Press Information Bureau

Government of India

Ministry of Finance

25-February-2011 12:20 IST

Upward Trend in Employment Continuously Observed Since July 2009 Suggested Improvements in Mgnregs:

Shifting to Permanent Asset Building and Infrastructure Development

As per the Economic Survey tabled in the Lok Sabha here today by Finance Minister Shri Pranab Mukherjee, on the employment front, the country has been able to withstand the adverse impact of the global crisis and generate employment since July 2009 as reported in the quarterly quick employment surveys conducted by the Labour Bureau. An upward trend in employment has been continuously observed since July 2009. During the quarter July to September, 2010, overall employment increased by 4.35 lakhs.

The Economic Survey states that during 2009-10, 5.26 crore households were provided employment under the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGS) as against more than 4.51 crore during 2008-09. During 2010-11, about 4.10 crore households have been provided employment till December 2010. The Survey states that under the scheme, maximum employment during 2009-10 was provided in Rajasthan followed by Andhra Pradesh, Uttar Pradesh, Madhya Pradesh, Tamil Nadu and Bihar. The Survey points out that towards increasing transparency and accountability in the MGNREGS, social audits have been conducted in 93 per cent of the districts ( as reported by the States). A new scheme for monitoring by eminent citizens has been introduced and 61 eminent citizens have been engaged and assigned to a district each to provide first hand feed back on the implementation of the scheme. An ombudsman has also been instituted in each district for effective grievance redressal. The Survey observes that further improvements in this scheme could include shifting to permanent asset building and infrastructure development activities, reducing transaction costs, better monitoring and extension of the MGNREGS to urban areas.

The Survey points out that as per the multidimensional poverty index (MPI), India with a poverty index of 0.296 and poverty ratios of 41.6 per cent (in terms of purchasing power parity (PPP) of $ 1.25 a day) and 28.6 per cent (national poverty line) is not favourable placed when compared to countries like China and Sri Lanka. The Survey indicates that Inter-State comparisons of socio-economic development of selected States show some interesting results. While developed States like Gujarat, Maharashtra, Karnataka, Haryana, Kerala, and Tamil Nadu have performed well in terms of many indicators, many hitherto backward states like Bihar, Orissa, and Uttarakhand are also showing good growth performance.

DSM/RM/MV/LS-10

MGNREGS reform: shift toward permanent asset building and infrastructure to improve transparency and reduce costs. MGNREGS has been providing significant household employment with administrative measures including social audits in most districts, assignment of eminent citizens for district monitoring, and establishment of a district ombudsman. Recommended reforms focus on shifting to permanent asset building and infrastructure development, reducing transaction costs, enhancing monitoring and accountability, and exploring extension of the scheme to urban areas.