The Hindu : National : Government turns down proposal to cut wage rates

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Thursday, Jul 06, 2006

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National

Government turns down proposal to cut wage rates

Special Correspondent

P. Chidambaram for fixing the maximum wage rate at Rs. 60

NEW DELHI: The Central Government on Wednesday shot down the Finance Ministry's proposal to effectively lower the wage rates under its flagship employment scheme, the National Rural Employment Guarantee programme.

A high-level meeting, presided over by Prime Minister Manmohan Singh, did not approve Union Finance Minister P. Chidambaram's proposal for fixing the maximum wage rate at Rs. 60 in the States where the minimum wage rates for agricultural labourers were higher than that. The proposal did not seek any change in the States where it was below Rs. 60.

Talking to reporters after the 45-minute meeting at the Prime Minister's residence, Defence Minister Pranab Mukherjee said since the NREG scheme had not been fully operationalised, the Government decided to continue it in the present format. "We will review the proposal once the scheme is fully operationalised."

The scheme would have become unattractive for job seekers in Tamil Nadu, Kerala, Andhra Pradesh, Rajasthan, Punjab and Haryana where the minimum agricultural wages were more than Rs 60.

Union Rural Development Minister Raghvanash Prasad Singh, who opposed the proposal, said people might not opt to work under the scheme in these States thus defeating the central purpose of the Act. Hence, it was decided to leave it to the States to fix the minimum wages for agricultural labour.

Besides Mr. Raghuvansh Prasad Singh, Mr. Chidambaram and Mr. Mukherjee, Deputy Chairperson of Planning Commission Montek Singh Ahluwalia and B.N. Yugantar, member, Planning Commission, attended.

The Left parties opposed the proposal and wrote to the Prime Minister on the issue.

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