Poverty in India: Profiles, Policies and Programmes
Rajiv Balakrishnan and S. N. Jha
The relevance of low incomes, meagre possessions and other aspects of what are understandably seen as economic poverty relates ultimately to their role in curtailing capabilities—that is, their role in severely restricting the choice people have to lead valuable and valued lives. Poverty is, thus, ultimately a matter of capability deprivation and note has to be taken of that basic connection not just at the conceptual level, but also in economic investigations and in social and political analysis.1
The Constitution emphasizes equality as one of its basic principles, and large-scale poverty is clearly at variance with that norm.2 Fighting poverty was, therefore, a major objective of planning, with the ‘poverty line’ conceived as a conceptual and analytical tool.3 It was in 1962, when the Perspective Planning Division of the Planning Commission targeted a minimum level of living by the end of the Sixth Plan, that the definition of the poverty line was first attempted. ‘It was suggested that the expenditure needed to obtain 2,400 calories per capita per day in the rural areas and 2,250 calories per day in the urban areas, plus the extra amount needed to meet other basic requirements—the latter reckoned at 20 per cent of the expenditure on food—defined the threshold, or the poverty line, for the purpose of identification of the poor households’.4 The norms were however subsequently revised, when the Task Force on Minimum Needs 1979 (Perspective Planning Division) fixed the calorie norms at 2,400 and 2,100 per capita per day for rural and urban areas, respectively. To meet these calorie requirements, per capita monthly consumer expenditures of Rs 49.09 and 56.64 in rural and urban areas, respectively, were thought adequate.5 With changing price levels, the poverty line, defined in terms of per capita expenditure, has had to be continually updated.
It must be noted, however, that this approach to poverty measurement has some serious defects. For instance, it assumed that the poor will go in for the cheapest calories, whereas consumption patterns are more likely to be determined by cultural tastes and preferences.6 Furthermore, the calorie norm does not necessarily reflect the adequate intake of different nutritional requirements like fats, proteins and micro-nutrients.7 Another important limitation is with respect to the identification of non-food needs of poverty line households. It is assumed that the amount spent by such households on non-food items represents the basic needed expense on items other than food, which is an extremely restrictive assumption.8
HEAD COUNTS, SEVERITY RATIOS AND ABSOLUTE NUMBERS OF POOR
Given the parameters identified by the 1979 Task Force, there have been a number of official as well as non-official estimates of poverty ‘head counts’.9 This approach to poverty measurement is based on estimates of consumption expenditure of households by the National Sample Surveys. Apart from the ‘thin’ sample on which such estimates are based,10 they are found wanting also because of their inability ‘to capture…variations in…intensity…’.11 In other words, a glaring deficiency of the ‘head count’ approach is that it does not indicate how far below the poverty line the poor really are.12 However, the challenge of measuring the ‘depth’ or ‘severity’ of poverty has led to measures such as the Poverty Gap Index, the Sen Index and the FTG index.13
Apart from poverty ratios, the absolute numbers of the poor are also a matter of concern. While the percentage of the poor in the population has decreased to about one half to about one third between 1951 and 1997, the ‘number of people with real incomes falling below the poverty line has increased from about 160 million in the early 1950s to about 320 million by the mid-1990s’.14 A higher rate of population growth and a tardy economic showing has resulted in this situation of increasing numbers of the poor even when their proportion declines. Population growth has, in fact been identified as a key element in the fight against poverty; it has been argued that ‘except for some of the oil rich countries in the Middle East, no country has succeeded in achieving a high per capita income and low poverty ratio whose population is continuing to grow fast’.15
THE POLICY RESPONSE
After Independence, measures to reduce poverty were undertaken by the governments at the Centre and the states. These include measures to prevent concentration of income, programmes under the Five-Year Plans, and targeted programmes like the Integrated Rural Development Programme (IRDP), National Rural Development Programme (NRDP), Antyodaya and the Jawahar Rozgar Yojana. In all the Plans, particularly since the Fifth Plan, poverty reduction and the provision of basic needs were emphasized. The government's approach has been two pronged—the promotion of economic growth and direct action for poverty alleviation.16
The Five-Year Plans
The First Plan (1951–1956) sought to build up from the ravages of colonial exploitation and the partition that Independence brought in its wake. Despite the Plan's emphasis on all-round balanced development, agriculture and irrigation was accorded a prioritized sectoral outlay (44.6 per cent). While the industrial sector received lower priority, development of power, rural development through community development projects and social welfare programmes received more attention.
The Second Plan (1956–1961) aimed at the industrial development of the country. Emphasis was placed on reducing the concentration of wealth and income to benefit the less-privileged sections of society.
The Third Plan (1961–1966) defined its objective in terms of self-sustained growth. It sought self-sufficiency in agriculture, growth of basic industries, maximum utilization of manpower resources, and decentralization of economic power. While national income grew by 2.6 per cent against the target of 5 per cent, the price index in 1965–1966 was 32 per cent higher than that in 1960–1961. The Indo-Pakistan War, Sino-Indian conflict and failures of the monsoon were important factors in the setback.
The poor shape of the economy ultimately led to a ‘Plan Holiday’, which saw Annual Plans from 1966 to 1969. These were meant to continue the unfinished tasks of the Third Plan.
In the Fourth Plan (1967–1974), ‘growth with social justice’ provided a new orientation to the planning process. The importance of growth in both agricultural and industrial sectors was recognized.
The Fifth Plan (1974–1979), though formulated in a period when the economy was facing severe inflationary pressures, attempted to start a separate set of programmes for combating poverty, apart from those that aimed at overall growth and redistribution. These new programmes were aimed at meeting specified needs of the poor, up to a quantified minimum level, uniformly across the country. The aim of the government was to provide the people with an income of Rs 40 per month, which was determined as the ‘poverty line’ at 1972–1973 prices. Increase in employment opportunities, self-sufficiency, policy of minimum wages, removal of regional imbalances and encouragement to exports received priority attention.
The Sixth Plan (1980–1985) had the removal of poverty as its foremost objective. Stress was laid on economic growth, equality of income, self-sufficiency in technology, improvement of the pubic distribution system and the betterment of the quality of life of the weaker sections of society. The plan included a number of time-bound minimum needs programmes (MNPs) for the poor, for which the allotment represented a fourfold increase over the corresponding allotment in the Fifth Plan. National Sample Survey reports showed that the percentage of people living below the poverty line declined from 48.3 per cent in 1977–1978 to 36.9 per cent in 1984–1985.
The Seventh Plan (1985–1990) prioritized three sectors—food, work and productivity. Poverty remained a priority, with the poverty-ratio expected to decline from 37 to 26 per cent by 1990.
The Eighth Plan (1990–1995) was not conceived much differently from the previous plans. It aimed for a growth rate of 5.5–6.5 per cent (of overall GDP), an agricultural growth rate of 5 per cent, industrial growth rate of 12 per cent and service sector growth rate of 8–10 per cent.
The Ninth Plan (1997–2002) recognized the significance of providing seven basic minimum services (including education, primary health care, safe drinking water, nutritional security, shelter, and connectivity) to the poor to improve their living conditions. It sought to provide these services to the poor in partnership with state governments, Panchayati Raj Institutions and self-help groups. Poverty alleviation programmes were to be oriented towards ‘strengthening productive potential of the economy, and providing more opportunities for involving the poor in the economic process’. Therefore, poverty was sought to be eradicated with the involvement of the poor themselves, through social mobilization, participatory approaches and the empowerment of the poor. The plan document also emphasized a high degree of convergence between poverty alleviation programmes, area development programmes and sectoral schemes.
The Tenth Plan (2002–2007) document set out a target for poverty reduction and creation of gainful employment. Compared to 1999–2000, poverty is expected to decline by 15 per cent by 2011–2012. This will be dependent on the effective implementation of the poverty alleviation programmes. Expansion of the self-employment and wage employment programmes and their effective implementation are also focused upon in view of the expected additions to the labour force in the next five years. The Swarnjayanti Gram Swarozgar Yojana (SGSY) started during the Ninth Plan was to be continued with a focus on social mobilization and group formation in the first phase, thrift and credit amongst members in the second phase and access to credit in the third phase. The Sampoorna Gramin Rozgar Yojana (SGRY) would continue to be the single wage employment programme for the rural poor, whereby payments will be made both in cash and in grain so as to ensure a minimum level of food security.
