February 11, 2019
8 months

What is the issue?

Strengthening the MGNREGA would be more prudent than a targeted cash transfer plan like PM-KISAN.

What is the PM-KISAN scheme?

  • The government recently announced a cash transfer scheme called Pradhan Mantri Kisan Samman Nidhi (PM-KISAN).
  • According to the scheme, vulnerable landholding farmer families, having cultivable land up to 2 hectares, will be provided direct income support at the rate of Rs. 6,000 per year.
  • The Ministry of Agriculture has written to State governments to prepare a database of all eligible beneficiaries along with their Aadhaar numbers, and update land records “expeditiously”.
  • The letter further states that changes in land records after February 1, 2019 shall not be considered for this scheme.
  • Thus, the success of the PM-KISAN depends on reliable digital land records and reliable rural banking infrastructure.
  • However, comparing with the MGNREGA scheme, the PM-KISAN scheme is less likely to address farmer distress in the country.

What does the comparison show?

  • Wage rate - A month of MGNREGA earnings for a household is more than a year’s income support through PM-KISAN anywhere in the country.
  • For example, if two members of a household in Jharkhand work under MGNREGA (picture) for 30 days, they would earn Rs. 10,080 and a household of two in Haryana would earn Rs. 16,860 in 30 days.
  • These are lower than what the direct income support under PM-KISAN scheme could offer. (Rs.6000 per year)
  • Coverage - PM-KISAN is a targeted cash transfer programme and MGNREGA is a universal programme.
  • Any rural household willing to do manual work is eligible under the Act.
  • According to the 2011 Socio-Economic and Caste Census, around 40% of rural households are landless and depend on manual labour.
  • The landless can earn through the MGNREGA but are not eligible for the PM-KISAN scheme.
  • Further, it is unclear how tenant farmers, those without titles, and women farmers would be within the ambit of the scheme.
  • Targeting issues - There is also substantial evidence to demonstrate that universal schemes are less prone to corruption than targeted schemes.
  • In targeted programmes, it is very common to have errors of exclusion, i.e., genuine beneficiaries get left out.
  • Such errors go unrecorded and people continue to be left out.
  • Payment delay - Funds will be electronically transferred to the beneficiary’s bank account by the centre through State Notional Account on a pattern similar to MGNREGS, under PM-KISAN scheme.
  • However, lessons from the MGNREGA implementation shows that the Centre has frequently tinkered with the wage payments system in the MGNREGA.
  • Though timely generation of pay-orders have improved, less than a third of the payments were made on time.
  • Implementation - Repeated changes in processes result in a hurried bureaucratic reorientation on the ground, and much chaos among workers and field functionaries.
  • For example, during Aadhaar – MGNREGA linkage, several MGNREGA payments have been rejected, diverted, or frozen due to technical errors such as incorrect account numbers or faulty Aadhaar mapping.
  • There have been no clear national guidelines to rectify these.
  • In a recently concluded survey on common service centres in Jharkhand for Aadhaar-based payments, it was found that 42% of the biometric authentications failed in the first attempt, compelling them to come later.

What should be done?

  • On the other hand, the MGNREGA is neither an income support programme nor just an asset creation programme.
  • It is a labour programme meant to strengthen participatory democracy through community works.
  • It is a legislative mechanism to strengthen the constitutional principle of the right to life.
  • Also, the MGNREGA works have demonstrably strong multiplier effects are yet another reason to improve its implementation.
  • Along with that, work demand has been 33% more than the employment provided this year, which underscores the desperation to work among the people.
  • Despite all this, the MGNREGA wage rates in 18 States have been kept lower than the States’ minimum agricultural wage rates, which acts as a deterrent for the landless.
  • Thus, strengthening an existing universal programme such as the MGNREGA would have been a prudent move instead of introducing targeted cash transfer programme.


Source: The Hindu

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