DID INDIRA ABOLISH BONDED LABOUR OR SONIA?

By Kajol Singh / New Delhi

Success, they claim, has many fathers. It seems, success also spawns multiple motherhood claims.

In 1975, Indira Gandhi “abolished” bonded labour. Full page advertisements were released and sections of the pliant print media were packed off to rural areas to document how “liberated” former bonded labourers were experiencing joy in their new lives.
Thirty-eight years later, Indira Gandhi’s daughter-in-law, Sonia Gandhi, is now plastering the print and TV media with multi-crore advertising – funded by taxpayers – to announce that there’s “no bonded labour anymore”. It has apparently been ended by the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA or NREGA). “The landless SC, ST and BPL (below poverty line) population which earlier worked as bonded labour on farms of rich land lords has become free from their clutches owing to MGNREGA projects,” the ad claims.

Can bonded labour be abolished twice? Or is the current government saying the earlier announcement by Indira Gandhi’s government was a fraud and this one is for real? More likely, the truth is likely to be this: announcements need real growth and other support systems to bring about real change. Maybe MGNREGA helped end the remnants of bonded labour by allowing workers to contest the wages paid by traditional employers, but we needed growth to raise wages, not just MGNREGA (of which, more later).

Recent government ads, no doubt released with an eye on the next general elections, make several claims that are contestable, if not laughable. At other points the ads claim successes that are diametrically opposed to official Congress/UPA social policies.

Let’s start with the glaring incongruities first.

One ad, for example, claims that MGNREGA provided “about five crore households… with employment every year since 2008 “.

Let’s accept this figure as true. But contrast this with what the Planning Commission, headed by Manmohan Singh’s pal Montek Singh Ahluwalia, says in the 12th Plan.   Between 1999 and 2004, it says quoting National Sample Survey data, the economy created six crore jobs. By 2009-10, after five years of fast-paced growth, the economy created all of 0.27 crore jobs.

As Shankkar Aiyar notes in a New India Express column quoting the plan document: “Employment in manufacturing declined in absolute terms from 55 million to 50 million between 2004-05 and 2009-10, after having grown from 44 million to 55 million between 1999-00 and 2004-05. In services, employment increased from 94.20 million in 1999-2000 to 112.81 million in 2004-05 and declined marginally to 112.33 million in 2009-10. The working group on employment for the 12th Plan reveals that between 1999 and 2004, the economy, across all sectors added 60 million jobs while between 2005 and 2010, it added barely 2.72 million jobs.”

In short, during the slow-growth NDA period, the economy created 60 million (six crore) jobs across all sectors, while in the fast-growth UPA-1 period it created a measly 2.72 million – or 0.27 crore jobs.

The difference is 5.7 crore jobs that failed to get created under UPA-1. We don’t know if the situation has gotten worse since then in UPA-2.

Now juxtapose the 5.7 crore jobs that didn’t get created with the five crore jobs that did get created under MGNREGA.

We need to note the uncannily similar figures of jobs that failed to materialise in the natural course of growth and the five crore government-induced job created under MGNREGA. Did good jobs get destroyed and phony ones created, thanks to MGNREGA? Economists and researchers have their work cut out to explain this phenomenon.

In the same MGNREGA ad, apparently based on experiences with the working of the scheme in Pakur district of Jharkhand (which, until recently, was ruled by the BJP), a pond constructed with MGNREGA funds is said to have “developed into a platform for social interaction between people of various backgrounds. Social and religious events are held there regularly in which all participate together. This has started breaking the centuries old walls between castes and classes.”

Let’s once again accept the MGNREGA has started breaking social barriers. But contrast this with what the UPA (especially the Congress) actually believes.

The ad suggests that universal, community-neutral schemes like MGNREGA end up breaking caste and class barriers. This is what Narendra Modi says about growth being the great leveller, and every community being treated equally by government schemes. But the UPA has been trying hard to ensure quotas for Muslims in jobs, and recently it has also entered into a Faustian bargain with Mayawati to give SC/ST government employees quotas in promotions.

Is the MGNREGA ad now admitting that the UPA’s decision to seek development on the basis of group identities is antithetical to social bonding? Or is it trying some kind of double-speak: segregating people to win votes, even while launching universal schemes like MGNREGA and the Food Security Bill to  break the walls between communities?

Another claim made by the MGNREGA ad is that those employed “get higher wages and hence better living standards. They enjoy better health, good clothing and improved dietary habits.”

This writer would not doubt that MGNREGA, by artificially jacking up rural wages, ensures that workers can contest the lower wages paid in normal farm or non-farm work. But of greater importance to rising wages is growth – which UPA-2 is killing off.

Swaminathan Aiyar, writing in The Times of India, wins this argument convincingly by quoting a study by the Commission on Agricultural Costs and Prices (CACP), whose main job is to set minimum support prices for food crops. Explaining the rise in rural wages, Aiyar writes: “Analysing data for 16 states from 1990-91 to 2011-12, the CACP study finds that, overall, a 10 percent increase in GDP is associated with a 2.4 percent increase in real rural wages. Among sectors, the most important influence is not growth of agriculture but growth of construction, since construction is the sector that draws labour away from agriculture and creates a labour shortage that pushes up wages. A 10 percent growth in construction pushes up rural wages 2.9 percent.”

Put another way, this means MGNREGA had less of an impact in raising wages than growth, but growth is what UPA-2 has killed successfully. But MGNREGA may have contributed its share to rising inflation.

In UPA-1, we had growth but we killed jobs. In UPA-2, we killed off both growth and jobs.