Nationalization of Banks
The nationalization of 14 banks in 1969 was a major step—the pre-1969 scenario in the banking sector had shown concentration in urban business, with banks focusing on the financing of large industries and wholesale trade. The objective of nationalization was to enable reduction of regional imbalances in banking development and make banks more responsive to national requirements. Banks rapidly increased their network of branches in rural areas. They also initiated changes in their credit policy to prioritize credit flow to the weaker sections, agriculture and small-scale industry.
Growth in rural banking registered an increase, with the expansion of the branch network of commercial banks. The number of bank offices increased from 8,262 in June 1969 to 34,587 in December 1980, and many of the new offices were in the rural areas. Almost all development blocks of the country were covered by commercial banking, excepting in a few regions like the North East. The population per branch was reduced from 65,000 in 1969 to 16,000 in December 1980. The Integrated Rural Scheme or gramodaya project of the banks was envisaged for all-round progress in rural areas, and especially, the poorer villages.
The main policy of the banks with regard to agricultural financing was the ‘intensive area approach’, in which villages were adopted by their branches on a cluster basis. The purpose of village adoption was to ensure benefits trickled down to the smallest of farmers.
In 1972, under the directives of the Reserve Bank of India, commercial banks increased their lending to priority sectors like small-scale industries and small business. Banks were encouraged to provide funds for the neglected sectors of the economy, for example, transport operators and small businesses. The share of priority credit rose from 14 per cent in 1969 to around 33 per cent in 1980 and still further to 42 per cent in 1988.
Differential Interest Rate Scheme
The Differential Interest Rate (DIR) scheme was introduced by the government in 1972 for providing the weaker sections credit at a concessional rate of 4 per cent interest per annum. In the beginning, the scheme was put into effect only selectively. After 1977, it was expanded and banks were assigned definite targets. When the DIR became a part of the government's 20-point programme, it sought to reinforce its lending to specified categories of the weaker sections. District Credit Plans were drawn up for enabling better credit facilities and to fill up existing credit gaps in the rural and semi-urban areas.
The Twenty-Point Programme
In July 1975, Prime Minister Indira Gandhi announced the 20-Point Programme for reducing poverty and uplifting the weaker sections of the society. The programme included policy initiatives like the control of inflation, incentives for production, welfare of the rural population, help to the urban middle classes, and the control of economic and social crime. Other elements of the programme were:
- Improvement of irrigational facilities
- Production programmes for rural employment
- Distribution of surplus land
- Minimum wages to landless labourers
- Rehabilitation of bonded labour
- Development of scheduled castes (SCs) and scheduled tribes (STs)
- Growth of housing infrastructure
- Increase in power production
- Family planning
- Tree plantation
- Extension of primary health facilities
- Programmes for welfare of women and children
- Increase in primary education
- Strengthening of the public distribution system (PDS)
- Simplification of industrial policies
- Control of black money
- Betterment of drinking water provisions
- Development of internal resources
After change of government at the Centre in January 1982, significant importance was attached to the revised rural development programme, with an emphasis on attacking rural poverty and improvement of the conditions of the SCs and STs. In August 1986, in the light of the Sixth Plan experience, the 20-Point Programme was restructured. The elements of the restructured programme included:
- Eradication or poverty
- Raising of productivity
- Reduction of income disparities and along with it, socio-economic disparities, and improvement of the general quality of life
- A strategy for rain-fed agriculture
- Better use of irrigation water
- Enforcement of land reforms
- Special programmes for rural labour
- Clean drinking water
- Health for all
- Two-child norm
- Expansion of education
- Justice for SCs and STs
- Equality for women
- New opportunities for youth
- Housing for the people
- Improvement of slums
- New strategy for forestry
- Protection of the environment
- Concern for the consumer
- Energy for the villages
- Responsive administration
Poverty Alleviation and Employment Generation Programmes
SFDA and MFAL In the Fourth Plan period (1969–1974), to further the objective of self-sufficiency of small and marginal farmers, the Marginal Farmers and Agricultural Labour (MFAL) programme and the Small Farmers Development Agency (SFDA) were established. Under the aegis of these programmes, the productivity of smallholdings was sought to be raised and the condition of landless labourers improved via the generation of employment through subsidiary occupations. In drought-prone areas, the Rural Work Programme (RWP) was started to provide employment.
The Fifth Plan (1974–1979) merged SFDA and MF AL into a single scheme and provided for its expansion. Also, the RWP was reorganized as Drought Prone Areas Programme (DPAP). In 1978–1979, all these programmes were replaced by the IRDP, whose purpose was to generate employment and raise the income level of the target groups—small and marginal farmers, share croppers, agricultural labourers, rural artisans, and the SCs and STs.
Integrated Rural Development Programme (IRDP) The IRDP has been a major instrument of the government for alleviating poverty. The philosophy underlying IRDP is to attack rural poverty by providing the poor with productive assets and skills, so that they are assured of a regular income. At both the conceptual level and in operational terms, the IRDP is meant to be an exercise in micro-level planning, whereby small households are provided with locally available resources, and skills are imparted to beneficiaries. To maximize the impact of the IRDP, the household plan is required to be integrated with the block sectoral resources and spatial plans.
Under the programme, the family is the basic unit of development. Selected families are provided help to rise above the poverty line by taking up self-employment ventures—agriculture, horticulture and animal husbandry in the primary sector; weaving and handicrafts in the secondary sector; and service and business activities in the tertiary sector. The IRDP was meant to achieve its objective within a limited time frame. The guidelines suggested that at least 50 per cent of the beneficiaries should be from the SCs and STs, 40 per cent should be women and 3 per cent from the physically handicapped categories.
The programme was launched by the central government in March, 1976, in 20 selected districts. It extended to 2,300 blocks in 1978–1979. By 1980, it was in operation in all the blocks in the country.
Several institutions have carried out studies on the IRDP: Reserve Bank of India (RBI), the National Bank for Agriculture and Rural Development (NABARD), the Institute of Financial Management and Research (IMFR), Madras, the Programme Evaluation Organization (PEO) of the Planning Commission. Several of these studies have raised serious issues in relation to the effect of IRDP on the quality of life of the people below the poverty line. Without questioning the overall utility of the scheme, the criticisms mainly refer to corruption charges, which cause suffering to the poor. Further, since loan recovery from the poor is difficult, bank officials are often reluctant to provide loans. The poor, on the other hand, are not much interested in the programmes out of fear of not being able to repay. Corruption, malpractice and misuse adversely affect the implementation of the loan programme.
Training Rural Youth for S elf-Employment (TRYSEM) TRYSEM was started in August 1979, as a supporting component of IRDP to develop technical skills in the diverse fields of agriculture, industry, services and business. Eligible youth had to be in the age group of 18–35, and from families below the poverty line. Priority was to be given to youth from the SCs and the STs, ex-servicemen and those who have had school education up to Class IX. One-third of the seats in TRYSEM were reserved for women.
National Rural Employment Programme (NREP) The NREP, instituted in April 1977 for generating employment opportunities in the rural areas, was originally called the Food for Work Programme (FFWP). It created 44 million man-days of employment in 1977–1978, 355 million man-days in 1978–1979, and 534 million in 1979–1980. It drew on 1.28, 12.47 and 23.45 lakh tonnes of food grains, respectively, in the 3 years. The work undertaken included flood protection; maintenance of existing roads; provision of new links; improvement of irrigation facilities; construction of panchayat ghars, school buildings and medical and health centres; and improvement of sanitation in rural areas.
Due to shortcomings that came to light, the FFWP programme was restructured as the NREP in October, 1980, when it became part of the Sixth Plan (1980–1985). This programme is targeted at agricultural labourers who depend on wage employment and virtually have no source of income in the lean period. Important features of the NREP are listed below:
- Ten per cent earmarked allocation for drinking water wells in the harijan colonies, including community irrigation schemes in harijan areas.
- Ten per cent allocation to be set aside for social forestry and fuel plantations.
- Works of durability only to be undertaken.
- Allocations to be made both at inter-state and inter-district/block levels, the state governments get their share from the central government every quarter.
