The state or the market?

The state or the market?
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First Published: Mon, Jun 29 2009. 09 48 PM IST
Updated: Mon, Jun 29 2009. 09 48 PM IST
There seem to be two divergent worlds. One thinks the private sector is a monster gobbling up the poor and the government is a do-gooder. The other believes strongly that the government is corrupt and inefficient, and market-based solutions are the best.
I attended a conference where the chief executive of a venture capital fund was narrating her experiences. It had invested in a company which provides healthcare for the poor in a unique way, with a strong business model. The government enters the same sector, and all business models are thrown to the wind as services are offered free.
The same week, I attended a talk by a visiting professor who was advocating educational vouchers for the poor so that students could make a choice of schools. A woman from the audience said privatization was not the panacea for the ills of the education system. Didn’t our parents go to government schools? The problem, she said, was with those who pay high fees for private schools, which commercializes the system of education and destroys government schools.
I belong to both worlds. I am a private sector person heading a government mission which trains rural and tribal youth for entry-level corporate jobs.
The muscle of the government machinery helps me set up low-cost, no-frill training centres in remote and interior areas, where social problems such as Naxalism exist. The budget comes from the government, which sees the rural and tribal youth gaining self-confidence, speaking English and sending money home from their McDonald’s or Hindustan Unilever job.
The private sector contributes generously in helping me set up new academies for the poor— such as the country’s first rural retail academy—and then comes to the campuses for recruitment.
The mothers of the youth and our alumni spread the word about the training programmes, leading to a bottom-up approach.
With three stakeholders—the government, companies and the poor—coming together, we have emerged as the largest jobs mission for the rural poor, training 200,000 youths and placing 70% of them in jobs.
The stumbling block to such collaborative communication is the cobweb of perceptions and attitudes. Companies think working with the government is a waste of time; the government thinks all companies are exploitative. And the rural poor are unaware of the benefits of partnerships.
The Employment Generation and Marketing Mission (EGMM) was chosen as the training partner for ADFC, HDFC Bank’s rural business process outsourcing firm, thanks to a senior bank official who had already recruited rural youth from our training centres. But there was tremendous scepticism among the business heads in Mumbai. Can a government organization deliver quality? How will they make the rural poor work-ready? The partnership results in 200% higher productivity compared with its urban counterparts, based on EGMM becoming the sole manpower agency for ADFC!
What is therefore needed is a facilitating mechanism such as EGMM which allows these different stakeholders to meet on a common platform.
For governments, the return on investment is high; the impact, quick. The companies receive trained manpower from a large rural labour pool. Company problems of attrition are addressed with this new hiring mechanism. And for the families of the poor, a shift takes place from erratic incomes to a steady money source month after month. Studies show that the extra money is used to retire high-cost debt, buy assets or help in educating a younger child.
The solution, as I see it, is P3— public, private and poor—partnering to create an inclusive society.
Meera Shenoy is executive director of the Employment Generation and Marketing Mission, rural development department, in the government of Andhra Pradesh. Comment at yourviews@livemint.com
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First Published: Mon, Jun 29 2009. 09 48 PM IST
More Topics: Education | Private sector | HDFC Bank | EGMM | Views |