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Indian Economic Policy

Notes A review of the progress of the scheme during the 10-year period (1972-73 to 1982-83) revealed that
while the expenditure incurred on the implementation of various programmes under EGS has been
increasing, the number of mandays of employment generated as a result of these programmes has
declined continuously over the years. During the first seven years, the progress of the scheme was
good in as much as the mandays of employment generated increased from 45 lakhs in 1972-73 to
20.54 crores in 1979-80 along with the increase in expenditure from ` 1.89 crores in 1972-73 to Rs.
102.2 crores in 1979-80. However, since 1980-81, the trend of mandays of employment generated
declined to l2.8 crore mandays with an expenditure of ` 130 crores in 1982-83. As against an expenditure
of ` 5.3 per manday of employment generated in 1979-80, this increased to ` 10.2 in 1982-83.
Since the average daily wage of an unskilled labourer was raised to ` 6 per day, part of the explanation
for the reduction in mandays of employment generated could be found in it. The other part of the
explanation was provided by the rise in prices. A part of the rise in expenditure per manday of
employment might be also due to leakages and malpractices that have become a part of our
administrative culture.
Only productive works with unskilled wage component of more than 60% were taken up under EGS.
Modifications of the scheme permitted individual beneficiary schemes to be also taken up in the case
of lands owned by small and marginal farmers. In such cases, 50 per cent of the expenditure was be
borne by the concerned cultivator/ beneficiary. Besides this, a horticulture programme covering a
total of 10 lakh hectares was launched during the Eighth Plan (1992-97) at Government cost on lands
of SC/ST/ small cultivators. On other lands, Government and the beneficiaries were to bear the
expenditure on materials in the ratio of 75 : 25.
According to the Eighth Plan, “the scheme has resulted in a significant reduction in the incidence of
unemployment in rural areas. Average daily unemployment rates in rural Maharashtra have declined
from 7.20% in 1977-78 to 3.17% in 1987-88. It would have also contributed to some extent towards the
decline in rural poverty from 60.4 per cent in 1977-78 to 36.7 per cent in 1987-88. The scheme has also
helped in keeping an upward pressure on wages in rural areas. The EGS has benefitted a large number
of women too, with nearly 60 per cent of the workers on EGS sites being women.”
National Rural Employment Programme

The Food for Work Programme was restructured and renamed as National Rural Employment
Programme (NREP) from October, 1980. This was implemented as centrally sponsored programme
with 50 per cent central assistance. Additional employment of the order of 300-400 million mandays
per year for the unemployed and underemployed was envisaged under the NREP. Besides this, the
NREP aimed to create community assets for strengthening rural infrastructure. These included
drinking water wells, community irrigation wells, village tanks, minor irrigation works, rural roads,
schools and Balwadi buildings, panchayat ghars etc.
A critical assessment of the projects undertaken brought out the following shortcomings :
(i) “Works implemented through NREP are often, not coordinated or integrated with the requirements
of families identified for assistance under IRDP. Potentiality of NREP worked to assist newly
liberated bonded labourers or to support the attempts of agricultural workers to secure minimum
wages fixed under the law is also not always appreciated. Stereo-typed earth excavation works
mainly relating to Kachcha village roads, reminiscent of the old famine relief works, are undertaken
ignoring the fact that this programme has a crucially supportive role to play for the beneficiary
oriented development programme of IRDP and other area development programmees.”
(ii) There is a tendency to go in for building construction with high material components. This runs
counter to the basic objectives of NREP. The principal purpose of NREP is to utilise local
resources, both in terms of materials and manpower towards the generation of more employment.
Rural Landless Employment Guarantee Programme

The Rural Landless Employment Guarantee Programme (RLEGP) was launched on the 15th August,
1983 with the objective of generating gainful employment, creating productive assets in rural areas
and improving the overall quality of rural life.

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