- Maintenance of assets created by this programme to be deemed the responsibility of the states.
- These programmes to actively involve Panchayati Raj Institutions.
The Sixth Plan released Rs 980 crore for this programme from funds in the Central Plan. In 1980–1981, that is, the first year of the Sixth Plan, the entire cost of Rs 340 crore was borne by the Centre. From 1981 to 1982, the cost of NREP was borne on a 50:50 sharing basis by the Centre and the states.
In the Sixth Plan, NREP schemes generated 700 million man-days of work, thereby providing employment to 8 to 10 per cent of the rural poor. Subsequently, the Seventh Plan (1985–1990) provided assistance to about 20 million families.
Rural Landless Employment Guarantee Programme (RLEGP) The RLEGP was launched in the Sixth Plan with a view to providing supplementary employment to the poor in public works. The programme viewed employment as an integral component of development. RLEGP is similar to NREP but has a special emphasis on the landless in the provision of employment. The basic objectives of the programme include the following:
- Improvement and expansion of employment opportunities for the rural landless.
- A guarantee of employment to at least one member of every rural landless labour household for up to 100 days in a year.
- Creation of durable assets for strengthening the rural infrastructure, which was to lead to a rapid progress of the rural economy.
RLEGP is fully funded by the central and the state governments. It is entrusted with the responsibilities of planning, supervision, monitoring and implementation of work projects. Apart from the incidence of poverty, the criteria for allocation of funds to the states include (a) the number of agricultural workers and (b) the number of marginal farmers. The programme requires the wage component in the total cost of a project to be not less than 50 per cent, and the rate of wage paid to the labourers to be fixed at the statutory minimum level.17
Jawahar Rozgar Yojana (JRY) The JRY announced in April 1989, merged together the programmes under NREP and RLEGP that were in place in the first 4 years of the Seventh Plan period. This was the single largest employment-generating programme under the Eighth Plan, with the twofold objective of infrastructure development and the generation of wage employment. Poverty alleviation under the JRY aims, through decentralized planning in rural areas, to create the durable assets that were conceived as an instrument to provide an impetus to the development of the rural economy. The work to be undertaken were in the areas of social forestry, soil and water conservation, irrigation and flood control, construction of community assets, rural sanitation and rural housing.
Under JRY, it is expected that at least one member of each poor family would be provided employment for 50 to 100 days in a year at a work place near his/her residence. About 30 per cent of the jobs under this scheme are reserved for women. Preference is given to SC and ST families. The scheme is the responsibility of the village panchayat. Panchayats with populations of 4,000–5,000 are given assistance of Rs 80,000 to 1 lakh.
On the basis of the working of the scheme, certain modifications were made in 1993–1994 to ensure better implementation. The primary idea was to achieve 90 to 100 days of employment per person in the backward districts, where there was a concentration of unemployed persons. People below the poverty line constituted the target group for the programme, and preference was given to the SCs and STs and freed bonded labourers. Reservation for women was continued.
JRY is centrally sponsored. Its expenditure is shared by the Centre and the states on an 80:20 basis, which was changed in 1990 to a 60:40 basis.
A review of the sectoral expenditures under JRY between 1989 and 1993 indicates that about 23.5 per cent of allocation was for building roads, 16 per cent for construction of wells, 12.5 per cent for construction of houses, 11.4 per cent for minor irrigation, 7.9 per cent for schools and community buildings, 5 per cent for social forestry, and 23.7 per cent for other rural projects.18 The creation of durable productive community assets had high priority, with emphasis on developing the infrastructure required for the implementation of poverty alleviation programmes like Desert Development Programme (DDP), DPAP, Development of Women and Child in Rural Areas (DWCRA), and IRDP and the construction of primary school buildings.
JRY has two sub-schemes—Indira Awas Yojana (IAY) and the Million Wells Schemes (MWS). IAY was launched in 1985–1986 as a part of the RLEGP and was aimed to provide free dwelling units to the beneficiaries belonging to the poorest sections, the SCs and the STs, and freed bonded labourers. The scope of eligible beneficiaries was extended in 1995–1996 to include the families of armed and para-military forces killed in action. The MWS provided financial aid for constructing open irrigation wells. Thirty per cent of the allocation for MWS is provided at the state level. Both IAY and MWS are extended to the non-SC and ST families with the proviso that the outlays do not exceed 4 and 10 per cent of the total allocation, respectively.
The JRY was perceived as a multifaceted programme covering social forestry on government and community lands; soil and water conservation works; water harvesting structures; minor irrigation; flood protection; drainage and water-logging works; construction and renovation of village tanks, irrigation wells and field channels; and the construction of houses and sanitary latrines in rural areas. The building of rural roads, land development, and reclamation of wasteland and degraded land are among the other works under JRY. Around Rs 700 crore were allocated under the scheme to intensify the programme in 120 backward districts (of different states), where the incidence of the unemployed and underemployed is high. Further, special projects for the prevention of migration of labour, enhancement of women's employment, and special programmes by voluntary agencies for drought and watershed and wasteland development were sponsored under the JRY.
The JRY was recast in 1990 to include urban wage employment, urban micro-enterprises and housing and shelter upgradation. Under the second and third of these schemes, the urban poor were assisted to upgrade their skills and set up self-employment ventures, and were provided wage opportunities in which their labour was utilized for the construction of socially useful public assets under the jurisdiction of urban local bodies. The three schemes involved loan and subsidy components of around Rs 600 crore in 1993–1994. JRY covered around 46 per cent of the population.
Minimum Needs Programme The MNP was taken up in 1974–1975 as a part of the Fifth Plan. Sectors within its scope included adult education, rural health, water supply, road building, electrification, houses for landless labourers, nutrition in rural areas and the improvement of environmental condition in urban slums. The amount released for MNP in 1974–1979 was Rs 1,518 crore and during 1980–1985, it was Rs 5,807 crore. A study of the Centre for Policy Research shows that in the Sixth Plan period, 34.5 per cent of the expenditure was on rural water supply, 20.1 per cent on rural roads, 17.8 per cent on elementary and adult education, 9.8 per cent on rural health, 6.1 per cent on rural housing for the landless labourers, 5.2 per cent on rural electrification, 3.8 per cent on nutrition for children and health care for pregnant women and 2.6 per cent on improving urban slums.
Swarnjayanti Gram Swarozgar Yojana Launched on 1 April 1999, SGSY is a self-employment programme for the rural poor. It replaces the earlier self-employment and allied programmes like IRDP, TRYSEM, DWCRA, Supply of Improved Tool-Kits to Rural Artisans (SITRA), Ganga Kalyan Yojana (GKY) and MWS. The SGSY builds on the strengths of the earlier programmes, taking care to avoid the pitfalls. It aims at providing an appreciable sustained level of income over a period of time to bring beneficiaries above the poverty line. The programme seeks to work with community involvement by organizing the rural poor into self-help groups and encouraging them to prioritize their needs and allocate resources accordingly. The beneficiaries can either be individuals or groups, selected on the basis of the BPL (below poverty line) census, duly approved by the Gram Sabha. The State, along with the banks, helps by providing for capacity building and income-generating assets, including infrastructure development. The scheme is being implemented on a cost sharing ratio of 75:25 between the Centre and the states. SGSY lays stress on the cluster approach, with each development block concentrating on a few key activities so that people can draw on local resources and strengths.
Sampoorna Gramin Rozgar Yojana On 15 August 2001, a new scheme (SGRY) was launched, with an annual outlay of Rs 10,000 crore, to provide greater thrust to additional wage employment, infrastructure development, and food and nutritional security in rural areas. The earlier wage employment scheme for rural areas, the Employment Assurance Scheme (EAS), meant to provide wage employment for the rural poor and the infrastructure development scheme, was merged with the Jawahar Gram Samridhi Yojana, a scheme designed to create durable social and economic community assets and infrastructure development in rural areas. The beneficiaries, all rural poor, include the SCs and STs, agricultural labourers, non-agricultural labourers, marginal farmers, women, and the parents of child labourers withdrawn from hazardous occupations. The work involved is largely unskilled, in and around the village or habitat. Food grains are given in lieu of the day's wages at the rate of at least 5 kg per man-day.
