Wednesday, February 18, 2009

Visits to South Dinajpur

On Monday. 16 Feb, Puthumai, Ms. Chelsea of Seattle University, Ms. Rekha Soren, Mr. John Hembrom and few other staff of Social Welfare Institute went to Kumarganj in South Dinajpur district 100 kms east of Raiganj to attend what is called a "GPDMC", which is actually a Rural Local Government body's Disaster Management Committee, that are being strengthened through the efforts of Social Welfare Institute with support from Catholic Relief Services. There were about 70 men and women being trained in the role of the Disaster Management Committees at the local level and how they can coordinate Community Based Disaster Preparedness and Mitigation measures in the villages. Ms. Chelsea also got an opportunity to interact with few women in the villages who have practically nothing in their families other than couple of livestock--goats or pigs--that have been given by SWI as part of economic development.  On 17 Feb, Mr. Sanjay Rozario, the Zonal Manager of Caritas India visited two villages near Kumarganj along with Fr. Herman Kindo and Puthumai A. Nazarene to review the Micro-Finance Program supported by Caritas India. He also took time to interact with the Staff overseeing the program and with the village women. 

Thursday, February 5, 2009

Employment Scheme and Corruption in Bank Accounts

A team conducting Social Audit in Jharkhand has found that the Banks and local middle men are hand in glove with eachother using the illiteracy of the poor and inaccessibility of the Government officials to enjoy fruits of hard labour of the poor under the National Rural Employment Guarantee Act (NREGA) in five panchayats of Karon block, 45 kms from Deoghar. The District Adminsitration has initiated action against the Deoghar-Jamtara Central Cooperative Bank, for corruption and malpractices.

The recent drive by the government to introduce the NREGA wage payments through banks and post offices (PO) has to be understood against this backdrop. This policy was put forward as a necessary step to tackle corruption because it separates payment agencies from the implementing agencies. This was prioritised to such an extent that a Ministry of Rural Development circular (dated January 21st, 2008) instructed: "Opening of bank and post office accounts of all the NREGA beneficiaries must be done before April 1st, 2008", that is within a period of two months. The number of new bank accounts opened during this period became a yardstick for measuring the success of this initiative. It was hailed as a commendable effort, a reflection of a dynamic new India. However, somewhat inconveniently, a recent social audit in Deoghar and news from other states, like Rajasthan, Uttar Pradesh and Orissa, revealed that this new policy was not faring as well as the ministry had expected. In fact, they indicated that instead of stamping out corruption, the policy was in danger of becoming a new breeding ground for corruption. This leaves us to wonder what went wrong with the policy which was passed off as another success story by our policy makers?

There are two distinct patterns of irregularities involving bank payments. In Karon, there are many laborers who claimed to have worked for various NREGA projects but were paid in cash while the official records showed that all wages had been paid through bank accounts. Bank ledgers also confirmed the official line, but revealed a curious pattern of transaction. It is not difficult to believe that a labourer would withdraw the entire sum deposited in his account a day before, but why should one withdraw Rs 100 on the 3rd and Rs 200 on the 4th, while exactly the same amounts were deposited on 1st and 2nd respectively? The reason became clear when the audit team spoke to the account holders — it appeared that they had not worked in the projects for which their accounts were debited, they had never signed any withdrawal slips and never been to the bank after opening an account. Little wonder their passbooks were completely blank and the relevant information was not recorded on their job cards. The jigsaw puzzle was now in place — contractors pay the labourers Rs 50-70 per day in cash, well below the stipulated minimum wage rate (Rs 86.40 per day), but the cheques are drawn (often with inflated number of working days) in favour of those, whose accounts are entirely operated by the contractors and bank officials. Sometime these 'phantom' labourers also become unsuspecting accomplices of the contractors, for a small sum of money they let the contractors operate their accounts. There was clear evidence of other irregularities as well, contractors or bank officials hoarding labourers passbooks, banks charging an extra fee for opening NREGA accounts (it is supposed to be free in banks and to cost Rs 60 in post offices). It is evident that in Jharkhand, or at least in Karon, a cartel of contractors and bank officials (in Badiya Panchayat, it was found that the contractor is none other than the son of the local postmaster) has defeated the very purpose of separation of responsibilities. Introduction of bank payment has only added a new claimant of kickbacks from the NREGA funds.
Even in places where banks are not directly involved, a new layer of bureaucratic/ administrative procedures has made the labourers increasingly dependent on the middlemen. Bank payments are regularly delayed: We found that in Jharkhand, a two -month delay in clearing a cheque is quite normal, although the NREGA Operational Guidelines stipulate that payments have to be made within fifteen days. In some cases, labourers and the cheque-issuing authority have accounts in different banks, leading to an obvious hold-up. However all the bank officials  were unanimous in pointing to the shortage of staff as the main culprit (just to give an idea, the average number of employees per office in the State Bank of India has decreased by almost 25 per cent in the last five years). Ignoring these ground realities, the NREGA guidelines advised banks to undertake special awareness activities to familiarise workers with banking procedures — this at a time when they were finding it difficult to cope up with even their regular work. In such a scenario, it should not come as a surprise that some middlemen took full advantage of this situation.
One wonders why bank payment was introduced in such a hurry, without proper planning, proper safeguards and proper guidelines. This is particularly perplexing because the system of bank payments was not introduced in a vacuum — it was replacing the existing practice of cash payments. Moreover, even a quick look at the NREGA guidelines on bank payments will reveal a complete lack of safeguards, unlike those involving cash payments: In case of the latter, muster rolls to be read aloud, wages have to be paid in public, etc. Why did our planners in the Ministry of Rural Development start chanting the magic mantra of separation of responsibilities while completely ignoring the logic of checks and safeguards? For us casual observers it could be a mystery-drama but we should not forget that the victims here are rural labourers, for most of whom the NREGA is a vital lifeline. As for the planners, let's give them their due credit: This is the age of showbiz, why should policies be any different?
(With inputs from other friends.)

 

Looking Beyond

The lost weeks have been quite eventful, with the interim audit, the Governing Body meeting on the 15 Jan, and number of trips to Delhi, Kolkata, and a pleasure trip to Hazaarduari (Place of Thousand Gates) with Chelsea, and knocking at my University to check on the update on my marksheet as the University has failed to update my marksheet etc. It has also been quite a different experience for me to deal with things as I have tranfered financial responsibilities to Fr. Herman, and so that leaves a lot of space for me, and a bit of time to get hold on pending things. But I have not sat down to work much, as I begin to feel how much my body needs some rest. So, I am letting my body and mind relax, to let them understand that I do care for them.