Lecture 23

LESSON 23 Principles of External and Internal Differential Rewards and Incentives Chapter 8: Introduction To Wage incentives in India Learning Objective: •

To understand the Prevalence of Wage Incentive Schemes in India

•

To know the Need for introducing Wage Incentive Schemes in India

Prevalence of Wage Incentive Schemes in India In a country like India, the role of financial incentives as a primary tool for motivating workers cannot be over-emphasized. Besides, the necessity of raising the productivity of Indian labour is also getting due attention. In this context, the First Plan recommended the introduction of incentive schemes to promote a more efficient working of industries with due safeguards for the interests of workers through the guarantee of a minimum wage and protection against fatigue and undue speed-up. The Second Plan recommended that the earnings beyond the minimum wage should be related to results, and that workers should be consulted before a system of payment by results was introduced in an establishment. The Third Plan emphasized the need for higher productivity and reduction in the unit cost of production. It put the responsibility on management to provide the most efficient equipment, correct conditions and methods of work, impart training and create suitable psychological and material incentives for workers. The Study Group of the National Commission on Labour has recommended that "under our conditions, a wage incentive is concerned with an effective utilization of manpower which is the cheapest, quickest and surest means of increasing productivity. The only practicable and self-sustaining means of improving manpower utilization is to introduce incentive schemes and stimulate human efforts to provide a positive motivation to greater Output." Need for introducing Wage Incentive Schemes in India The need for introducing wage incentive schemes in India has been felt on the following grounds:

(i) The efficiency of the Indian worker is very low, and needs to be raised. Wage incentives can play an important part improving his efficiency. (ii) The average Indian worker is financially very poor. Financial incentives therefore are likely to tempt him to work better. (iii) India is at a low level of technology, and wage incentives can help in promoting the use of electronic devices. (iv) A proper application of wage incentive schemes can so affect the prices that the community would be benefited. (v) In the national interest, it is felt that wage incentive schemes should be applied to all economic activity. Tutorial Activity 1.1 Scenario Agriculture still provides the bulk of wage goods required ... Moneylenders, banks, government incentive schemes, friends, relatives ... and analysis of case studies of successful ... AGRICULTURE has always been INDIA'S most important economic sector. In the mid-1990s, it provides approximately one-third of the gross domestic product (GDP) and employs roughly two-thirds of the population. Since independence in 1947, the share of agriculture in the GDP has declined in comparison to the growth of the industrial and services sectors. However, agriculture still provides the bulk of wage goods required by the nonagricultural sector as well as numerous raw materials for industry. Moreover, the direct share of agricultural and allied sectors in total exports is around 18 percent. When the indirect share of agricultural products in total exports, such as cotton textiles and jute goods, is taken into account, the percentage is much higher. Dependence on agricultural imports in the early 1960s convinced planners that India's growing population, as well as concerns about national independence, security, and political stability, required self-sufficiency in food production. This perception led to a program of agricultural improvement called the Green Revolution, to a public distribution system, and to price supports for farmers. In the 1980s, despite three years of meager rainfall and a drought in the middle of the decade, India managed to get along with very few food imports because of the growth in food-grain production and the development of a large buffer stock against potential agricultural shortfalls. By the early 1990s, India was self-sufficient in food-grain production.

Agricultural production has kept pace with the food needs of the growing population as the result of increased yields in almost all crops, but especially in cereals. Food grains and pulses account for two-thirds of agricultural production in the mid-1990s. The growth in food-grain production is a result of concentrated efforts to increase all the Green Revolution inputs needed for higher yields: better seed, more fertilizer, improved irrigation, and education of farmers. Although increased irrigation has helped to lessen year-to-year fluctuations in farm production resulting from the vagaries of the monsoons, it has not eliminated those fluctuations. After independence in 1947, the cropping pattern became more diversified, and cultivation of commercial crops received a new impetus in line with domestic demands and export requirements. Nontraditional crops, such as summer mung (a variety of lentil, part of the pulse family), soybeans, peanuts, and sunflowers, were gradually gaining importance. There are large disparities among India's states and territories in agricultural performance, only some of which can be attributed to differences in climate or initial endowments of infrastructure such as irrigation. Realizing the importance of agricultural production for economic development, the central government has played an active role in all aspects of agricultural development. Planning is centralized, and plan priorities, policies, and resource allocations are decided at the central level. Food and price policy also are decided by the central government. Thus, although agriculture is constitutionally the responsibility of the states rather than the central government, the latter plays a key role in formulating policy and providing financial resources for agriculture. Agricultural Structure of India Field crops are planted on about 45 percent of the total landmass of India. Of this cultivated land, almost 37 million hectares were double-cropped, making the gross sown area equivalent to almost 173 million hectares. About 15 million hectares were permanent pastureland or were planted in various tree crops and groves. Approximately 108 million hectares were either developed for nonagricultural uses, forested, or unsuited for agriculture because of topography. About 29.6 million hectares of the remaining land were classified as cultivable but fallow, and 15.6 million hectares were classified as cultivable wasteland. These 45 million hectares constitute all the land left for expanding the sown area; for various reasons, however, much of it is unsuited for immediate cropping. Expansion in crop production, therefore, has to come almost entirely from increasing yields on lands already in some kind of agricultural use. Topography, soils, rainfall, and the availability of water for irrigation have been major determinants of the crop and livestock patterns characteristic of the three major geographic