Pradhan Mantri Gram Sadak Yojana (PMGSY) Recognizing the significance of road connectivity in rural development by promoting access to economic and special services and hence increased agricultural income and productive employment opportunities, PMGSY was launched on 25 December 2000 as a 100 per cent centrally sponsored scheme to provide connectivity by way of all weather roads to the unconnected habitations in the rural areas in such a way that habitations with a population of 1,000 and above are covered in 3 years and all habitations with population of 500 and above by 2007. For the hilly areas, desert areas and the tribal areas, the habitations with population of 250 and more is sought to be covered. Till December 2002, 10,882 road works had been completed providing connectivity to 12,508 habitations with an expenditure of Rs 3,321.59 crore. The present source of funding for PMGSY is the diesel cess, 50 per cent of which is earmarked for the programme. Efforts are on to mobilize additional resources for the programme with the financial assistance of World Bank and the Asian Development Bank.
Pradhanmantri Gramodaya Yojana (PMGY) and PMGY Gramin Awas PMGY was launched in 2000–2001 in all the states and the union territories (UTs), with additional central assistance to the states and UTs to focus on providing certain basic minimum services to the rural populace to ensure sustainable rural development. PMGY initially had five components, primary health, primary education, rural shelter, rural drinking water and nutrition. In 2001–2002, rural electrification was added as an additional component. Another scheme, PMGY (Gramin Awas) scheme seeks to achieve sustainable habitat development at the village level.
PMGY (Rural Drinking Water Project) Under the programme, of the total allocation, at least 25 per cent has to be used by the states and UTs for water conservation, water harvesting, recharge of ground water and making drinking water sources sustainable in the areas under the Desert Development Programme and Drought-Prone Area Programme.
Swaran Jayanti Sahari Rozgar Yojana (SJSRY) The earlier urban poverty alleviation programmes were replaced by a comprehensive SJSRY of which Urban Self-Employment Programme and Urban Wage Employment Programme are two special schemes. The programme is funded on a basis of a ratio of 75:25 between the Centre and the states.
Antyodaya Anna Yojana The scheme was launched on 25 December 2001 with an aim to reach 1 crore of the poorest families of the BPL families covered under the Targeted Public Distribution System (TPDS). These families were to be provided with 25 kg of food grain at a highly subsidized rate of Rs 2 for wheat and Rs 3 for rice. The entitled quantity was enhanced to 35 kg with effect from April 2002 for one year.
Annapurna The scheme was launched as a 100 per cent centrally sponsored scheme on 1 April 2000 to provide food security to those senior citizens who, though eligible for old age pension under the National Old Age Pension Scheme, are not getting it. Under the scheme, food grain are provided free of cost.
Valmiki Ambedkar Awas Yojana Launched on 2 December 2001, the scheme sought to provide shelter to the urban slum dwellers below the poverty line by facilitating construction and upgradation of the dwelling units. Nirmal Bharat Abhiyan, another component of the scheme, provides a healthy and enabling urban environment through community toilets. The scheme is financed on 50:50 basis by the central and the state governments, subject to a ceiling on the amount spent on dwelling units and community toilets.
Poverty Alleviation Programmes—A Brief Overall Assessment
From the plan documents relating to the anti-poverty programmes, the following broad guiding principles can be identified:
- Creation of scope for employment.
- Raising the productive assets the poor already have.
- Transfer of assets to those who do not have any and then raising their productivity so that they yield incomes that place the beneficiaries above the poverty line.
- The eradication of poverty must mean qualitatively more than simply upliftment of income levels of the poor beyond the poverty line.
The main problem in grappling with poverty has been a distinct organizational failure in terms of the implementation of the programmes. Administrative as well as political effort has to be sufficiently strong to contain the complex problem of poverty.
In spite of the difficulties and the criticisms of the Poverty Alleviation Programmes in the Plan periods, the long-term trend remains positive: ‘The anti-poverty programmes…played an important role in reducing both under-employment and poverty. Not only do the statistical estimates indicate reduction, but field studies in areas affected by drought and scarcity conditions also provide convincing evidence of the beneficial impact of anti-poverty programmes’.19
POVERTY REDUCTION: ACHIEVEMENTS AND GAPS
The overall reduction of poverty, in terms of the percentage of persons below the poverty line or the head count ratio (HCR), has shown a significant downward trend over time (Table 7.1). Three distinct periods in the history of direct interventions for the reduction of poverty that have been a subject of frequent comment are (a) from 1950s to mid-1970s, (b) mid-1970s to the end of 1980s and (c) the 1990s. The following seems to be the generally agreed conclusion: ‘There was no long-term time-trend in poverty from 1950–51 to 1973–74, but…there was thereafter a sharp decline in poverty till 1986–87. After 1986–87, the decline continued at a slower pace till 198990, when it was reversed, with a particularly sharp increase in poverty in 1992. Poverty declined again in 1993–94…’20 (Figure 7.1 shows these broad trends). The study goes on to observe that ‘the trend in rural poverty shows a very close similarity with trends in agricultural wages’. The trend is also related to markedly increased government expenditure.
Population below the poverty line, India, 1951–2000
- Figures up to 1997:
- Datt, G. 1997. Poverty in India and Indian States: An Update. International Food Policy Research Institute, Washington DC. Food Consumption and Nutrition Division. Discussion Paper # 47. http://www.ifpri.org/divs/fcnd/dp/papers/dp47.pdf. Table 1: Poverty in India, 1951–1994.
- Datt, G. 1999. Has poverty in India declined during the post reform period? Economic and Political Weekly. XXXIV (50): 3516–3518. Table 1: Mean consumption, poverty and inequality in India, 1993–1997 (p. 3517).
- Figures for 1999–2000:
- Planning Commission, in Economic Survey, 2001–2002. Chapter 10: Social Sector. Table 10.4: Estimates of poverty. http://indiabudget.nic.in/es2001-02/social.htm
- Figures for 1999–2000 are not strictly comparable with the figures for the earlier years due to a modification of methodology in the 55th round of the NSS.
On the impact of the liberalization policy on poverty, the trends are inconclusive; ‘the post reform trends in poverty do not suggest either an unambiguous improvement or an unambiguous worsening. They do suggest, however, that the initial impact of the stabilization/structural adjustment package was adverse, that this impinged particularly on the rural sector, with less impact on the urban sector, and that there was some general reversal of the adverse trend subsequently’.21
Head Count Ratios (HCRs), India, 1952–1997. Source: Table 7.1 of this book.
Note: The time intervals are not strictly comparable, but nonetheless, the graph shows the broad trends.
Based on both HCRs and severity indices, one analyst reports that the mid-1980s was a watershed in the improvement in living standards.22 He argues also that while poverty reduction in urban areas continued into the 1990s, in rural areas, it ‘was choked off by the lack of rural growth’.23 A more recent study, which too provides ground for concern, compares NSS data for 1973–1974 with those for 1999–2000, and finds that for poverty line households, the proportion spent on non-food items had gone up. It is argued, in this context, that expenditures on non-food items like health had become more burdensome. There are indications, on the other hand, that the shortfall of calorie intake of the poverty line households, could be due to a shift in consumption patterns towards better quality food, and are hence not necessarily indicative of deteriorating nutritional status.24
The near stagnation of the rural mean consumption, as shown by NSS data, was however ‘at variance with significant positive rates of growth in per capita income over the 1990s reported in the National Accounts Statistics (NAS)’.25 Sen and Himanshu, using NSS data, on the other hand, find that poverty decline in the reform era (1993–1994 to 1999–2000) fell at most by 3 percentage points. Other researchers find divergences between NSS-based poverty estimates and those based on MISH—the Market Information Survey of Households of the NCAER (National Council of Applied Economic Research). The authors make out a case for the validity of the MISH-based estimates, which suggest a marked decline in the poverty ratio in the reform era (whereas the NSS indicates stagnation).26 Analysts report too on varying estimates and interpretations.27 Clearly, the data on poverty on which we draw needs to be viewed with considerable caution.
