Wage sparks fly on job scheme - UPA draws flak over minimum rate, Ahluwalia lone defender

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  • Published 19.01.11
Montek Singh Ahluwalia

New Delhi, Jan. 18: Members of the National Advisory Council (NAC), labour activists, lawyers and Left politicians today slammed the UPA for decoupling the pay for the rural job scheme from minimum wages, leaving Montek Singh Ahluwalia as the lone defender of the government at a gathering.

The trigger for the barrage of criticism was the Prime Minister’s reaffirmation of a notification of the rural development ministry that froze at Rs 100 the daily wages under the Mahatma Gandhi National Rural Employment Guarantee Act (MNREGA).

Sonia Gandhi, who heads the NAC, had written to the Prime Minister to consider linking the rural job scheme to minimum wages, which are higher than Rs 100 in many states. Many believe that the blockbuster welfare project played a key role in the return of the UPA to power.

In his reply, the Prime Minister said a wage index would be developed for the job scheme and till then, the wages would be linked to inflation. The reply was seen as a polite rejection of the demand to link the job scheme directly to minimum wages – another sticking point at a time the NAC and a panel appointed by the Prime Minister are at odds on the food security bill.

Many participants in the seminar on the minimum wage policy for the unorganised sector, convened by the Bandhua Mukti Morcha, seized on this rejection to suggest that the government was setting the stage for “forced labour” as its order violated a court directive on minimum wages.

The minimum wage statute has been upheld by several judgments of the Supreme Court, including the one dealing with Kamani Metals and Alloys versus workers. The court said a minimum wage must be paid, irrespective of the extent of profits earned by an employer, his fiscal condition or the availability of workers for lower wages. It held that non-payment of minimum wages was tantamount to “forced labour” that is banned under Article 23 of the Constitution and violated a fundamental right.

The UPA government had invoked Section 6 (1) of the MNREGA in its defence, stating: “Notwithstanding anything contained in the Minimum Wages Act, the central government may, by notification, specify the wage rate for the purpose of the act.”

Responding to a petition from labour groups on the non-payment of minimum wages, Andhra Pradesh High Court had suspended the rural development ministry’s notification for a period of eight weeks and restored Section 6 (2) that stipulated that until a wage rate is fixed by the Centre for a state, that state government has to pay the legal minimum wage.

But since the rural job scheme workers in Andhra continued to be paid less than the minimum wage, the petitioners filed a contempt petition against the central and state governments. The cases remain unsettled.

At the seminar today, A.P. Shah, the former chief justice of Delhi High Court, said: “Where is the rule of law if the government can so easily violate a court order? The government has been in contempt for more than one year, which virtually means that the common man has no legal remedy against the state.”

Ahluwalia, the Planning Commission deputy chairperson, said: “The government will have to go by what the court says.”NAC member Aruna Roy then said: “You are asking to wait for the court procedures to be completed. I dispute this.”

Ahluwalia replied: “This is becoming complicated. You can contest the legal procedures. When all the legal options are exhausted, the government will obey what the court says.”

Nikhil Dey, an RTI activist, told the gathering of largely landless farm-hands from Rajasthan that included women with babies huddled in their arms: “The government stands in contempt of the court for 18 months. There is no legal procedure, no minimum wage.”

Another NAC member Harsh Mander, who is spearheading the movement for the universal food security coverage, said although India was not short of pro-poor laws and schemes, “the government is unwilling to implement them”.

Mander said while the rural job scheme could have “facilitated the extinction of bonded labour”, the convergence of caste and class-based vested interests in rural India militated against the payment of minimum wages. “Farmers should get the right price for their produce but it cannot be anybody’s case that farmers should prosper while the workers wilt away,” he said.

Although government sources cited resource crunch, some speakers at the seminar said linking to the minimum wage would not entail an additional annual expenditure of more than Rs 1,200 crore.

Other speakers felt that a powerful farm lobby was at work to keep the scheme away from the minimum wage. The lobby apparently fears that such an empowerment will trigger a clamour for similar rates elsewhere in rural India that has many places where the minimum wage is yet to be enforced despite the Supreme Court’s orders.