regions of India--the Himalayas, the Indo-Gangetic Plain, and the Peninsula--and their agroecological subregions. Government policy as regards irrigation, the introduction of new crops, research and education, and incentives has had some impact on changing the traditional crop and livestock patterns in these subregions. The monsoons, however, play a critical role in determining whether the harvest will be bountiful, average, or poor in any given year. Problem Definition The farm management is the field closely related to agro-economics. There is no doubt that farmers adopting new technology are quite conscious about the management of their farm. However, there is general apathy about the farm management amongst the farmers, Agroscientists and the policy makers. Being a relatively young since, no much attention is post to it. There may be some sound reasons for this. However, with changing scenario in agriculture, the need for guiding farmers in management of their farms assumes significance. In any business proposition, management has to play a significant role. In other sectors of the economy, ‘management’ has become a catchword. In recent years, the irritations giving training in ‘management’ are increasing by leaps and bounds. There is good demand for ‘managers’ trained in these institutions. Now, the technical persons having engineering and other vocational background are turning towards MBA and allied courses. However, with rare exceptions, there are no such Institutions for training persons in farm management. One of the reasons for this may be that our farming is relatively a small-scale farming and the scattered one. In agriculture sector, there is need for guiding the farmers in this economic aspect. Aim The aim of our project is to design and develop an agricultural information system, which will provide an optimum production plan for a given farm taking into account the resources and the limitations in which it is being operated. Objectives The main objectives of the project are as follows: To provide information to the farmers related to agriculture and farm management To develop a centralized, systematic and a single system to provide all kinds of information needed by farmers To help farmers in decision making in farming business To provide a geographical view of the various agricultural lands in the country to facilitate easier information retrieval

To focus and provide various decision making tools for production of crops Requirement Analysis Our agricultural scene is a changing rapidly since the mid-sixties when we experienced the ‘Green Revolution’. It was followed by the ‘White Revolution’, which brought in the flood of milk in the country. Now, we are on way to ‘Yellow Revolution’ i.e. revolution in fruit production. An important fact behind these revolutions is the economic consideration. Farmers have been adopting the new technology in agriculture and related fields mainly because of these innovations pay more all compared to their tradition crops. If we analyze, this changing scene in agriculture, we can notice that the traditional agriculture. Which was a ‘way of life’ for our farmers is now becoming a ‘business proposition’. In the traditional farming there was no much change in the cropping pattern, cultivation practices etc. It was based on the experiences transmitted from father to the son. However, with the developments taking place due to five-year plans and technologies developments in agriculture, traditional farming is changing into modern farming. Traditional farming is slowly becoming obsolete and uneconomic. Traditional farming was more or less self-sufficient. Now farming is becoming market oriented. The needs of the farmers are increasing. He has to purchase many things such as high yielding seeds, fertilizers, pesticides, machinery etc. from the market. As a result, his investment and financial needs are increasing. Naturally, he has to produce and get income to meet the costs and also to make some profit. Thus, the costs, returns, markets, and profits of the enterprise become significantly important. The considerations of cost of production, income and profitability are summing significance. This is nothing but ‘Agro-economics’. With increasing population, rapid urbanization and growing export markets, the demand for farm products is increasing and is likely to increase in the near future. However, the competition is also likely to increase. The consideration of economic aspects in the production process is inevitable. Decision Making in Farming Business Decision making in any business largely depends on the nature of business. To understand decision-making in farming, it is necessary to know the nature of Indian farming. Nature of Indian Farming: Indian farming is basically a subsistence farming. But due to new technological developments in all the areas of production, productivity of crops and livestock has increased substantially, total