We see that another significant aspect of poverty in India is the rural-urban gap (Figure 7.1). The ‘poor’ are clearly concentrated in rural areas. Here, there is an even higher concentration among rural labour, especially casual labour, female-headed households, and SCs and STs.28 Rural-urban gaps in poverty are wider in the states of West Bengal, Maharashtra, Assam, Orissa and Himachal Pradesh and much narrower in Bihar, Gujarat, Haryana, Karnataka, Kerala, Madhya Pradesh and Rajasthan.29 In the rural sector, the concentration of poor is higher in Bihar, Orissa, West Bengal, Maharashtra and Assam. (These are states that have ‘a high concentration of tribal groups’).
Inter-state variations are quite strong, as can be seen from Table 7.2.30 We see how the states of Bihar, Orissa and Madhya Pradesh have the worst track record. Not only are the inter-state variations striking; there are variations within the states as well. Thus, in 1974–1975, in the 18 rural districts of Karnataka, one of the better-performing states, the HCR varied from 67.0 per cent in Gulbarga and 66.4 per cent in Belgaum to 35 per cent in Raichur.31
While states like Andhra Pradesh, West Bengal and Kerala have taken large steps forward in poverty reduction (from 1973–1974 to 1993–1994), the progress of states like Bihar, Haryana, Assam and Uttar Pradesh has been relatively poor (Figure 7.2). The greatest reductions of poverty have occurred in those very states whose poverty levels were low, that is, states like Kerala, Andhra Pradesh and Gujarat. However, West Bengal, with a relatively high poverty level, seems to have a relatively good record of poverty reduction (Table 7.2 and Figure 7.2).
Head count ratio, states of India, 1973–1974 to 1993–1994
Source: Planning Commission. Cited in Economic Survey, 2001–2002. Chapter 10: Social Sector. Table 10.5: Poverty ratio at the state level. http://indiabudget.nic.in/es2001-02/chapt2002/chap102.pdf.
Change in head count ratios, states of India, 1973/1974–1993/1994. Source: Table 7.2 of this book.
We see also that the states which registered commendable progress, notably Kerala, Andhra Pradesh and West Bengal, also saw large inroads into rural poverty. Of the three leaders, Kerala registered considerable decline in its urban poverty as well.
So far, we have looked at the evidence from NSS data up to 1993–1994. While more recent data from the NSS are also available (for 1999–2000), these are not comparable with the data for the earlier period, due to differences in the methodology of data collection32 (Deaton 2005: 240). The data for 1999–2000 (Table 7.3) do however reveal striking inter-state disparities, as can be seen in Figure 7.3. We have seen similar contrasts for 1993–1994. The two are not comparable, of course, in terms of the levels of poverty at a given point of time, but it is nonetheless noteworthy that the ranking of states shows considerable similarity. Thus, states like Bihar, Orissa, Madhya Pradesh, Assam and Uttar Pradesh have far higher HCRs as compared to the south Indian states, as also, states like Punjab and Haryana. The basic pattern of difference thus appears to have persisted over time.
Head count ratio, states of India, 1999–2000
Source: Economic Survey, 2001–2002, Government of India, Chapter 10: Social Sector, Table 10.5: Poverty ratio at the state level. http://indiabudget.nic.in/es2001-02/chapt2002/chap102.pdf
Head count ratios, states of India, 1999–2000. Source: Economic Survey, 2001–2002,. Government of India.
The Human Poverty Index (HPI) is based on a more comprehensive definition of poverty, one linked to ‘deprivation in health, knowledge, and provisioning from both public as well as private sources’.33 It can be seen from the HPI scores data that ‘among the three dimensions, the highest deprivation at an all-India level as well as for the fourteen individual states (the only exception being Punjab) is observed in the case of provisioning, with knowledge following closely. Health deprivation in terms of probability of dying before the age of 40 is found to be lower’.34
HPIs have been calculated also as composite indices of (a) poverty below the poverty line, (b) proportion of population without access to safe drinking water/sanitation/electricity, (c) medical attention at birth/vaccination, and proportion living in kutcha houses; (d) proportion of illiterate population and children not enrolled in school; and (e) proportion of population not expected to survive beyond the age of 40.35 As in the case of HCRs, the indices show wide state-level variations. It is notable also that, when we consider rural poverty, there is a fair degree of correspondence between the ranking of states by HCRs and HPIs, even though the HPIs are based on a broader range of poverty-related criteria. In Bihar, Orissa, Assam, Uttar Pradesh, West Bengal, Haryana and Delhi, the difference in ranking are nil or marginal. There are however serious differences in ranking, with respect to other states. Thus, as per the HPI, Maharashtra has a very high incidence of poverty. As opposed to this, the HCR ranks Rajasthan as relatively low in terms of poverty incidence. Secondly, the ranking of Andhra Pradesh is also higher in terms of the HPI as against the HCR (Table 7.4). Leaving out the extreme cases, we find that the two different rankings of poverty are in general agreement on which States are closer to the higher end of the poverty spectrum, and which are closer to the lower end.
As expected also, HPIs are inversely related to Human Development Indices, or HDIs. Thus, states like Bihar, Orissa, Madhya Pradesh, Uttar Pradesh and Rajasthan, which have a high HPI ranking, ‘figured at the bottom on the HDI ranking’.36 A weak but positive relationship between state domestic product (SDP) and HDI was also found. Thus, higher-income states like Punjab, Maharashtra and Tamil Nadu had better HDIs. The relationship, however, is not an iron-clad one. Thus, ‘Kerala, a middle-income state, outperformed them’.37
Difference in ranking of states by head count ratio (HCR) and by human poverty index (HPI), 1991/1993–1994
Ranking based on
- Head Count Ratios for 1993–1994 from Planning Commission. Cited in Economic Survey, 2001–2002. Chapter 10: Social Sector. Table 10.5: Poverty ratio at the state level. http://indiabudget.nic.in/es2001-02/chapt2002/chap102.pdf
- Human Poverty Indices for 1991 from Planning Commission, Government of India. 2002. National Human Development Report 2001 (New Delhi: Oxford University Press, 2001). Table 1.4: Human Poverty Index 1991.
POVERTY AND PUBLIC POLICY
Three relatively recent developments in the policy sphere in India deserve special focus, namely (a) a new thrust to the PDS, (b) the Right to Information Act (RTI), which provides a mechanism for the poor and underprivileged to ascertain whether development funds meant for their benefit are actually spent and not siphoned away and (c) the National Rural Employment Guarantee Act (NREGA), which, by ensuring guaranteed employment, as a matter of right, provides a legal basis to livelihood security for the poor. We now take a closer look at these new frontiers, profile the stumbling blocks, and highlight the promise.
On the issue of provisioning, the PDS is the main strategy to look after food security. The objectives of the system are (a) price stabilization, through buffer stock operations (releasing food grains into the market when prices are high, and buying up surpluses when prices fall), (b) price support to farmers and (c) distribution of food grain at subsidized prices to the poor, and from surplus to deficit regions.38 Introduced in the 1960s in the context of a shortage of food and the need for rationing, the PDS was continued in the 1970s, and came to be seen mainly as a mechanism of price stabilization through buffer stock operations.
