NREGA wages to reflect rising costs

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New Delhi:  The government has firmed up an indexing system of minimum wages for various categories of labour to match the inflation after Congress President Sonia Gandhi asked Prime Minister Manmohan Singh to ensure that labourers are paid the minimum wages.

The Rural Development Ministry is soon expected to issue a notification detailing the payment of minimum wages to various categories of workers, like industrial labourer or agricultural labourer, in tune with inflation, sources said on Wednesday.

The order will be effective from January 1, 2011, they said.

Sonia Gandhi, in her capacity of National Advisory Council (NAC) Chairperson, had written to Singh, saying that the wages of labourers should be linked to Consumer Price Index (CPI) to ensure that they are protected against the inflation, sources said.

She had said that the payment of minimum wages by the states as prescribed under the Minimum Wages Act should be ensured under the National Rural Employment Guarantee Act (NREGA).

In his response, Manmohan Singh explained that the Minimum Wages Act and NREGA were two separate dispensations, providing for different wages.

Under the NREGA, a labourer is entitled to Rs 100 per day while under the Minimum Wages Act, the minimum wages are fixed by the states and these vary.

While explaining the situation, the Prime Minister has noted that proper indexing was being done for various categories of labour, like industrial and agriculture labourers, as their consumption baskets are different, the sources said.

This has since been done and the Rural Development Ministry is expected to issue a notification in this regard, they said.

The sources noted that the minimum wage under NREGA was fixed as Rs 100 as on January 1, 2009, irrespective of what the states were paying under Minimum Wages Act. This was more than what was being paid by the states, they said.

Subsequently some states increased the wages beyond Rs 100, leading to a new situation which was discussed by the NAC, prompting Sonia Gandhi to write to Manmohan Singh. 


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