production has increased several times and marketable surpluses with the farmers have also increased. As a result farming has assumed commercial proposition. Indian farming is a diversified and mixed type of farming. The farmers grow 5-6 crops or even more on their farms. 1. To meet their family requirements To suit their soils on the farms and considering availability of resources including irrigation and market facilities. They also follow mixed farming, that is they keep few milk animals and follow dairy and also undertake sheep or goat keeping poultry keeping, etc. to supplement incomes from crop production. Therefore decision making on such farms is more difficult and complex than on specialized farming. Indian farming is a family type farming. Farm family provides major part of labour and also provides some capital. 2. Role of Farmers: Indian farmer plays following four rules simultaneously: He is an entrepreneur He is a Manager He is a Financer He is a Labourer or Worker, He takes decisions in two capacities as an entrepreneur and a manager. 3. Area of decision Making: There are four major areas of decision making: Production of crops and livestock. Acquiring inputs. Obtaining credit. Marketing his produce. Production: The decisions related to production activity are:What to produce ? i.e. selection of crops and live-stock activity. Whether to have dairy, goat keeping or poultry or their combination. How to produce ? Adoption of suitable technology ; whether to continue old technology or use new technology or combination of both. How much to produce ? To consider family requirements in respect of foodgrain, vegetable, spices, fruits, milk, etc and also think of producing marketable surpluses. In that case, think of

demand supply position availability of market and prevailing prices. This will also apply to production of cash/commercial crops. Acquiring inputs: In modern commercial farming, wide range of inputs are required. They include seeds of high yielding and hybrid varieties, fertilizers, pesticides, plant growth regulators (hormones), improved implements and machinery, etc. There are commercial and specialized agencies dealing in these inputs. The farmer has to take decision and make choices relating to From whom to buy ? At what price to buy ? How much to buy? Whether to buy on cash or on credit ? Obtaining credit: Although the farm family supplies some finance, it is not adequate considering larger financial requirements of modern agriculture. Therefore, farmer has to borrow from outside sources. In this connection he has to take following decisions. There is risk in borrowing. How much to borrow ? From whom to borrow ? There are some alternative sources viz. Moneylenders, banks, government incentive schemes, friends, relatives, traders, etc. He has to make right choice – At what rate to borrow ? What security/mortgage to offer ? How repayments to be made ? How to face risk situation ? Marketing the produce: When surplus produce is obtained or created, its disposal or marketing advantageously becomes necessary. Following decisions are involved in the marketing of farm produce. Where to sell ? This is the most important decision because in rural areas big, wholesale and organized markets are limited. As far a individual farmer is concern, his produce is of small quantity, he has no transport facility, there are no good roads to go to distant markets. The farmer has to make choice within limited alternatives. Whom to sell ? There are various types of agencies such as villager trader, wholesale cum commission agents, co-operatives, government (for selected commodities ). He has to make choice from among them. When to sell ? Immediately after harvest when pries are the lowest or wait for better prices. He is also constrained by cash requirements for family expenditure. He has to take decision under most unfavourable situation. At what price to sell ? Here the position of farmer is very vulnerable. He has almost no choice. Prices in organized markets (Regulated markets ) are fixed by open auction and he has to accept the price quoted by the highest bidder even this price may not be remunerative. In unorganized markets, prices are fixed by traders and farmer is hardly consulted. He has very limited scope for decision making.