Currently, the PDS has come in for criticism on account of the huge surplus of food grain it has accumulated. To hold these stocks in the godowns of the Food Corporation of India (FCI), the central government spends more than what it does on agriculture, rural development, and flood control taken together.39 Acknowledging that ‘the buffer stocks in the country are far in excess of requirements’,40 the Tenth Plan document identifies two factors that have contributed to the enormous food grain surplus. One is the decline in cereal consumption in favour of a more diversified diet, in which items like milk, meat, vegetables and fruits find a greater place, a pattern that is ‘also discernable among the poorest 25 per cent of the population’.41 The second factor that has been identified is ‘the tendency of successive governments to fix minimum support prices (MSP) for paddy and wheat in excess of the levels prescribed by the Commission for Agricultural Costs and Prices (CACP).42 According to one estimate, this has led to additional purchases of 12.8 million tonnes of wheat and 3.4 million tonnes of rice.43
The MSP, or minimum support price, the Tenth Plan document notes, served the country well in the 1980s and the 1990s. By increasing the profitability of wheat and rice when the Green Revolution was under way, it had the effect of diverting farm lands to the growing of these crops, which helped build up food grain surpluses with the FCI. However, there is a need to now rethink the policy, the plan document observes.44 It goes on to suggest that the FCI should not aim to buy all that farmers offer for sale, but instead, should confine itself to an optimal buffer stock so as to ensure stability of food grain prices.45 A stable price line is all the more important, it adds, because the BPL households meet only a limited part of their food needs through the PDS; for the rest, they have to rely on private traders.46
In its buffer stock operations, the FCI should also enter the international market, to import when stocks are low, and export when stocks are in surplus. Farmers and traders too should be free to enter the international market, and customs duty reform should be appropriately defined.47 A cautionary note is however necessary here, since reliance on external trade can be hazardous. Countries of the West currently subsidize grain production, but may increase prices if they get a monopoly of world trade. Thus, the nation cannot afford to abandon food grains sufficiency. Moreover, planning for the long run—two decades hence, should take cognizance of the need to tap surpluses in states with production potential in central and eastern India. At the same time, ensuring stable prices through the MSP must continue to be an important plank of the food security strategy in times to come.48
The Tenth Plan document envisages a key role for private trade in food grain within the country as well, in matters of storage, processing and distribution of food grain. Consequently, the Plan document favours removal of restrictions on movements from surplus producing states to deficit states. The provisions of the Essential Commodities Act of 1955 is, in this context, seen as ‘a source of stifling controls’, and the government's Removal of Licensing Requirements, Stock Limits and Movement Restrictions on Specified Foodstuffs Order, 2002 a knight in shining armour.49 Private parties should also be involved in building up needed infrastructure like bulk handling facilities, market infrastructure, roads, etc.50 Other factors identified as critical to improvement of delivery mechanisms include : use of food stamps and food credit cards as means of setting up a leakage-proof system, and decentralised operations, with the state governments entering into the field.51
One of the major objectives of the food grains policy, as noted earlier, is making food grains available to the poor at subsidized prices. In seeking to promote that goal, the government, with effect from June 1997, introduced the TPDS, under which the poor and vulnerable sections of society (in rural areas, landless agricultural labourers, marginal farmers, etc., and in urban areas, slum dwellers and daily wage earners—porters, rickshaw pullers, pavement vendors, etc.) are provided food grain at subsidized prices (10 kg of food per month per family). It was expected that 60 million poor families would benefit. With effect from 1 April 2000, the allocation to BPL families was increased to 20 kg per month at 50 per cent of the economic cost. APL (above poverty line) households, under this dispensation, had to pay the full economic cost.52 From July 2001, the allocation for BPL families was increased to 25 kg per month at 48 per cent of the economic cost (Rs 4.15 per kg of wheat, and Rs 5.65 per kg of rice). For APL households, grain was to be supplied at 70 per cent of the economic cost. Apart from this, 25 kg per month were to be provided to the poorest of poor families under the Antodaya Anna Yojana, at the rate of Rs 2 per kg of wheat and Rs 3 per kg of rice.53
Supplying food grains at subsidised cost is of course only a precondition for food security, since the capacity of the poor to purchase food is equally important. Recognizing this, the Plan document indicates that the PDS is expected to fulfil the first goal, while employment generation programmes are required to cater to the second.54 The document also makes out a case for special plans to synchronize both approaches in isolated and remote areas that are beyond the reach of the PDS, such as tribal and forest area. The objective is to set up grain banks here, from which grain can be borrowed. Food for work programmes should also be implemented in such regions, so as to ensure repayment of borrowed grain. The Madhya Pradesh government has proposed such schemes to develop degraded land. The grain banks to be set up in these regions would be managed by women-run committees called anaj samitis.55
TPDS should be restricted to BPL households, the plan document emphasizes. For APL households, who have the ability to pay, the objective should be only to provide grains at a stable price through buffer stock operations. However, in the short run, to divest itself of huge buffer stock, the document cautiously argues that APL households too be provided subsidized grains. This, it suggests, has been a tried and tested route to dispose of excess stock with the FCI. Thus, on 23 March 2002, the issue price for APL families was reduced by Rs 100 per quintal for a period of 9 months and food grain supply limit was increased to 35 kg per month for all categories. Subsequently, the off take of food grains increased, from 18.46 lakh tonnes and 9.87 lakh tonnes for rice and wheat in April and June 2001, to 23.54 lakh tonnes and 16.09 lakh tonnes, respectively, for the corresponding period in 2002.56
One study assessing the impact of the PDS on poverty reduction, drawing on data from the 55th round of the NSS (1999–2000), suggests that ‘the PDS plays a significant role as an anti-poverty programme in the calorie poor southern states such as Andhra Pradesh, Kerala and Tamil Nadu but…(is) less significant in the relatively calorie affluent states such as Punjab, Rajasthan in the north and Bihar in the East’.57 Critiquing the PDS, another author argues that state procurement generates more purchasing power in the surplus producing districts ‘and little in the deficit/consuming districts’. Besides, the type of food grains sent to deficit areas are not necessarily the variety preferred by the poorer households. Moreover, adequate stocks and mechanisms in place to distribute food are by themselves not sufficient to ensure food security; there can be delays in the despatch and arrival of food grains, which is a serious matter, for ‘Stomachs can brook no delay’.58
Access to food by the poorer households depends on three ‘vital conditions’—purchasing power, local or proximate production to ensure assured access, and availability of stock of the type preferred by the poorer households. The local or proximate production of food grain can satisfy all these conditions. Not only can it circumvent deficiencies in the transport and timely arrival of food grain, there will be a greater likelihood of the production pattern conforming to the local consumption preferences, due to the expansion of employment and purchasing power of the poorer sections. There is thus a case for strengthening the role of the local community in ensuring food security, and for providing greater scope to Panchayati Raj.59
THE RIGHT TO INFORMATION ACT
India's Right to Information (RTI) Act was the culmination of a long and arduous campaign to ensure that governmental funds for development were actually spent on the poor, for whom they were meant, and not siphoned off by corrupt officials. The struggle was spearheaded by the MKSS—the Mazdoor Kisan Shakti Sangathan, a grass-roots organization operating in Rajasthan's Rajsamand district. In the late 1980s and 1990s, MKSS actively engaged in livelihood issues such as underpayment of wages by officials who billed the state government the entire sum. To ensure that workers got their full wages, there was a need for information on government schemes, which could be matched against the testimony of workers on how much they were actually paid. Also salient was the issue of ensuring availability of essential items to the poor through the PDS. The main problem was that items meant to reach the poor at subsided rates were being siphoned off to the open market, and sold for private gain. PDS stocks hence got depleted. As part of the cover up, bogus names were listed in sales registers, or inflated amounts were shown against genuine ration card holders. To expose the fraud, there was a need for official documentation on how much stock each ration shop received from the civil supplies department of the government, as well as the names of the ration card holders and the quantities of the commodities they supposedly purchased.60
To uncover malfeasance, the MKSS held a series of jan sunwais, or public hearings, at which numerous skeletons tumbled out of the closet. Fraud was uncovered—of people who were listed as recipients of government programmes but never received the benefits, of sums given to contractors for works that were never executed. The cross-checking of government documents in public, the modus operandi of the jan sunvais, stoked the fires of protest and resistance. Three salient facets of the forces unleashed by this process are worthy of note. Firstly, corruption as an obstacle to resource delivery to the poor got to be seen as a salient feature of the right to information. Secondly, the right to information, which, in the 1990s, was interpreted as the right to free expression, came to be viewed in the context of the Constitution of India's right to life and livelihood. Thirdly, the collective participation in securing access to information, which characterized the public hearings of the MKSS, highlights the participatory colouring that the right to information has inherited in the Indian context.61
Since accessing government records often proved difficult, the MKSS and its allies sought a legal basis for doing so. A train of events was set in motion in 1995 when, as a concession to public sentiment, the Rajasthan Chief Minister stated on the floor of the state legislature that the citizens would be given the right to photocopy documents related to development works. What was actually awarded, after a year's delay, was the right of inspection only, not the right to photocopy. ‘This made it next to useless for social audits, since certified copies of documents are needed for use as evidence when registering prima facie cases of corruption’.62 A 52-day protest ensued, in May-June 1997, at the end of which the demonstrators were informed that a government order had been issued 6 months earlier, allowing photocopy of government documents, but only those pertaining to development works under the local government bodies. The PDS, which was a joint state and local government operation, was hence excluded. Furthermore, there was no provision for punitive measures against officials who failed to provide information. As a consequence, there was a lot of foot dragging by officials, and even intimidation and harassment of MKSS activists. Some officials were cooperative but others colluded with elected representatives to sweep the dirt under the rug.63
Other organizations joined the MKSS in the fray, in the struggle to ensure a legal basis for the right to information and seek reform of the Official Secrets Act of 1923, which covered all government documents. In 1996, the Press Council of India, senior faculty of the National Academy of Administration and other interest groups joined hands with the MKSS to establish the National Campaign for People's Right to Information.64 ‘Despite bureaucratic subterfuge and resistance from various quarters, vigilance and advocacy groups helped ensure that a strong right to information bill was passed by the Indian Parliament in June 2005’.65 The Act came into effect on 12 October of the same year.
