8/8/2019 The Hindu - 10 Jan 2011 - A Notional Advisory Council

http://slidepdf.com/reader/full/the-hindu-10-jan-2011-a-notional-advisory-council 1/2

Opinion » Op-Ed

Published: January 9, 2011 23:25 IST | Updated: January 10, 2011 02:14 IST

 A Notional Advisory Council?

Jean Drèze

The National Advisory Council's recommendations on the National Food Security Bill are in danger of being brushed aside.

It is the fate of most advisory committees that the government accepts whatever advice suits its purposes and ignorethe rest. The first version of the National Advisory Council (NAC-1) managed to avoid that fate to some extent, due to

favourable circumstances. NAC-1 was able to persuade the government to enact the Right to Information Act, theNational Rural Employment Guarantee Act, and the Forest Rights Act, aside from other initiatives. None of theseproposals were accepted without change by the government — for instance, the NREGA draft prepared by NAC-1 wasseverely diluted before being tabled in Parliament (it was “repaired” later on, with some help from the Parliament'sStanding Committee on Rural Development and the Left Parties). Nevertheless, NAC-1 was instrumental in ushering

constructive legislations and policies that would, in all likelihood, never have seen the light of day through normalgovernment channels. This lent it some credibility, in spite of all the ambiguities attached to this unconventional

 body.

The second version of the National Advisory Council (NAC-2), however, has been convened in very differentcircumstances, and does not seem to have the ear of the government. A few weeks ago, NAC-2 drew the government's

attention to its fundamental duty to pay minimum wages to NREGA workers. This issue required some resolve and

application of mind, because framing a sustainable wage policy for NREGA that respects the Minimum Wages Act isnot a simple matter. Instead of tackling this issue, the government stuck to the inadmissible claim that NREGA has been “delinked from minimum wages”, and tried to make up for it by indexing the wages of NREGA workers (with aprovision for revising the base wages every five years).

Under the guise of meeting the NAC half-way, the government has made matters worse, by reaffirming itscommitment to non-payment of minimum wages to NREGA workers. Even the indexation of wages is little more thadamage control. In a fast-growing economy, the least one would expect from a government committed to “inclusivegrowth” is that it enables the poorest of the poor to maintain their share of the pie. That would mean indexing the

 wages of NREGA workers not only on the price level, but also on something like the growth rate of per-capita GDP. When per-capita incomes in the economy are growing at more than five per cent per year in real terms, why shouldthose of NREGA workers be kept constant for as long as five years, without any guarantee of upward revision at the

end of that tunnel? Yet far from being taken to task for its stinginess, the government managed to get credit for

1/10/2011 TheHindu:Opinion/Op-Ed:ANotiona…

thehindu.com/…/article1075384.ece?css… 1

8/8/2019 The Hindu - 10 Jan 2011 - A Notional Advisory Council

http://slidepdf.com/reader/full/the-hindu-10-jan-2011-a-notional-advisory-council 2/2

raising the wages of NREGA workers in line with inflation, that too after two years of incessant public pressure. Thisis like agreeing to stop trampling on the hands of someone who is hanging from the roof of a high-rise building by hifingernails, and getting a prize for it.

The NAC recommendations on the National Food Security Bill (NFSB) are in danger of going the same way if not worse. These recommendations are very mild, coming as they did at the end of a long process of consultation with various Ministries, when the government went out of its way to ensure that the NAC did not hatch any “unreasonable

proposal. But even the residue appears to be too much for the government's tiny stomach. Even before the NACrecommendations were adequately fleshed out, they were referred to an “expert committee” consisting entirely of government officials. This committee, headed by Dr. C. Rangarajan, must be commended for its timely deliberations

and sharp report. But the conclusions make one wonder why the government wasted the NAC's time: the Rangarajancommittee recommendations are almost exactly the same as the Planning Commission's NFSB proposal, formulatedbefore the NAC started its work. If anything, they are more conservative: the Rangarajan committee suggests selling

PDS foodgrain to non-BPL households at the Minimum Support Price (MSP), instead of 75 per cent of MSP as thePlanning Commission had suggested.

The committee report

The Rangarajan Committee rejected the NAC proposals on the grounds that further raising of procurement levels would “lead to a lower availability of foodgrain for the open market, pushing up prices”. This argument is incorrect:

higher procurement would also mean higher distribution, and the two would, in principle, approximately “cancel ouas far as the effect on market prices are concerned. Coming from a committee that includes at least two world-class

economists, this failure of A-level economics is a little embarrassing. Could it be that the committee's judgment wasclouded by a fundamental resistance to the idea that the ambit of the Public Distribution System should beexpanded?

There is another glitch in the Rangarajan Committee report. The report recommends sweeping PDS reforms, wherebthe food subsidy would be transferred directly to the beneficiaries through a Smart Card, usable in “any store”. Thecommittee's faith in this entirely untested system is touching. But suppose it works. Most of the subsidised food wouthen find its way “through the normal market channels”, as the report happily notes. But in that case, where is thequestion of a procurement constraint?

For good measure, the Rangarajan Committee focuses exclusively on the PDS component of the NAC proposals, andignores the non-PDS entitlements such as child nutrition programmes, maternity entitlements and destitute feedingThis jars with the committee's recognition of India's massive “nutritional deficiencies”, and also with its well-taken

observation that better nutrition is “a necessary prerequisite for economic development”. A historic opportunity is being missed to do justice to these fundamental concerns.

(The author is Visiting Professor at the Department of Economics, University of Allahabad and Member of the National Advisory Council .)

Keywords: Food security 

Printable version | Jan 1 0, 201 1 3:32:43 PM | http://www.th ehindu.com/opinion/op-ed/article107538 4.

© The Hin

1/10/2011 TheHindu:Opinion/Op-Ed:ANotiona…

thehindu.com/…/article1075384.ece?css… 2