Overregulation is one of the many reasons why the government investments in skilling are not leading to desired results
By Chocko Valliappa
A piece of news that caught the eye was the recent announcement that as part of the Pradhan Mantri Kaushal Vikas Yojana (PMKVY) 3.0, the government had budgeted Rs 948.9 crore during FY21 to train 8 lakh workers. That translates to about Rs 12,000 per worker to be skilled.
The question is: Who will carry out the skilling and what are the modalities?
First, some background. It has been five years since the PM launched the Skill India Mission. The PMKVY was a skill development initiative launched by the government in 2015 that focused on recognition and standardisation of skills through centres set up by private training partners. These partners invest in rented premises, infrastructure and manpower, and then go through a lengthy approval process. The waiting period for student trainees to get admitted to a typical 4- to 6-month programme is as much as 8-10 months. Often, the centres have to wait for six months to get their next batch of students—a colossal waste of time and finances.
The government invests about Rs 4,000 crore on its skilling mission annually and much of it is managed through the National Skill Development Corporation (NSDC). One of the pillars of the skilling initiative is industrial Sector Skill Councils (SSC). But the initiative has progressively lost its way because of poor implementation. We have not really seen the new skilled workforce find a place in industry or improve their earning capability.
Rule-bound: Overregulation is one of the many reasons why the government investments in skilling are not leading to desired results. The focus is on rules and not on the big picture of skilling. For example, a skill centre with two classrooms—one 395 square feet and the second 405 square feet—is bound to be rejected by the NSDC due diligence team as one of the classrooms falls short of the specified 400 square feet by 5 square feet.
The training partners face myriad challenges. Payments are held up often affected by typical bureaucratic malaise. This affects their viability.
On the positive side, interactions between SSC, industry employers and private training partners have resulted in some positive moves. For instance, programmes like Recognition of Prior Learning (RPL) and Short-Term Training (STT) for in-service workers are good. However, the economic slowdown and the Covid-19 pandemic have depressed the job market and salary levels. Even as no new industries are being set up in the interiors of the country, the newly-skilled labour force there is unwilling to move to where the jobs are.
What can be done?
So, what happens to the PMKVY 3.0? The cynic in me says either the government will award contracts to private players and get them to rush through the skilling process or the funds will lapse.
However, there is much that can be done easily. Industry could approach the respective SSC and publish skill-wise demand for workers on a public platform. Based on their specific needs, skilling firms then impart training at competitive prices. The certified skilled manpower details can be published on the SSC platform for industry to hire. Industry could access a pool of skilled workers from training providers for internship and at the end of 4-6 weeks offer jobs to suitable candidates.
To solve the payment issue, the NSDC could change the system. For each job provided to a worker skilled under the PMKVY, the employer could get an advance job creation credit of Rs 12,000 to be offset against the Provident Fund contribution for the initial 6-12 months or advance tax credit for firms with less than 20 employees. The skilling centres get paid directly 50% on employment and final payment in six months.
To maintain quality of skill training providers, a process to track trained employees and their progress can be set up. Skilling firms with a good placement track record can be rewarded rather than punishing those with low placement records. This will be a right step in aligning the skill training mission for jobs.
The author is CEO, Vee Technologies, and vice-chairman, Sona Group of Institutions, Salem