Prime Minister of India - Dr. Manmohan Singh

PM's address at the Conference of State Ministers of Rural Development and Panchayati Raj

"I am very happy to be here in your midst today at this very important conference of State Ministers of Rural Development and Panchayati Raj convened to discuss the critical issues of employment generation and providing livelihood, security to our people in large part s of rural India. I congratulate my colleague, Dr. C.P. Joshi, the Minister of Rural Development and Panchayati Raj for taking this timely initiative. We have now been implementing NREGA for the past five years. Important lessons can be learnt. There are success stories, there are indifferent performances in some parts of our country and the time has come when we should draw correct lessons from this experience of last five years to put in place a reform programme which meets the legitimate aspirations of our rural population.

Of course, we are today meeting at a time when the monsoons have revived fortunately in most parts of the country. The rains over the past week augur well for the kharif crop and have brought cheer to large number of our farmers. But we have to recognize that most areas of the country will probably still have deficient rainfall and therefore we have to redouble our efforts to mitigate rural distress arising from the after effects of drought.

We had record production and procurement of foodgrains in both 2007-08 and 2008-09. We thus have adequate food stocks and there is no cause for concern or fear of shortages of foodgrains in the country as a whole. I have however no doubt that we will tackle the situation effectively and resolutely. Foodgrains supply should be available in localities where there is deficiency of production in relation to demand. Also utmost care ought to be taken to deal with scarcity of fodder and drinking water.

Further, we have today the means to put purchasing power in the hands of the rural population. I think Dr. Amartya Sen, the Noble Laureate economist has repeatedly emphasized that famines are not necessarily famines of deficient production but of deficient purchasing power and for the first time in our history we have an opportunity to put purchasing power in the hands of most needy parts of our population through the mechanisms of National Rural Employment Guarantee Programme.

Both the NREG Programme and the Swarnjayanti Gram Swarozgar Yojana are on the whole working well and have created an effective safety net in rural India. NREGA has put a floor on rural poverty and it affords a measure of protection against natural calamities or market�induced vulnerability. But as Dr. Joshi has pointed out, the performance varies from one part of our country to another and I sincerely hope your Conference will deliberate on this issue, identify best practices which with modification can be replicated in other parts of our country.

In 2008-09 under NREG Programme, employment was provided to nearly 4.5 cr households. Of those employed, nearly 50 percent were women and over 55 percent comprised of Scheduled Castes, Scheduled Tribes demonstrating the self-targeting nature of the programme. In the three-and-a-half years of its implementation, the Central Government has released over Rs 50,000 cr to the State Governments. Nearly two-thirds of this amount has been paid as wages to NREGA workers. In terms of outlays, the Ministry of Rural Development has the highest priority in our scheme of things and that is a measure of our commitment to do all that we can to get rid of chronic poverty, ignorance and disease which still afflict millions and millions of people of our country.

Works under NREG Programme are helping to rejuvenate and revive our natural resource base. I have been told that over 70 percent of the works under NREGA are related to water conservation and land development which have multiple spin off benefits in terms of improved agricultural productivity and improved water management. Agricultural productivity is being enhanced. Water assets are thus being created. Land and soil degradation is being checked.

The programme is also making a contribution to financial inclusion. State Governments are being encouraged to make wage payments under the Programme through banks and post office accounts. Nearly 7.8 cr of such accounts have been opened. The growing practice of making use of the financial institutions for disbursement of wages is one means of reducing leakages and in often ensuring that wages are paid in accordance with prescribed schedule.

The bargaining power of agricultural labour has increased as a result of the launching of the NREG Programme. No longer are they prepared to settle for less than the notified wage. The average notified wage under NREGA has itself risen from Rs. 65 per day in 2006-07 to Rs. 87 in 2009-10. We have further committed ourselves to providing a real wage rate of Rs. 100 under NREGA.

However, the major successes achieved through this programme should not be a cause for complacency. We must think creatively, we must think innovatively, we must anticipate events as they unfold before our eyes. Therefore, we still have miles to go before we achieve the full potential of this unique legislation in annals of recent history. The performance of the programme as I have mentioned, has been uneven across States. Some States have shown good results. Some are lagging behind. I urge them to catch up. We cannot fail the poor of our country particularly at a time when resources are available to provide gainful livelihood security for atleast 100 days to the rural poor.

