Length of the Last Mile: Delay & Hurdles in NREGA Wage Payments
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Length of the Last Mile Delays and Hurdles in NREGA Wage Payments LibTech India | November 2020 Foreword by Jean Drèze 1 2 Length of the Last Mile Delays and Hurdles in NREGA Wage Payments LibTech India | November 2020 Foreword by Jean Drèze 3 © 2020 Azim Premji University. This publication may be reproduced by any method without fee for teaching or nonprofit purposes. The publication shall not be used for commercial purposes. Rights are reserved under Creative Common Licence. Any derivative works shall also be protected under the same license. Rights are reserved under Creative Common Licence: Attribution + Non-Commercial + Share Alike. For copying in any other circum- stances, or for re-use in other publications, or for translation or adaptation, prior written permission must be obtained from the publisher. Download from: http://libtech.in/length-of-the-last-mile/ Disclaimer: The analysis and opinions expressed in this publication are those of the author(s) and may not represent the view of the University. 4 I am not your data, nor am I your vote bank, I am not your project, or any exotic museum object, I am not the soul waiting to be harvested, Nor am I the lab where your theories are tested, I am not your cannon fodder, or the invisible worker, or your entertainment at India habitat center, I am not your field, your crowd, your history, your help, your guilt, medallions of your victory Abhay Xaxa 5 Table of Contents Abstract ............................................................................................... 03 Foreword ............................................................................................ 04 About LibTech India .......................................................................... 07 Team members .................................................................................. 08 Acknowledgements ................................................................... 10 Data Summary ................................................................................... 12 Introduction ....................................................................................... 17 NREGA in Times of COVID-19 ................................................................... 19 1. NREGA: Background and Context ................................................. 22 Financial Inclusion ................................................................................... 24 NREGA Wage Payments Over the Years ................................................. 26 2. Length to the Last Mile ................................................................... 30 Delays in wages payments in our sample .............................................. 34 3. Research Questions for the Survey ................................................ 35 4. Methodology ................................................................................... 36 Hardship Scores ....................................................................................... 40 6 5. Limitations of the Survey ............................................................... 42 6. Findings ........................................................................................... 44 Demographic and household details ..................................................... 44 Disbursement Agencies ........................................................................... 48 Dimensions of challenges assessed ......................................................... 51 Awareness and Access to information ............................................... 52 Information about wages ................................................................... 55 Time and cost related challenges ....................................................... 57 Transparency ....................................................................................... 64 Commissions ....................................................................................... 69 Aadhaar and Biometric related challenges ...................................... 70 Hardships ................................................................................................... 75 Reported Hardships ............................................................................ 76 Rejected Payments ................................................................................... 84 Awareness among people with Rejected Payments ......................... 88 Hardships among by workers with Rejected Payments ................... 90 Grievance Redressal .................................................................................. 91 Grievances among those facing hardship .......................................... 93 Grievances Registered ......................................................................... 95 Time and Costs of Filing Complaints ................................................. 98 Preference of Payment Disbursement Agencies .................................... 99 Preference of payment disbursement agency for bank users .......... 99 Preference of payment disbursement agency for CSP/BC users .... 100 Preference of disbursement agency for PO users ............................ 101 Transaction Verification ......................................................................... 102 1 7. Recommendations ........................................................................ 106 Job Card Registration and Work Demand ............................................. 107 Transparency on Cash Transfers ............................................................. 108 Reduction of Time and Cost per transaction ......................................... 110 CSPs/BCs .................................................................................................. 110 Accountability ......................................................................................... 112 Rejected Payments .................................................................................. 113 Grievance Redressal ................................................................................ 114 8. Appendices ..................................................................................... 115 A.1 Data Cleaning & Missing Value Imputation .................................... 115 A.2 Robustness Checks for Reported Hardship Scores .......................... 121 A.2.1 Exploratory & Confirmatory Factor Analysis (CFA) .................. 126 A.2.2 Multiple Factor Analysis (MFA) ................................................ 135 Annexure ............................................................................................ 141 Endnotes ............................................................................................ 142 Bibliography ...................................................................................... 143 2 Abstract LibTech India has been working in numerous states on various aspects of the Mahatma Gandhi National Rural Employment Guarantee Act (NREGA) for almost a decade. This report is built on our collective experience regarding NREGA wage payments. Through a 3 state survey, we focus on the last mile challenges faced by workers in accessing their wages after the wages have been credited to the workers’ bank or postal accounts. Delays in wage payments are usually higher in the second half of each financial year due to rationing of funds for NREGA. To focus on the last mile challenges when funds crunch is not the main concern, we conducted this survey in the first half of the financial year 2018-19. The survey was conducted in one block each of Andhra Pradesh (AP) and Rajasthan (RJ) and 2 blocks of Jharkhand (JH). We interviewed 1947 workers and asked about their experience concerning four payment disbursement agencies -- Banks, Customer Service Points (CSPs)/Business Correspondents (BCs), Post Offices, and ATMs. Post offices were prevalent only in Andhra Pradesh. We examine and discuss the following aspects: workers’ awareness about some banking norms, access to information, hardships in accessing wages, transparency & accountability of disbursement agencies, issues concerning payments that get rejected and the workers’ experience of using grievance redressal systems. Although the sampling was purposive, experience suggests that our results and statistical estimates are likely to be consistent across the respective states. We create average hardship scores of individuals for each payment disbursement agency. We use confirmatory factor analysis and multiple factor analysis scores to check for robustness of average hardship scores. The respondents from the AP block reported less hardship, on average, compared to the blocks in RJ and JH. Workers from the JH blocks report the highest hardship. Countrywide, roughly one in twenty wage payment transactions get rejected due to technical errors such as incorrect account number or incorrect linking of Aadhaar with bank accounts. We pay close attention to rejected payments and assess the difficulty faced by workers once their wages get rejected. We make several recommendations, categorised by issues, to strengthen NREGA workers’ rights. This report is an attempt to document the perspective of the workers in accessing their own wages. We hope that through the report, policy makers, practitioners, academics, and other civil society members can collectively understand the challenges workers face at the last mile to access their wages. For such a collective understanding to work effectively, it is critical to involve the workers in designing