Centre set for NREGA showdown

  • 26/08/2008

  • Asian Age (New Delhi)

NEW DELHI The Centre is preparing for a possible showdown with the states over its flagship programme National Rural Employment Guarantee Act (NREGA). The bone of contention between the two is arbitrary hike in the minimum wages by major states in the post NREGA regime, which is likely to put an additional burden on the Central exchequer by Rs 6,000 crores. Claiming that the states' unilateral approach in hiking the wages, when the Central kitty has to bear the maximum burden while implementing schemes under NREGA, sources in the government claimed since the trend is continuing unabated, the Centre is forced to work out a formula to arrest it. As part of the exercise, the Union rural development ministry has thrown open three options to choose between. The first is to fix the minimum wage at Rs 60 for jobs done under NREGA. The second is to amend the Constitution by putting the power of fixing minimum wages to the Concurrent List and the third is to issue a directive to states to consult centre before revising the wage. It is, however, reliably learnt that the UPA leadership has rejected the first two proposals on the basis for their being politically incorrect. "We are working on the third option and it is at the discussion level in the ministry. Once it is finalised, states would be invited for their consent,' the sources said. During last fiscal (200708), the Centre spent approximately Rs 10,000 crores in disbursing wages, which created jobs for about 141 crore man-days with an average minimum wages coming to Rs 66 only. "Keeping almost the same number of man-days this fiscal (2008-09), the estimated wage burden of the Centre is expected to come around Rs 16,000 crores,' the sources said. The states, which have hiked the minimum wages ranging from 50 to 100 per cent, include big states with high population density like Bihar, Andhra Pradesh, MP, Rajasthan and UP. Bihar jacked it up from Rs 61 to Rs 90. In AP, though the minimum wages Rs 80 has not been changed, the quantum of job has been reduced to half for the same work. Similarly, MP has hiked it to Rs 90 from previous Rs 57. Rajasthan also followed the suite by jacking up the minimum wage from Rs 58 to Rs 100. UP is one step ahead of others, as it hiked twice to take the minimum wage from Rs 58 to Rs 80 first and then to Rs 100.