A Delivery Monitoring Unit has been set up recently in the Prime Minister's Office to monitor jointly with the concerned ministries flagship projects such as NREG Programme. The major difference of this monitoring process will be that we will put as much data as possible in the public domain, on the websites of the ministries concerned. From the right to information, we are moving towards the rights of the people to expect from the Government full and complete disclosure. This is in line with our thinking of moving beyond providing a right to information to a policy of voluntary disclosure. Workers on the ground and researchers therefore are free and should make independent assessments of the scheme and challenge government data and claims of performance. We need therefore to shift from input based monitoring, which can often be self-congratulatory, to independent evaluation of outcomes.

We propose to establish the institution of an Ombudsman in every district for effective grievance redressal under NREG Programme. We should also mobilize public opinion and use social audits to seek the enforcement of rights and entitlements created through this landmark legislation.

Our government has taken a major decision to restructure and redesign the Swarnajayanti Gram Swarozgar Yojana and convert it into a National Rural Livelihoods Mission. This new scheme will be implemented in a mission mode. This Mission will use a multi- pronged strategy for poverty reduction in a time bound manner by providing sustainable livelihood through various means to rural population below the poverty line.

The Ministries of Rural Development and Panchayati Raj and the State Governments, I sincerely hope will work in tandem to develop a collective vision for this Mission. From what I have seen of Dr. Joshi's work since he became my colleague, I have full confidence that this Ministry will rise to the challenge that lies ahead. Eventually as the Mission rolls out it should become the pivot for all our rural poverty reduction initiatives. The NRLM is intended to achieve the next level of security, i.e. security of employment assurance through achievement of its objective of skill development and promotion of self-employment. We are going to launch a very ambitious skill development programme and I sincerely hope it will become an integral component of a programme to provide gainful livelihood opportunities for our young people.

The institution of the Self Help Groups in mobilizing the rural poor has proved to be a potent instrument of empowerment of the poor. The primary goal of the Mission should be to saturate mobilization of poor communities into Self Help Groups in a time bound manner. Investments in aggregate level people's institutions like federations of Self Help Groups is a very important step that will provide space, voice and resources for the poor. The National Rural Livelihood Mission should therefore make dedicated efforts to pilot, to learn and in due course of time, to scale up such productive partnership between our people and our Government institutions.

Some states have made significant investment in the institutional architecture for organizing the rural poor and making them creditworthy clients for banks and other financial institutions through capacity building & training programme. In these states there has been remarkable progress in terms of creation of assets for self-employment and providing sustainable livelihood particularly for our women in rural areas.

Banks operating in rural areas must therefore revisit their current brick-and-mortar based outreach models. They have to think creatively and innovatively. ICT enabled banking services can overcome many of the manpower constraints and develop new financial products suited to the needs of people at various levels of development. We should also explore opportunities for the expansion of the agency banking concept. Adequate attention should be paid to organizing the demand side of the credit delivery by organizing financial literacy and financial counseling services for the poor.

Investment in skill development and training as I have said earlier, is a very important area and the Mission may take steps to make skill development as an 'entitlement' of the poor.

This year's allocation under NREG Scheme is over Rs.39,000 cr. Under the SGSY it is Rs.2,350 cr. Under the Rajiv Gandhi National Rural Drinking Water Mission and the Pradhan Mantri Gram Sadak Yojana, provisions have been made for Rs.8,000 cr and Rs.18,500 cr respectively in the current year. Allocations for poverty alleviation programmes are rising every year. We have now to ensure that our people get the best value for every rupee spent on their behalf. Effective oversight of these programmes is therefore, extremely important.

The panchayat is the best institution to implement programmes such as NREG Programme. It has been observed that wherever local bodies are active, functioning well and are manned by committed people, the delivery is much better. There is therefore a need to undertake an intensive campaign for developing skills of Panchayati Raj Institutions in designing, in planning, in monitoring and in implementing programmes like NREGA. It should be our common aim of the Centre and the States to implement these programmes through the panchayats wherever possible and feasible. In States where panchayats are not active or adequately empowered, State Governments, I urge, should move forward to ensure this outcome.

In conclusion, I wish to assure you that the government attaches the highest priority to the successful implementation of these flagship, anti-poverty programmes. We should work therefore purposefully to improve the quality of the public system and delivery of public services to achieve the objectives of spreading, deepening and widening of rural prosperity and of employment generation. I trust your deliberations will be guided by our common national commitment to make rural India the backbone of our inclusive social and economic growth. I wish you all success in your deliberations."