29 November 2004

ILO chief backs job guarantee programme

29 November 2004
The Hindu

ILO chief backs job guarantee programme

By Siddharth Varadarajan

NEW DELHI, NOV. 28. Endorsing the Common Minimum Programme's proposal for a national employment guarantee programme, the International Labour Organisation Director-General, Juan Somavia, said India has the potential to achieve "a real breakthrough internationally" with its promise of "more inclusive" growth.

In an interview to The Hindu , Mr. Somavia said the point of departure for any discussion on poverty and growth had to be "the fact that global policies today are not producing employment."

Calling for a change in the way the success of economic policy is measured, he said: "Today, growth is the main thing but growth is not sufficient because as the example of India and other parts of the world shows, you have jobless growth. So why not change the criterion of success to job creation and basic social protection?"

Once this baseline is laid out, a country should organise its policies to serve this goal. "Of course you want growth, sound macro-management and low inflation for providing employment. But we need the policies to converge towards the goal of employment."

`Enormous potential'

Asked about the proposed Employment Guarantee Act, Mr. Somavia said this approach had enormous potential. The CMP, he said, reflected the general aspirations of the Indian people. On the controversy surrounding the cost of implementing the employment guarantee scheme, the ILO director general acknowledged that implementation would not be easy. "But unless you set objectives, like the CMP does, things won't happen."

India, he said, has the advantage of the size of its economy and market. "So you can plan to generate jobs on the basis of asset creation. You can create three times as many jobs in infrastructure projects if you use labour-intensive technologies, especially on secondary roads and like projects, and you don't have to compromise on the quality or time taken to finish the job. This way, you also train people — they develop skills, their productivity increases."

The ILO had been emphasising an approach that linked job creation, the notion of decent work and fair globalisation to eradicate poverty, he said. Though a commitment to reduce and eradicate poverty was made at the Copenhagen World Social Summit in 1995, the commitment to full employment had disappeared along the way. "The link between poverty and jobs was lost. So, if we are to review the Millennium Development Goals and the poverty reduction strategies of the International Monetary Fund and the World Bank, we have to put employment on the agenda."

National policy needed

While there was room for a variety of instruments from State intervention to private enterprise and micro-credit, Mr. Somavia said the creation of employment and the elimination of poverty required a focussed approach. "You need a national policy rather than saying, `Look how nice this micro-credit programme is doing.' What's missing is the scaling up, the connections. So one tends to have a spotted tiger of success stories — but no national policy."

The focus on employment guarantee would help upgrade the quality and productivity of workers in the informal sector, Mr. Somavia said. "You have enormous creativity with low productivity, which keeps one at subsistence level. If you put support under it — some management knowledge, social protection, including healthcare access, credit and some market knowledge, and these are not major things — productivity will shoot up right away."

He said one had to be realistic about the limits of national policymaking. "The fact is we need fair globalisation. Dealing with globalisation begins at home — you will have successful globalisation only if you have successful localisation. On the other hand, you may have good national governance but if there isn't good global governance — fair rules of the game in finance, trade, migration, workers' rights — then this is no use. If the rules of the game were not fair, the economy "is like a hole from which water continuously drips."

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