Problems faced by farmers As indicated above, there has been a technological break-through in agriculture in recent years. New non-traditional crops, new varieties of crops, new methods of cultivation are coming in very fast and farmers are adopting the same. A large number of farm products are being produced for exports. However there are specifications about the size, color, quantity, taste, packaging etc. Which farmers should know. Farmer has to consider all these aspects and consider the costs and returns before entering into the venture. Farmer has several enterprises (such as crops, dairy, and poultry) on the farm. He has to consider the economics of each enterprise separately also of the farm as a whole. It helps in decisionmaking and proper planning of the farm. Now, the time has come that every activity on the farm has to be viewed from the perspective of economics. Along with the adoption of new technology in farming, the problems faced by the farmer’s fare also increasing. There are problems of soil and water management, choice of crops, technical know-how, pests and diseases, natural hazards, marketing, finance, surplus production, price fluctuations and so on. In finding the solutions for these problems, economic criteria are to be applied. India is a vast country with varied climate, soils, and ecological conditions. In addition to this, individual farmer is having his own set up of resources and socio-economic situation. In solving the problems of individual farmers all these situational factors are to be taken into account. An important ray of hope, which one can notice in this complex changing scenario of agriculture, is that new generations of farmers who are more educated, young and energetic have taken up to this enterprise. In addition, many non-farming community entrepreneurs are also attracted towards agriculture. They are very keen on getting more knowledge about the new technology. Many of them are innovative and experimenting of their own. Naturally, they are more economics oriented. Our system as a solution to the above problems We propose an agriculture information system for guiding the farmers in this economic aspect. The subject matter covers several aspects such as decision-making, farm planning, resource planning (land, labour, capital), farm costing, farm accounting, marketing, and analysis of case studies of successful farmers. The use of efficiency measures to evaluate the enterprise is also an important aspect of our system. The statistical tools such a production function, linear programming are being used to get an idea about the resource. We intend to provide an optimum plan for a given farm taking into account the resources and the limitations in which it is being operated. Basic Components identified

The various components/entities that we identified after our requirement analysis phase are described below in common language.

Entity

Brief description

Functions

FARMER

An individual person who cultivates land for his source of income

A farmer is involved in the activities of agricultural production, marketing, farm, soil and water management

CROPS

Farmers grow different crops. Various types of crops are sown all over India depending on a number of circumstances

Decision-making is involved as to where which crop should be sown.

SOIL

Crops are sown in the soil. Various types of soil are found all over India like alluvial soil, clay soil etc.

Decision making is involved as to in which soil which crop should be sown

IRRIGATION FACILTIES

They are used to grow crops. Farmers employ different irrigation facilities depending on number of circumstances

Decision-making is involved as to in which area for which crop what irrigation facilities are to be used.

WEATHER CONDITIONS

There are different weather conditions like temperature, humidity etc. in different parts of the country depending on the geographical situations.

Decision making is involved as to in which climatic conditions which crop should be sown

FERTILIZERS

This entity is used by the farmers to increase their productivity

It enhances the fertility of soil and thus results in increased production.

AGRICULTURAL TECHNOLOGIES

The farmers to make farming more convenient use this entity.

It helps the farmers in various agricultural tasks

DISEASES

The plants suffer from

It harms the crop and

this entity resulting in less production.

decreases the over all production.

PESTICIDES & INSECTICIDES

This entity is used by the farmers to get rid of various crop diseases and pests

It removes the pests, insects etc that attack the crops

AGRICUTURAL POLICIES AND SUBSIDIES

The government for various types of crops makes this entity for the goodwill of the farmers.

It helps farmers to increase their income level.

Relationships Farmers sow crops Farmers buy fertilizers, agricultural technologies, pesticides & insecticides ,irrigation facilities to enhance his production Crops require a particular type of soil, weather conditions, fertilizers, insecticides & pesticides, irrigation facilities and agricultural technologies. Crops suffer from diseases. Pesticides & insecticides remove diseases. Farmers use agricultural policies and subsidies. There are different policies for different types of crops Software Development Methodology We plan to carry the design and implementation of this project in a completely step-by-step manner. The entire project is divided in the following phases Phase 1 Study and Analysis Phase In this phase we shall visit various websites related to agriculture in India and make a thorough study of several books on agriculture. we also plan to interact with farmers so as to know their problems and to collect information regarding our project. We shall study the complete agricultural production process and analyze the drawbacks of the existing system and propose our system as a solution to them.Also we shall study the concept of databases and other material required to design and develop our system Phase 2 Design Phase Identification of entities and their relationships Development of logical n conceptual models

Development of ER model for the proposed system Defining hardware and software requirements Phase 3 Coding phase Implementation of system through actual code Phase 4 Implementation and Testing This phase will involve implementation of our system and testing it with various test cases n data sets. We shall follow the SDLC model for the development of the proposed system. Gantt Chart (14 WEEKS)

ANALYSIS AND STUDY (4 WEEKS) DESIGN (4 WEEKS) CODING (3 WEEKS) IMPLEMENTATION TESTING (3 WEEKS) Tutorial Activity 1.1 Rewards and Incentives

