Public employment programmes are now recognized as essential components of any development strategy. India’s National Rural Employment Guarantee Act (NREGA) that ensures 100 days of employment to the rural poor across the country is an example of the importance of such programmes for the agenda of inclusive growth.
However, despite the political and economic importance NREGA has generated, there are lack of studies on the working of public employment programmes. It was so till the National Sample Survey Organisation (NSSO) decided to include it as part of its survey of consumption expenditure since 2005-06. The most recent report on this—based on the 63rd round (2006-07)—has been released recently. It is also the first evaluation of public employment programmes since NREGA was enacted.
It is important here to mention two important caveats. First, the survey collected information on public employment programmes, which also included programmes other than NREGA. Since NREGA was applicable in only 200 districts at that time, the remaining districts were covered by other employment generation programmes. It can, therefore, not be treated as an evaluation of NREGA until the unit-level records are made available by NSSO. Moreover, since this was the first year of the implementation of NREGA, there is all the more reason not to use these estimates as an indicator of its working.
Secondly, unlike previous evaluations of employment generation programmes that are based on secondary data made available by the ministry of rural development, this analysis is based on information collected by actual workers. Needless to say, this is not only more reliable than ministry statistics, it also gives an idea of the actual reach of the programmes compared with official claims.
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Despite these caveats, one cannot avoid the inevitable comparison of estimates generated by NSSO with those that have been put together by the ministry of rural development. For any such comparison, I have relied on the much cited work by Jean Dreze and Christian Oldiges, which looked at statistics from the ministry of rural development regarding implementation of NREGA in 2006-07 (available at www.righttofoodindia.org).
Since the reference year is the same in both the studies, it is worthwhile to compare the two estimates. The NSSO estimates reported here are taken from the NSSO report No. 527 on consumption expenditure in 2006-07. The estimates of NREGA, based on the ministry of rural development data, is taken from Dreze and Oldiges.
According to NSSO, person days of employment generated under public employment programmes increased from 37 crore persondays in 2005-06 to 52 crore persondays in 2006-07. However, this increase was not equally shared by males and females, with male persondays employment generated increasing by 12 crore persondays, compared with only three crore additional female persondays of employment generated.
Moreover, this 40% increase in persondays of employment generated is still considerably lower than the ministry of rural development’s estimate of 90 crore persondays of employment generated through NREGA alone.
However, the estimate of person days of employment generated per person is fairly close to the estimate reported by Dreze and Oldiges using the ministry data for NREGA. Compared with 17 days of employment generated under NREGA per rural household, NSSO reports 19 days of employment generated per adult person. This again is higher than the 17 persondays per adult person reported in 2005-06.
The NSSO estimates also suggest that the share of women in total persondays generated is 29.5% in 2006-07, lower than the 40% share of women under NREGA reported by the ministry. Moreover, the NSSO estimates also suggest that the share of women in persondays of employment generated has come down marginally from 33.3% in 2005-06 to 29.5% in 2006-07.
The other improvement reported by NSSO is the increase in the number of job seekers in public employment programmes. Compared with the 12% of rural population that sought jobs under public employment programmes in 2005-06, 14% of population sought jobs under public employment programmes in 2006-07.
However, in both the years, the percentage of job seekers who actually got jobs was lower than those who sought them. As many as 59% of those who sought jobs under public employment programmes did not get it in 2005-06, compared with 57% in 2006-07.
Despite the increase in person days of employment generated under public employment programmes, the high number of job seekers who are rejected by the administrative machinery is clearly unacceptable. At the same time, it is also indicative of the high demand for such initiatives.
Among those who worked in the public employment programmes, there has also been a marginal increase in the wages received. Compared with Rs55 per day received by workers in public employment programmes in 2005-06, the wages received has increased to Rs61 in 2006-07.
Although this is still lower than the minimum wages in most states, these estimates are fairly close to the estimate reported by Dreze and Oldiges of Rs64 per day under NREGA. The NSSO reports also confirm the gender wage differential under public employment programmes is much lower than in private employment.
Finally, the total wage bill reported by NSSO for public employment programmes turns out to be Rs3,222 crore in 2006-07. Since the expenditure by the Union government on rural employment programmes was Rs12,870 crore in 2006-07, it implies a wage bill of Rs7,722 crore, with the assumption that 60% of the total expenditure was spent on wages.
It then follows that the actual amount received by those who worked on wage employment programmes received as much as 42% of the total spending on wage component of employment generation programmes.
This is definitely not a good indicator of the efficiency of the public employment programmes. However, it is definitely better than the previous guesstimates of only 15% of public money reaching the poor.
Himanshu is assistant professor at Jawaharlal Nehru University and visiting fellow at Centre de Sciences Humaines, New Delhi. Respond to this column at email@example.com