Right to information under the Act is the right to any information under the control of a public authority, and includes the right to certified copies of documents. The Act stipulates obligations on the part of public authorities,66 provides for Public Information Officers,67 and specifies that a request for information be responded to ‘as expeditiously as possible, and in any case within thirty days of the receipt of the request…’.68 Certain categories of information, for instance, information that will compromise national security, or may constitute contempt of court, etc., are exempted from the purview of the act.69 Details on the constitution of a Central Information Commission and State Information Commissions, its powers and functions, terms of service of appointees, penalties for not satisfactorily discharging duties, etc. are also set forth.70
The Act, now in force ‘was hailed, almost universally, as a landmark piece of legislation…[It was] considered one of the most progressive RTI laws in the world, with several provisions worthy of emulation’. Citizens groups saw it as ‘a ray of hope to fight corruption, inefficiency, and the arbitrary use of power in an otherwise dark scenario’. However, some of the amendments to the Act proposed by the Union Cabinet, if implemented, would ‘crucially damage the scope and power of the Act’. The ‘most critical’ of these proposed amendments is the one which bars access to ‘file notings’, that is, the notes made by government officials on a file, which informs the decision that is eventually taken. If these notings are placed outside the purview of the Act, then ‘as ordinary citizens, we will not have access to the reasons for the decisions, many of them irreversible, that affect our lives. The paper trail, vital to establish a chain of transparency and accountability, will now be invisible’.71 Another analyst who hits the nail on the head succinctly notes: ‘If merely the final decision is conveyed, the rationale and logic behind the decision may not become apparent. Any unfair influence or collateral considerations in decision-making will not be known. The reasons why a more logical point has been overruled will never be known’.72
Arguing the case for the exclusion of file notings from the RTI, President A. P. J. Kalam expressed the concern that if the notings are put in the public domain, it ‘will harm the process of decision making, as officials would be more cautious or even refrain from rendering objective, frank and written advice on file’. This view, believed to have been endorsed by the Prime Minister, and put forth also by the Union Public Service Commission,73 is however specious. As has been rightly argued: ‘Just as judicial review has been a deterrent against arbitrary decision making, the prospect of transparency and public gaze will necessarily compel decision-making authorities to record relevant reasons and to ensure that decisions are fair and appear to be fair’.74 Another side to the issue is that the bureaucracy could circumvent the RTI by not putting down their views in writing or by maintaining ‘shadow’ files. Magsaysay award winner Aruna Roy responds: ‘Any government servant who will not put down his opinion must be sent home. It is a criminal offence to mislead the public. The people are sovereign’.75
Following a number of representations opposing the proposed exclusion of file notings from the purview of the RTI, the government has decided not to bring in the amendments, at least in the current (2006 monsoon) session of the Parliament. The Congress President ‘is believed to have advised the Government that there should be a wider consultation among the stakeholders before the controversy over the notings got sorted out’.76 The shelving of the act, however, still leaves RTI activists with a feeling of disquiet, for they ‘apprehend a fresh offensive from the Government, sooner rather than later’.77 As expected, the ‘empire’ did strike back, by seeking to render the Central Information Commission (CIC), the appellate body under the act, a toothless tiger.78 Thus, the CIC has not been able to establish its jurisdiction over the DoPT (Department of Personnel and Training), Ministry of Personnel and Public Grievances, supposedly the nodal agency for facilitating access to information under the act, but ‘in practice, the most reluctant to parcel out information’.79 In as many as 40 cases over a period of some seven months, RTI claimants have been refused file notings by such government bodies as the Ministry of Railways, Ministry of Urban Development, Ministry of Health and Family Welfare, Ministry of Company Affairs, Department of Company Affairs, Central Board of Excise and Customs, and even the DoPT itself. Non-compliance with the provisions of the Act was justified on the ground that the DoPT, as per information on its Web site, excludes file notings from the Act's purview. While the decision of the CIC is final and binding as per Section 19(7) of the Act, the DoPT has refused to purge its Web site.80 Indeed, there are other indications that the government appears to be dragging its feet. Thus, its claim that file notings were never intended to be included under the heading ‘information’ in Section 2(f) of the RTI Act.81 The silver lining is that, as per judicial interpretation, the Government's supposed leeway in this matter can be blocked by the Constitution of India itself. The right to information, according to this view, derives fundamentally from Article 19(1) (a) of the Constitution, which guarantees the citizens the freedom of speech and expression, subject of course, to the restrictions stated in article 19(2). This right in turn implies the right to information, since: ‘In order to exercise the freedom of speech and expression effectively, you need an informed public opinion’.82 The RTI Act is, in this context, merely ‘an instrument that lays down the statutory procedure…’. Consequently, ‘Any blanket ban on disclosure of opinions, advices, and notings on the files could run foul of the constitutional guarantees’.83
NATIONAL RURAL EMPLOYMENT GUARANTEE ACT (NREGA)
NREGA, 2005, envisaged as an instrument to promote livelihood security, requires that ‘every state government shall, within six months from the date of commencement of this Act, by notification, make a Scheme, for providing not less than one hundred days of guaranteed employment in a financial year to every household in the rural areas covered under the Scheme and whose members, by application, volunteer to do unskilled manual work subject to the conditions laid down by or under this Act and in the Scheme’.84 If no such scheme is notified, then, until such time as it is, ‘the Action Plan or Perspective Plan for the SGRY or the National Food for Work Programme (NFFWP) whichever is in force in the concerned area immediately before such notification shall be deemed to be the action plan for the Scheme for the purposes of this Act’.85 The Act extends to the whole of India, except the state of Jammu and Kashmir.86
Wages under the Act, to be disbursed on a weekly basis or not later than a fortnight, while not governed by the Minimum Wages Act of 1948, cannot be lower than Rs 60 per day. Until the wages to be paid are determined by the central government, however, they will be fixed as per the provisions of the Minimum Wages Act of 1948 for agricultural labourers. If an applicant is not provided employment within 15 days of having applied for it, he or she will be entitled to an unemployment allowance, which should be at least a fourth of the wage rate in the first 30 days of the financial year and no less than half the wage rate for the remaining period.87 To mobilize monies, the Act stipulates the setting up of a National Employment Guarantee Fund and State Employment Guarantee Funds.88
Conditions of work are also stipulated. These include, ex gratia payment to the legal heirs of the deceased or disabled worker, or to the person accompanying a child who suffers personal injury or dies as a result of an accident on the work site; provision of safe drinking water; shade for children of workers to rest in; provision of a medical box and treatment of minor injuries; free medical treatment to workers who suffer an injury during the course of work in the scheme; and free medical treatment of children of workers who suffer injury while accompanying their parent to the worksite.89 In case hospitalization of an injured worker is necessary, accommodation, treatment and medicines have to be provided by the state government, in addition to a daily allowance of not less than half the wage rate.90
Monitoring and implementation are to be done by a Central Employment Guarantee Council and State Councils. However, it is the Panchayati Raj bodies that are to be the ‘principal authorities’ for planning and implementation. Programme Officers of rank not below that of a Block Development Officer will carry out the administrative work. Grievance redressal mechanisms are to be set in place at the block and district levels. Notably, the Act provides a space for the Gram Sabha too; ‘The Gram Panchayat shall be responsible for identification of the projects in the Gram Panchayat area to be taken up under a Scheme as per the recommendations of the Gram Sabha and the Ward Sabhas and for executing and supervising such works’. Also, the Gram Sabha will monitor and carry out social audits of the projects that are implemented.91 Not only that, all records will be open to public scrutiny, after a suitable fee is paid.92
