By Shamindra Nath Roy & Manish
The relief package announced by the finance minister on March 26 included a direction to all states, presumably an exercise of its power under section 60 of the Building and Other Construction Workers Act, 1996, to use the Rs 31,000 crore in funds available with their welfare boards to provide assistance and support to the mostly casual (83.8% as per PLFS 2017-18) workers to protect them against economic disruptions. The labour ministry had previously estimated that about Rs 52,000 crore was available with states. But, whatever the amount, this assistance is likely to be constrained in practice by low worker registrations, limited capacity for expenditure, significant variations across states, and issues of interstate migrants. This will affect the ability of central and state governments to ensure wages to migrants, many of them construction workers.
On paper, the welfare framework for construction workers is simple. States collect a cess from construction projects, register construction workers, and design schemes to use the funds collected for their welfare. But states have not been very good at spending this money. The current crisis is an opportunity for them to improve their record, but this will need significant changes in practice.
First, the overall registration of workers—only registered construction workers benefit from the welfare schemes—itself has been unsatisfactory. Figures from the Union Ministry of Labour and Employment show that 3.24 crore workers (estimated at 3.5 crore currently) were registered across the country as of end-2018, which represented about 60% of the construction workforce in India, as per PLFS 2017-18. Much of this progress is recent, after monitoring by the Supreme Court; registration increased by more than 50% between 2015 and 2018. Worryingly, field studies at labour chowks show that many workers remain unaware of this benefit.
But even for the limited subset of registered workers, the benefit would depend on the state in which they are registered, since there is wide variation in the availability of cess funds across states. In 2018, the last year for which a state-wise breakup is officially available, half of the collected cess amount was in just six states—Maharashtra, Karnataka, Delhi, Tamil Nadu, Uttar Pradesh and Madhya Pradesh. Conversely, six states—Tamil Nadu, Uttar Pradesh, Madhya Pradesh, Odisha, Rajasthan and West Bengal—have 54% of the registered workforce, but only 32% of cess funds collected.
Thus, welfare boards in states have differing capacities to offer assistance. For instance, Chhattisgarh’s board would go bankrupt if they paid workers even the central minimum daily NREGA wage of Rs 202 for the lockdown period, while Maharashtra’s would have surplus funds. More importantly, the capacity to spend varies: By 2018, just six states—Uttar Pradesh, Madhya Pradesh, Odisha, Rajasthan, West Bengal and Kerala—accounted for 53% of the cess money utilised. The accompanying graphic shows that very few states are in the ideal upper-right quadrant, with large numbers of registered workers, and a substantial expenditure per worker. Chhattisgarh is one of them, but its construction activity is too low for sufficient cess collection.
Finally, there is the issue of migrant workers, many of who made desperate attempts to walk long distances home after the lockdown, who constitute 42.7% of the urban construction workforce (Census 2001). The accompanying graphic shows that the largest concentration of migrant construction workers is in Maharashtra, Gujarat (low registration and low expenditure), undivided Andhra Pradesh, Haryana (high registration, low expenditure), Chhattisgarh and Madhya Pradesh (high registration, high expenditure).
Many workers walking home told journalists that they had little access to social security at work. This is corroborated by fieldwork from several states showing that boards are reluctant to register migrants, and registration processes are onerous. Thus, it is unclear if migrant workers can access the finance minister’s offered benefits in time—before hunger, the virus, or the long trudge to their hometowns gets to them.
How, then, do we mitigate this problem?
First, the Centre can use the expertise of the Central Building and Other Construction Workers’ Advisory Committee to play a proactive role in coordinating amongst states, especially sending and receiving migrants. It can facilitate sharing beneficiary lists and funds between these states, perhaps through interstate MoUs, to be used in combination with ground-level targeting, involving civil society and employers, to ensure that all workers get access to some minimum sustenance for the period of the lockdown. A quick start can be made with high registration states that have a demonstrated capacity to spend.
Second, states—labour departments and welfare boards—must do much more to implement the law. Much remains to be done to convey the benefits of registration, and to make it easily accessible. The quarantine camps for migrants are, ironically, an opportunity to disseminate information, and even register such workers.
One can only hope that this crisis, having made their struggle visible, will improve construction workers’ lives a little, and shame states into ensuring that any future disaster does not leave them, literally, on the roads.
Authors are researchers at the Centre for Policy Research, New Delhi. Views are personal