&

What are Strategic Rewards? Let us study in detail about the same in the case below that they "are not just about money any more." In today's competitive employment market, employers know that finding, hiring, and keeping skilled workers is not just about money any more. To attract, manage and retain an effective and efficient workforce, Federal employers are learning to think in terms of broader strategic rewards. This means rethinking how we can offer talented and highly-skilled employees the rewards that will help keep them engaged and focused on meeting strategic objectives. What are strategic rewards? How does performance management fit into a strategic rewards framework? What agencies are using a strategic rewards perspective? What are strategic rewards? Strategic rewards embrace everything that employees value in the employment setting, and the term refers to the complete bundle of all employee reward elements. What makes these rewards strategic is the care employers must take to align their design and effects with strategic objectives. One view of Strategic Rewards as depicted here shows four quadrants of a strategic rewards framework: Compensation Base Salary Variable Pay Job Evaluation Performance Management Paid Time Off

Benefits Health Care Retirement Savings Other Insurance

Development and Learning Training Career Development Learning Experiences Succession Planning

Work Environment Work/Life Balance Leadership Performance Support Organizational Climate

The top two quadrants, compensation and benefits, cover the areas that we traditionally think of as rewards the employer provides. These are sometimes referred to as transactional rewards because they include the tangible results of the agreement between the employee and employer. In this agreement, or transaction, the employee agrees to provide time, labor and skills in return for salary and benefits. Therefore, these rewards are readily viewed in terms of having a monetary value, such as the employee's base salary or the Federal Employees Health Benefits Program. Transactional rewards play an important part in an employee's decision about where to work and whether to stay with an organization.

The bottom two quadrants, development and learning and the work environment, cover areas that are increasingly recognized as critical contributors to employee satisfaction. They are sometimes referred to as relational rewards because they tend to represent the relationship (vs. the transaction) between the employee and employer. They are important additional rewards that can significantly enhance an employee's desire to remain with an organization. These rewards: Can emphasize the importance of the employee to the organization; Can influence the employee's sense of loyalty; Are rarely seen in terms of their cash value, but can have an equally important impact when an employee is trying to decide whether to accept other employment or remain with an agency. Represent those program areas where agencies have the greatest amount of flexibility to design programs specific to the needs of their employees. To many employees, a supportive and engaging work environment is at least as important as health care benefits and pay. For example, dependent care support, flexible work schedules, opportunities to telecommute, flexible leave programs, meaningful employee involvement, and well-trained supervisors providing quality leadership may make all the difference in the world when a person with a hard-to-find skill is considering your job offer or when an employee with valuable institutional experience is considering a competitor's offer. How does performance management fit into a strategic rewards framework? The performance management policies, programs, and practices that agencies carry out play an essential role in strategic rewards. Of course, in the Federal Government, performance management includes not only planning, monitoring, and rating performance, but also developing and rewarding performance. Performance management is listed specifically in the compensation quadrant to signify that credible measures of performance and using monetary rewards to reinforce results achievement are essential parts of effective performance-oriented pay. In addition, our General Schedule pay system includes a pay progression feature where within-grade pay increases are contingent on acceptable performance and where exceptionally high performance can be recognized with a quality step increase. Good performance management practice also plays a vital role in relational rewards. For example, one of the strategic reward quadrants is also one of performance management's key processes–development. If managers do not develop employees, they are not effectively managing employee performance and are not making best use of strategic rewards. Through monitoring performance, providing feedback, coaching for improvement, and identifying developmental needs, managers create a learning environment that can be enriching and rewarding for employees.

