, in 2017-18 every state had an upward wage revision, even if marginal.
- With the latest revision, 28 out of 36 states and UTs have NREGA wage below the minimum agricultural wage.
Why is the disparity?
- The Ministry of Rural Development (MoRD) set up the Mahendra Dev (2014) and Nagesh Singh (2016) Committees.
- But the Finance Ministry failed to implement these recommendations.
- The rejection of Mahendra Dev Committee’s recommendations led to the lowest ever NREGA wage increase until 2017.
- Nearly five states received an increase of only a rupee.
- In 2018, the wages hit a new low after the Nagesh Singh Committee’s report was turned down.
What are the recommendations made?
- Mahendra Dev Committee - Workers should be paid either the minimum wage or the NREGA wage, whichever was higher.
- The panel estimated the need for an additional allocation of Rs 6,000 crore.
- This was a 17% increase to the then MGNREGA budget.
- The annual revision of NREGA wages should be based on CPI-R instead of CPI-AL.
- Consumer Price Index-Rural (CPI-R) reflects the current consumption pattern of rural households.
- On the other hand, CPI for Agricultural Labourers (CPI-AL) is based on a 35-year-old consumption basket.
- The Finance Ministry had turned down these recommendations.
- It insisted on setting up a panel to study the financial implications of the Mahendra Dev report.
- Nagesh Singh Committee - There was no need to bring MGNREGA wages on a par with minimum wages of states.
- But, the annual wage revision should be linked to CPI (R).
- As, CPI (R) is a better indicator of wage increase as it gives lower weightage to food items.
- Whereas, the basket of goods for calculating CPI (AL) is mainly food items (up to 72%).
What is Finance Ministry's argument?
- The Finance Ministry, however, argued that moving to CPI-R was not advisable at this stage.
- Besides food items, CPI-R gives weightage to expenses incurred on education, transport and communication, recreation, health, etc.
- The ministry said that these “miscellaneous items” under CPI-R might not represent the demand of NREGA workers.
- Moreover, such a move would lead to a bigger fiscal burden.
Why is raising NREGA wage important?
- The NREGA was primarily enacted for the enhancement of livelihood security of the households in rural areas.
- A Supreme Court’s order mentions MGNREGA work as the last recourse while seeking work.
- A lower payment for this would push the worker and the family into “sub-human existence”.
- On an average, 5 crore rural households rely on the scheme each year for their livelihood.
- This increases in times of rural distress, as people use the scheme to make up for falling farm incomes.
- Nearly 40% of the beneficiaries of the scheme are estimated to have been SCs and STs, bearing a social implication as well.
- The government should address the disparity in the wages to make sense to the purpose of NREGA.
Source: Indian Express
