Employment Guarantee Act-2005

• UPA Govt. National Employment Guarantee

Act-2005
• Provide legal Guarantee for at least 100 days
Employment
• On Asset creating Public work programmes
every at minimum wages to at least one able-
bodied person in every rural and urban poor and
lower middle class household.
• r
 Employment Guarantee Act-2005
• The main features of the Act-
• 1. every household in rural India- 100 days of
guaranteed employment every year- one adult
member-wages shall be paid within 7days of the
week during which work was done.
• 2. work should be provided within 15 days of
demanding it- work should be located 5km
distance
• 3. workers employed on public works- entitled to
medical treatment and hospitalization in case of
injury at work
 Employment Guarantee Act-2005
• 4. if work is not provided to anybody within the give
time, he/she will be paid a daily unemployment
allowance-one-third of the minimum wages
• 5. 5% WAGES- may be deducted as contribution to
welfare schemes like health insurance, accident
insurance, suvivor benefits, maternity benefits and
social security schemes.
• 6. transparency and accountability
• 7. The district collector/ Chief Executive Office-
responsible- at the district level
• 8. The Gram Sabha will monitor the work of the gram
panchayat by way of social audit
 Employment Guarantee Act-2005
• Role of the state Govt.
• State Govt.- shall prepare an Employment
Guarantee Programme
• Main features:
• (i) only productive works- based on economic,
social and environmental benefits, contributing
to social equity, and have the ability to create
permanent assets
• (ii)works-located in rural areas.
 Employment Guarantee Act-2005
• (iii) wages- directly linked with the quantity of
work- paid according to the schedule of rate
fixed by the State Govt.

• Cost of the Programme:

• The National Advisory Council (NAC): 1% of
the GDP or nearly Rs. 40,000 crores at 2004-
05
 Employment Guarantee Act-2005
• Critique of the Programme: it is better than
other employment generation scheme
• 80% of total fund is provided the Central
Govt.
• Critics:
• (i) it is alleged that the EGA- lacks a long-term
perspective
• No dramatic achievements have been made in
poverty reduction or in unemployment
reduction in the State
Employment Guarantee Act-2005

• (ii) selection of seasons- lean and busy season-

the long term planning of productive assets on
a sustained basis.

• (iii) issue pertains to one member of the

household-why should it be limited to one
member of the household.
• It should be a universalized employment
guarantee-
• No justification for limiting in one member of
household.
 Employment Guarantee Act-2005
• (iv) asymmetry in the programme-
• Centre passes the legislation-90% funds-the
states are expected to implement the
programme
• Obviously- efficiency and integrity of the state
administration-determine the quality of
implementation
• Last-is the question of paying minimum wages
• The implies a state –specific minimum wage-
there is no all-India minimum wage
 Employment Guarantee Act-2005
• EGS-A challenge and an Opportunity:
• Amendments- August 17, 2005
• (i) Minimum wage fixed – not less than Rs. 60
for each day of 100 days. Meghalaya-Rs.25,
Kerala-Rs.134
• (ii) the scheme has been universalized to all
persons living-rural areas instead of its being
available only to the familie’s below the
poverty line- NREGA- recognition of the ‘right
to work’
 Employment Guarantee Act-2005
• (iii) one third preference for women

• (iv) for every household- annual cap of 100

mandays- but if two members of a family are
enrolled- each 50 mandays

• (v) Centra Govt. 90% funds. The Central Govt.-

also compensate states- a fund crunch affects
employment generation
 Employment Guarantee Act-2005
• (vi) the Govt. also promised to bring a similar
scheme for urban areas.
• Conclude- NREGA- historic measure- ‘Right
to Work’
• Lord Meghanad Desai- NREGS as mere
‘palliative’- temporary measure- ‘a waiting
Room’ and not a cure for the problem.
• According to him-sure way to solve rural
unemployment-rural people came to urban
area and worked in the manufacturing sector
 Employment Guarantee Act-2005
• According to him-result in more slums- but
rural people would get- “better and more secure
income”

• Dr C.H. Hanumatha Rao-three decades study-

for Maharashtra- not satisfactory results- in a
sharp reduction of rural poverty-because it was
not linked to the building up of rural
infrastructure e.g. irrigation, rural roads, water
harvesting measure, agricultural research and
extension and institutional credit.
 Employment Guarantee Act-2005

• (i) lack of professional staff

• (ii) Lack of proper project planning
• (iii) Bureaucratic Resistance to NREGA
• (IV)Lack of transparency and Absence of Social
Audit
• (v) Inappropriate Rate of Payment. cc