The Comptroller and Auditor General is an important constitutional functionary. His — all incumbents so far have been male — job is to let citizens know whether tax-payer’s money is being spent as per legislative intentions or whether funds are squandered fraudulently or otherwise. On the basis of a ‘draft’ CAG report, there is a rising chorus of demands that the National Rural Employment Guarantee Scheme be scrapped. Let’s have some perspective here. Why is there no CAG report on petroleum subsidies which are destroying public sector Navaratnas? After all, is Parliament not responsible for the financial health of PSUs? Given that our oil majors are listed, there is a serious case for a SEBI investigation as to whether the majority shareholder (the Government of India) is violating the rights and impoverishing the wealth of minority shareholders by holding on to prices that are destroying the viability of these companies. Is there a CAG report on how politically connected petrol dealers conspire to murder honest oil company executives who try to prevent adulteration and theft of petrol? The magnitude of the petrol/diesel/LPG subsidy (all appropriated by middle and upper classes) dwarfs the attempted payments to India ‘s poor. There have been hundreds of audit reports placed before Public Accounts Committees of Parliament and state legislatures stating that money is wasted or stolen by our notorious and incompetent Public Works Departments. No one is suggesting that PWDs be shut down. Otherwise, how would the contactor-politician-bureaucrat nexus survive? To return to the NREGS (the National Rural Employment Guarantee Scheme), no one argues that this is the best way to deal with poverty. It would be preferable to encourage labour-intensive growth (reform our labour laws that protect incumbent union leader sultans and discourage creation of new jobs), implement genuine land reform by giving clear title to peaceful possessors of land (not give tenancy protection which makes the market in land rigid and prone to litigation; not arbitrarily classify land as ‘agricultural’ or as ‘reserved for SCs/STs’, which only enables the corrupt and the well-connected to get them ‘converted’ and extract value), build roads (roads have many positive externalities to improve the wealth of the poor apart from being labour-intensive in themselves), give vouchers/subsidies directly to poor parents so that they can send their children to English-medium schools like their elite counterparts (acquiring the surest ticket out of their poverty trap), etc. But given that the Indian state is unlikely to do what is required to genuinely help the poor, the NREGS was and is conceived as admittedly a second order sub-optimal solution. But that is no reason to discard it while pursing an abstract best-case alternative kicked around from committee to committee in the miasmal corridors of Yojana Bhavan. The NREGS has many attractive features. First, it envisages wages for work, not doles. Wages confer dignity on our poorest fellow-citizens. Second, the wage rates are not set too high. If alternative productive private sector employment were to come up, applicants will automatically go in their search. Third, and most important, it has the capacity to create social assets — lakes, check-dams, reclaimed waste-lands with trees, toilets for schools, etc. By being gender-neutral, it is conducive to the liberation of the enormous reservoir of human capital in our female work force, currently condemned to undervalued, underpaid drudgery.Free India’s track record in dealing with mass poverty has been spotty at best. By abandoning the NREGS rather than trying to make it more efficient and effective, we run the risk of throwing the baby out with the bath-water. When we lost the 1962 war, we did not shut down the defence ministry. We gave the ministry more funds and sent it out on a mission to pursue efficiency. That is the kind of response we need when faced with the weaknesses in execution in the NREGS. The CAG’s draft report shows us that in state after state there are cases of false muster rolls, payments without signatures/thumb-prints, payments to unintended beneficiaries, siphoning of funds by powerful political functionaries, inflated payments to contractors, diversion of funds. Other reports indicate that NGOs are not exempt from corruption and some have emerged as the contractors of the new Raj! All these criticisms are valid and it is our obligation as citizens to confront them and deal with them. In this context, I view the CAG’s report as a success. How many schemes of other spendthrift ministries have been brought under public scrutiny so soon after launch? If despite these warning signals, if despite the best efforts of empowered groups using the Right to Information Act, if despite being given more time and better organisation, we make no progress, then and only then should we look to scrap the NREGS. Incidentally, the CAG says that many callous state governments have not even appointed an official to oversee the NREGS. Everyone is in a hurry appointing security staff for themselves and promoting their cronies to OSDs (officers on special duty, a hangover from the Raj, conveniently used by our incumbent socialists). But for an honest, efficient IAS officer to supervise NREGS in many states is not on the cards!One defect in the draft CAG report (hopefully will be corrected in subsequent reports) is the failure to look at outcomes. It is not enough to have good muster rolls and signatures. We need to check if assets are being created. I derive a tiny bit of satisfaction from the report of Sudha Narayanan of Stella Maris College, Chennai. At least in one village (Vengur) in Villupuram district, the NREGS has resulted in the creation of a pond which has eliminated water shortage for the inhabitants. As a country, we should have more Vengurs, more ponds and fewer thirsty people.Walking away from an imaginative attempt to deal with poverty alleviation is easy; we may have to do so if with the passage of time the NREGS proves incapable of improved efficiency. To walk away now would be a mistake. The writer is a student and observer of contemporary India jerry.rao@expressindia.com