Performance management also plays an important role in the work environment quadrant. Studies conducted by the Hay Group, the Gallup organization, and others, show that good performance management practices create rewarding experiences for employees. For example, when surveyed about work environment issues, employees in highly-productive work groups reported high levels of agreement with the following statements: I know what is expected of me at work. (planning) In the last 6 months, someone at work has talked to me about my progress. (developing) In the last 7 days, I have received recognition or praise for doing good work. (rewarding) What agencies are using a strategic rewards perspective? Many agencies have adopted this approach to help them manage their workforce. The Defense Contract Audit Agency (DCAA) and the National Credit Union Administration (NCUA) use strategic rewards to help attract and retain skilled employees. As the Defense Department's audit agency, DCAA's human resources managers were faced with the challenge of hiring 600 entry-level auditors within 1½ years. To make the agency more attractive to potential hires, managers reinvented the way they recruit. In addition to streamlining their recruitment process, they also put emphasis on the training new hires will receive, the tuition reimbursement program, recruitment bonuses, and a 3- to 5-year career ladder. In addition to actively recruiting new employees, DCAA's managers worked to retain its current workforce. To do this, it created a work environment of trust, teamwork, and mutual respect by using effective communication and leadership at all levels. NCUA implemented a merit pay system that links annual pay raises directly with employee performance appraisals. The agency uses a variety of awards to recognize its employees for their contribution to its organizational goals and objectives. Using the strategic rewards approach, NCUA has created programs that allow its employees to work from home, receive reimbursement for certain home-office expenses, participate in one of three flexible work schedules, and receive travel bonuses (i.e., a cash award to recognize employees who volunteer to be in a travel status for more than 50 days a year). NCUA uses its strategic rewards as part of its recruitment program. The agency works hard to create a work environment that is family-friendly as well as challenging. For additional information on NCUA's strategic rewards programs. These are only two examples of the ways that Federal agencies are reexamining the way they think about, design, and deliver the wide variety of things about the work situation that employees find rewarding. Tutorial Activity 1.2 Incentives for inclusion By Lalitha Sridhar

Under the Icebreaker scheme, an employer hiring a person ... can get the person’s wage paid for ... to all businesses, why not disability incentives and reservations ... At least 7 million disabled Indians are waiting for a job. But only 0.4% of employees in India’s top 100 corporate houses are disabled. India’s first Draft Incentives Policy for the Disabled has just been presented to the government. It demands serious attention from the public and private sectors to the question of incentives and subsidies for the support and employment of the disabled. A host of NGOs, senior bureaucrats, representatives from industrial associations and chambers, financial and corporate taxation experts and mediapersons recently congregated for the first time in order to present a Draft Incentives Policy for the Disabled to the Government of India. Key organisations and activists from the disability sector have come together to place the pioneering document before the government, in time to lobby for its adoption by the Union Budget of 20042005. To prepare the ground, two critical research studies were commissioned. Firstly, incentive policies in select European countries to promote the employment of disabled people were analysed. Secondly, existing incentive policies in the Indian corporate sector promoting social and economic causes other than disability were studied. While 5-6% of India’s population is disabled, less than 1% of children with disability receive education of any kind. Even though the first Special Employment Exchange (SEE) for the physically disabled was established in Mumbai in 1959, and in 1977 the Government of India reserved 3% of vacancies in identified jobs in government and the public sector, since the setting up of the first SEE more than 40 years ago, only about 1,00,000 disabled persons have been employed. Says Javed Abidi, Director of the National Centre for Promotion of Employment for Disabled People (NCPEDP), the leading advocacy group credited with moving a recalcitrant government to include disability in the 2001 Census, "There has been a sustained and overall neglect of the needs of disabled people in India." This Incentives Policy initiative is being spearheaded by the three Disability Legislation Units set up in Chennai, Mumbai and Guwahati by the NCPEDP, which also oversees the National Disability Network to advocate better employment, awareness, legislation, education and access for disabled people. Asks Rajul Padmanabhan, Deputy Director of Vidya Sagar (formerly the Spastics Society of India, Chennai), "When tax benefits can be given for exports, for infrastructure, for setting up new units in backward areas etc, why can tax benefit not be given for employment of persons with disability? According to the Persons with Disability Act, 1995, the government should give incentives to employees both in public and private sectors to ensure that at least 5% of their workforce is composed of persons with disabilities. But the implementation of this well-intentioned piece of

