Digging a hole

Its right there in the Act. The National Rural Employment Guarantee Scheme,and the act which brought it into force...

Its right there in the Act. The National Rural Employment Guarantee Scheme,and the act which brought it into force,call for the creation of productive assets following that up with a description of what those are. Yes,the core competence of the act is expanding rural employment and acting as an automatic,counter-cyclical macroeconomic stabiliser in these difficult times,and the fact that some of the assets being created arent quite as useful as they could be has been much discussed in the past,and eventually dismissed as,in the end,not really the schemes main thrust.

All this might be true. But,now that the scheme has reached critical mass,and stories and data about its implementation are coming in from across the country,it might be time to revisit the state of debate. This newspaper on Thursday reported from Haryana; one of the first districts to benefit from the NREGS,Mahendergarh,seems to have discovered that the tangible benefits havent lasted: ponds that were dug arent full,and dont work as expected. According to villagers,their opinion on suitable projects was ignored.

So,what can we learn? From Mahendergarh,and from other stories,nationwide,we can take away the three things that might mean sub-optimal project choice. First,the original project options,usually from the local panchayats,suffer if they dont take a holistic view,or are captured politically. For example,in Mahendergarh,villages that already had ponds had authorities that demanded more anyway. Second,the panchayats are frequently without resources to aid their decision-making: they sometimes just dont know enough. And third,the final choice from the panchayats menu is done at the district level,and is far too dependent on whether the bureaucrat respects their opinion and feedback or not. Good results are in places where the district bureaucrats and the village politicians both do their job. In Jharkhands Pakur,an NREGS model district,agricultural production started up in vast,formerly barren swathes: and that was to the district administrations credit,as that area of the country doesnt have working panchayats. Conversely,the NREGS itself touts Panihari,in Haryanas Sirsa district,as a place where the panchayat ensured project choice worked because it managed well the politically vexed questions of internal transfers and compensation. Policy-watchers are taking note: one study finds that professional support at the panchayat level would cost little more than 6 per cent of the total budget. That might be worth it. Either way,the times come to extend the debate on the NREGS.