Notwithstanding the many progressive features of the legislation, the NREGA has been critiqued on a number of counts. Firstly, it is a guarantee of not less than 100 days of employment to households, not to every needy individual.93 Secondly, the limit of 100 days of employment too is questionable. The criterion that employment be provided for not less than 100 days of course leaves it open to the state and central governments to go beyond this limit, but if the right to employment is understood in terms of the livelihood need of people in distress, then the criteria for employment should be in relation to perceived need. For instance, in drought years, or in regions affected by drought, the need may be relatively greater.94
Another salient critique, based on observation of the programme launched under the Act in 200 districts of India in February 2006, focuses on the situation on the ground with respect to the wages paid to applicants for work done under the Act. Since Independence, in rural works programmes, wages have been paid as per the quantum of work that is done. How much work qualifies for how much wage is, in turn, determined by the SoR, or schedule of rates. So, if a worker works relatively slowly, as compared to the ‘average worker’, his wage entitlement will be below the statutory minimum wage. This can happen, for instance, when excavation work is carried out in areas where, due to the relative hardness of the geological strata, the work is relatively more difficult. The SoR is not sophisticated enough to capture such differences. Climatic conditions can also matter; thus, in peak summer months, work slows down, but, again, climatic differences are not factored into the SoR. The SoR is problematic also because it assumes that the ‘average worker’ is healthy, which is not necessarily the case. If the worker is not able to produce the quantum of work that qualifies for the minimum wage, then the contractor will either have to pay a below the minimum wage or, extend the working day, which again raises issues of exploitation of the poor and vulnerable.95
The NREGA does address issues thrown up by the SoR, specifying that ‘The schedule of rates of wages for unskilled labourers shall be so fixed that a person working for seven hours would normally earn a wage equal to the wage rate’.96 How the SoR rates are arrived at is, however, ‘entirely shrouded in mystery’. The need for transparency is paramount, as: ‘The SoR never comes out in the open about how rates for different works are arrived at’. Worse still, it is a process that…is a highly centralised departmental affair’. Thus, there is a need to bring the SoR out into the open, and to rationalize it through deliberations at the local level, in consultation with panchayats representatives, local professionals, government officials, engineers, etc.97
Let us now take a look at a concrete example of how work gets to be measured under the SoR. We take a look at some evidence based on a survey of two districts in Jharkhand-Palamu and Latehar, where the NREGA has been in force since 2 February 2006. Under the chauka system of wage payment prevalent in these areas, to earn the daily minimum wage of Rs 73, a worker has to dig a chauka (pit) of 100 cubic feet. However, it ‘typically takes more than a day for an average worker to complete the specified task’. This consequently is in violation of Section 8 of Schedule I of the NREGA, which, as we have seen, stipulates that the daily work load should be such as that a worker can do it in 7 hours and earn the minimum wage. Moreover, the chauka digger in the study area is required to transport the dug up earth a distance away, for which no payment is made, even though this type of ‘lift and lead’ work does feature in the SoR. A related issue here is of worker's awareness of their entitlements. The SoR specifications vis-à-vis type of soil, depth, etc. not understood by workers, and hence they are not in a position to ascertain whether they have been paid correctly. Not only that, there is no proper system for SoR related work assessment either.98
While one survey by the Centre for the Study of Developing Societies shows that ‘barely half of all adults in NREGA districts’ know about the Act, another study, carried out in four states by the Centre for Budget and Governance Accountability, showed that levels of awareness ranged from 29 per cent in Jharkhand to 98 per cent in Andhra Pradesh. Budgetary allocations for the 200 NREGA districts, as per the National Advisory Council estimate, were less than half of what was required, but in some districts, like Dungarpur in Rajasthan, success has been phenomenal; in April 2006, notwithstanding some lapses (delayed wages and non-payment of the minimum wage) ‘most rural households in the district had a job card, and about half of them had a member employed under the NREGA. New water harvesting structures were springing up everywhere…muster rolls were available at the worksites, and extensive checks revealed that few of them had been fudged’. Another success story, of Anantpur district in Andhra Pradesh, is also noteworthy. Also providing grounds for optimism are indications of political parties seeking to woo voters on NREGA-related issues.99
Other evidences of the working of the NREGA show a variegated picture. Data from the Ministry of Rural Development show impressive achievements of the National Rural Employment Guarantee Scheme (NREGS) in states like Rajasthan and Madhya Pradesh, where 85 and 68 man-days per household, respectively, were generated in 2006–2007, as against the target of at least 100 man-days annually. In Chattisgarh and Orissa, more than 50 man-days per household were generated annually, while in states like Bihar and Jharkhand, and also in Andhra Pradesh and Uttar Pradesh, the number of man-days per household generated under the NREGS in 2006–2007 was in the range of 30–40. West Bengal was the worst performer, generating a mere 14 man-days of employment per household in 2006–2007.100 Evidences from other sources too are pertinent, showing that the incidence of households registered under NREGA was strikingly dismal in West Bengal, while BIMARU regions like Madhya Pradesh and Jharkhand fared far better. Thus, as per a survey conducted by Participatory Research in Asia (PRIA), a mere 40% of the sampled households in West Bengal were registered under NREGA, which compares to the figures of 94.9% for Rajasthan, 97% for district Shivpuri, Madhya Pradesh, 75–85% for Jharkhand's Jamtara and Pakur districts, and 79% for district Rajnandgaon, Chattisgarh.101
Shockingly, in most districts of the PRIA sample, three fourths of the NREGA households reportedly earned less than the minimum wage.102 Creche facilities and medical aid at the worksite, which are required to be provided under NREGS, were extensively lacking, the PRIA survey also revealed, but here again, the showing was relatively better in some parts of the country as compared to others. Thus, the availability of crèche facilities was reported by all the households sampled in Banda and Mirzapur districts of Uttar Pradesh, by less than 5% in Madhya Pradesh, Jharkhand, Rajasthan and Gujarat, 14% in West Bengal, and by as many as 40% of the households in Muzzaffarpur district of Bihar. Similarly, availability of medical aid varied widely. At one end of the spectrum, as few as 0.2% of the households of Banda district reported availability of medical aid. In West Bengal, the availability of medical aid was reported by 33% of the sampled households, while at the other extreme, 40–50% did so in Rajasthan, Uttar Pradesh, Gujarat, Kerala and Sidhi district of Madhya Pradesh.103 Other shortcomings of NREGS have been brought out by a survey in western Orissa initiated by the G. B. Pant Social Sciences Institute and carried out by students of Delhi University in collaboration with local volunteers between the 3rd and 12th of October, 2007. The survey indicated that funds were being siphoned off by contractors through a process of improper and opaque documentation of work and wages paid in the labourer's ‘job cards’. Consequently, by fudging records on the job card, ‘contractors’ traditionally engaged in mobilized labour in the region were able to siphon off NREGS monies. Nonetheless, contractors are finding it difficult to function under the NREGS dispensation.104
Let us now turn to some of the more promising indications of the functioning of NREGS. A survey in the Surguja and Koriya districts of Chattisgarh found that as much as 96% of the wages alleged to have been paid to workers, as per the records in muster rolls, were in fact actually paid. This, in a region where, just 2 years earlier, massive discrepancies had been uncovered in the funds disbursement under the food for work programme.105 In another study, undertaken by NREGA Watch Tamil Nadu, a social audit of NREGS in 25 panchayats of Villipuram district, showed that the workers under NREGS did receive the daily minimum wage of Rs 80, which was paid promptly, within a week's time. It was found also that four fifths of the women in the work force, of whom many had been getting wages as low as Rs 30–40 per day, had found employment under NREGS. The audit also revealed a seamy underbelly, however. One of its facets was that work under the NREGA was supply, and not demand driven. Consequently, due to the relative scarcity of employment, work opportunities were rotated in different wards, as a form of rationing. The social audit stressed the need to identify a range of works that could be undertaken, to end the rationing.106
THE ROAD AHEAD
As we have seen, the deepening of democracy is critical if human development is to begin to fulfil its promise to the poor and the underprivileged of the land. In this context, the indications of stirrings and awakenings at the grass roots, and of people's challenges to an uncaring State, augur well for the road ahead.