legislation leaves much to be desired." Weighted deduction is allowed for employment-generation and scientific research, subsidies are given to sugar, fertiliser, horticulture and plantations -- but not for employment of disabled persons. Rebates on interest on loans, various subsidies, duty exemptions, reservations in land allotment and waiver of charges like electricity are other areas where disabled people can benefit from incentives, recommend the studies. In developed countries, disability is tied to the longevity of the population. In the EU, for example, the vast majority of disabilities have been acquired in middle or old age -- 63% of people with disabilities are aged 45 or more; almost 40% of them are age 55 or older. In India, on the other hand, one in every 10 children is disabled. Nevertheless, some problems appear to be universal. As many as 52% of people with disabilities are economically inactive in the EU, as compared with only 28% of non-disabled people. Activists believe it is necessary to understand established models that can be replicated in India. Unlike many people in developing and transition countries, the majority of workers in Europe are engaged in formal employment. Benefit systems involve major investments in funds and manpower of the kind hardly available in India. There are important lessons we can learn from Europe. For example, even though Denmark does not define what constitutes the disabled population, it focuses on compensation for individual needs. Persons with disabilities have access to a large number of measures to support them in the event of unemployment and to encourage them to re-enter the job market. Disability counsellors are assigned to each regional employment agency in an effort to better match disabled individuals with jobs in the open labour market via guidance, training and recruitment. The Dutch concept of Flexjobs allows for 33, 50 or 67% subsidy of wages in the event of a disabled employee taking leave from work. This not only encourages workers to undertake continued education or rest, if necessary, but provides temporary employment for (disabled) substitutes. The subsidies are provided by the State to multiply jobs of this nature rather than put jobseekers on disability pension. ‘ Lenient jobs’ is another supplementary employment scheme: a disabled person with 33% working ability, for example, receives 1/3 of the minimum wage. Under the Icebreaker scheme, an employer hiring a person with severe disability can get the person’s wage paid for during the first 6-9 months. Overall, the report says, the emphasis is on mainstreaming and that is what we need to emulate. In India, the Persons with Disabilities Act has completely left out the private sector. Experts ask that when taxes and other laws are uniformly applicable to all businesses, why not disability incentives and reservations?

But, says Ravi Shankar, Vice-President of Flash Support, an organisation that hires disabled people, "I don’t mean to demean incentives but the disability sector can and should identify areas where their services are most suited and become available for them in a proactive way. Industries in recession will not appreciate carrot-and-stick policies. Companies in the IT (Information Technology), telemarketing and BPO (Business Process Operations) sectors are particularly suited for employing disabled persons. Many offer workfrom-home options. A particular strength of the disabled is that they are loyal employees." The IT industry has attrition (turnover of personnel) rates of 30-40%, a problematic issue for corporates. Adds Anuradha Parakkat, Director of the Confederation of Indian Industry (CII), "Corporates will be more interested in those who can deliver. One good disabled recruit makes a far better impact than any number of policies." Countered Poonam Natarajan, Director of Vidya Sagar, "We all know about recession but let not the disabled be the last in the queue. I wouldn’t aspire to be a singer because I cannot sing. Similiarly, the fact that we have to match our ability to the available job opportunities is true for all of us -- not just the disabled. Also, if somebody gives me an opportunity, I can find ways and means of doing what is required of me." An example can be found in Varada Kutti, a chartered accountant who was rejected when he applied for a job as a clerk by the State Bank of India, and now runs a firm that audits some of their branches. Activists express concern that persons with mild disability are being neglected. Also, the vast population of the rural disabled do not have access to technology and jobs that involve its application. The government’s policy of categorising disabled people draws criticism too. Says Padmanabhan, "A person with cerebral palsy cannot be slotted into particular options and slotted into ‘can do’ or ‘cannot do’ generalisations. It doesn’t work like that at all. The abilities of disabled individuals -- even within victims of cerebral palsy -- are often unique. Individualising is happening at NGO levels anyway. Incentives provide a larger, broader access." The next generation of corporate managers can be sensitised by introducing disabilities as a section in human resource management studies. Two things are necessary: shift focus to employability of the disabled and, at the same time, provide industry with incentives to hire them. Says Giridhar, wheelchair-bound advocate with the Forum for Just Law, "Percentages mean nothing! Three per cent of 20 posts? Disabled people fall out of the net because the number is not even tangible. An absolute number of positions is what is required, with options of either that number or a certain percentage, whichever is lower perhaps. As a disabled person, I even have to pay a higher insurance premium!"

Recommends Prakash Kuruvilla, Regional Head of HSBC (the Hongkong and Shanghai Banking Corporation), "The Apprentices Act can be explored and amended to include the disabled too. There is tremendous demand for people who can be hired with no strings attached. Many companies file ‘nil’ returns in the Compulsory Notification of Vacancies Act because they are afraid of the kind of pressure employment exchanges will exert on them. Headhunters assume we won’t be interested in the disabled but many who join as apprentices prove themselves very well. We have to accept the reality that with outsourcing, very few permanent jobs are coming out." A 1999 study of 100 ‘top’ corporate houses in India showed that the average percentage of employees with disabilities is a dismal 0.4%. The National Sample Survey of 1991 (results last available) itself said that there are 7 million employable disabled people waiting to get a job. If the Draft Incentives recommendations are accepted in whole, or part, by the government, some urgently needed difference could be made.