The Prime Minister has written a letter to all Chief Ministers drawing their attention to the National Rural Employment Guarantee Act 2005, seeking their cooperation in its effective implementation.The text of the letter is reproduced below:

New Delhi

October 13, 2005

Dear Chief Minister,

1. The National Rural Employment Guarantee Act 2005 (NREGA) passed by the Parliament in August 2005 is a path-breaking legislation for securing the livelihood of the people in rural areas through a legal guarantee of 100 days of employment in a financial year to a rural household.Our country is the first to offer a legal guarantee like this on such an unprecedented scale and it reflects our commitment to provide an effective safety net to the poor.

2. A significant commitment made in the NREGA is to extend its application to the entire country within five years, beginning with 200 backward districts. These districts provide a ground for us to put in our best efforts and our collective will to make this Act an effective instrument in ensuring livelihood security in rural areas. Our track record of performance in these 200 districts will yield useful insights and lessons in extending it across the country. Therefore, the quality of implementation of the Act in its initial phase is crucial in all respects and the role of State Governments critical.

3. The implementation of NREGA envisages a collaborative partnership of the Central and State Governments and of the Panchayati Raj Institutions (PRIs). The Central Government will bear 90% of the cost of providing employment under this Programme. The State will have to bear only 10% of the cost. While the Centre will ensure timely resource support to the Programme, the State will have to ensure that wage employment is given within 15 days of demand for work, failing which it will be liable to pay Unemployment Allowance at its own cost.

4. For effective implementation of NREGA, delivery systems, specially the Panchayati Raj Institutions, will have to be geared up. Panchayati Raj Institutions have been given principal responsibility for planning and implementing the Programme. This is an opportunity for strengthening the grass root processes of democracy, and you would have to ensure capacity building of PRIs in order to prepare them for this purpose. Besides the PRIs, other implementing agencies like the District Administration and Line Departments should be properly trained on their tasks. All agencies responsible for implementation at all levels should know that no deficiency, deviation or willful negligence will be tolerated.

5. A major area for attention is planning. The NREGA gives an opportunity to the local communities and PRIs for local area planning. At the same time we have to ensure resource support to them to be able to have feasible plans ready well in advance to meet the demand for work in fifteen days.

6. Another critical area in implementing the NREGA is the process of selection and designing of productive works. This process has to be done in a way that durable assets are created strengthening the livelihood resource- base of the area, so that those who work for wages in creating these assets, over a period of time move onto self- sustaining employment.

7. The NREGA offers an opportunity to empower weaker sections of our society.People from SC/ST communities, beneficiaries of land reforms and of Indira Awaas Yojana can benefit through irrigation works on their fields.Women have been given priority in the allotment of employment opportunities.Thus, the economic security offered by the NREGA can be leveraged for social equity,as well.

8. You may appreciate that the NREGA invests the rural people with the right to demand employment and they should know it.We must spare no effort in communicating the meaning and purposes of the Act wide across the rural areas, specially where poverty and distress migration describe the condition of living.We must also be vigilant in ensuring that the resources invested in the people of these areas are well-utilised.Systems of strict monitoring, verification and evaluation will have to be established so that people get their full entitlements under the NREGA.

9. The issue of governance being vital for effective implementation, I would request you to ensure that officials dealing with the programme are among the best in the State. On their performance hinges the impact of this major intervention that we are making for the poor.

10. Finally, for the NREGA to achieve its objectives, the implementation processes under it have to be characterised at each stage and level by transparency and public accountability, in keeping with the Right to Information Act. We have a historic opportunity to take a significant step towards transforming the rural economy of our country through the instrument of the NREGA. Let us make it our collective commitment and pledge full support to the effective implementation of this historic legislation.

With warm regards,

Yours sincerely

(Manmohan Singh)