Editor’s Note: This is the fifth and final article in a five-article series named ‘The Tales of Toil’ that discusses and highlights the realities, needs and interests of the working class in India.
India has moved forward in leaps and bounds on advancing principles of rights, inclusion and employment security for workers but there is still a lot to be done. Over the last quarter of a century, the so-called ‘trickledown economics’ has not been successful in empowering the poor. Wealth inequality persists due to the marginalised populations being vulnerable because of factors such as social exclusion, lack of basic amenities and market fluctuations. Social-protection programmes and policies are important to tackle these issues. They address multiple aspects of poverty by building resilience against shocks and socio-economic crises, besides enhancing labour-market efficiency and providing income security to the poor. Mechanisms such as direct cash-transfer schemes, social insurance, vocational training, skills development and public work programmes are some of the social protection measures that can potentially provide safety nets for the poor and helps them withstand the brunt of market fluctuations. As per the World Bank (2015), social safety nets reduce the poverty gap by 15% and the poverty headcount rate by 8%. As highlighted by the G20 Forum and the International Labour Organisation (ILO), social-protection systems act as self-regulating economic stabilisers, besides boosting employability and fortifying aggregate domestic demands, and thereby facilitating transition into a more formalised economy.
The economic structure in India is defined largely by the character of its labour force. This labour force is marked by self-employment, heterogeneity and a high level of informality (with over 90% of the total workforce composed of informal workers, who contribute to 50% of the national income!). High susceptibility and low levels of social protection plague these people, who face the problems arising due to the lack of institutional and statutory provisions on various levels for the protection of their interests and needs. More importantly, most preventive and protective legislation for social security are for the organised sector. The few legislative measures for the unorganised sector, such as the Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), are often confined to being ways of providing income and other basic amenities to workers but not preparing them for facing threats and problems with any contingencies. A pioneering policy initiative, on this front, was the introduction of the Unorganised Workers’ Social Security Act (UWSSA) in 2008. However, ten years after the Act was passed, the social-security needs of informal workers and worker in the unorganised sector remain unfulfilled due to significant statutory and structural issues.
To tackle the problem, one must know the loopholes and drawbacks that the current structures have. Let us look at the problems in the Unorganised Workers’ Social Security Act (2008) more closely to see where it can be improved
- The scope and target audience of the Act are very loosely defined, particularly terms such as ‘unorganised worker’ and ‘unorganised sector’, with extensive ambiguities in the way they may be interpreted. Moreover, in defining ‘unorganised workers’, the Act excludes contract-based and agricultural labourers, thereby excluding a large section of the unorganised sector from its coverage. Further, the Act restricts the definition of the ‘unorganised sector’ to enterprises that employ less than 10 workers, without stating any good reason for it and fundamentally violating the Right to Equality between workers in places that employ less than 10 people and those in places that employ more.
- The terms of the Act need to be made more rights-based and obligatory instead of discretionary, in various places.
- The Act only covers a small section of unorganised workers who fall below the poverty line. Most of the unorganised workers in urban areas are not below the national poverty line but are still facing a lot of problems with hardly any social or income security.
- The Act does not address the concerns of women, migrants workers and workers from other vulnerable communities.
- The Act does not allocate any significant institutional power to the social-security boards that it institutes. It restricts these boards to an advisory role. This is a part of the bigger problem of the lack of an efficient mechanism for administering or monitoring the schemes impedes the implementation of the Act.
- The Act does not address the need for a proper funding mechanism, and there is a general lack of any financial plan within the Act itself.
- The Act hardly assigns any responsibility or accountability to officeholders in District Administration, who are supposed to look after the registration of unorganised workers. Moreover, there is hardly any penalty or punitive action for defaulters.
Each of these points must be addressed and resolved by the government. To optimally impact the people who need the policies most, the government must introduce radical administrative, legislative and statutory changes. One of them has to be that of fundamental amendments in the UWSSA 2008, with changes made to address the point on ambiguity of scope and target audiences. Universal access to social-protection schemes for all unorganised workers is also important, though the way to fund this will have to be thought of properly, due to the significant financial burden this may entail on the exchequer. There has been insufficient budget allocation for social-security programmes over the last ten years, with only about 30% budget recommended by The National Commission for Enterprises in the Unorganised Sector (NCEUS) actually allocated. Thus, a social-security fund or dedicated allocation from the main budget for this, with properly drafted financial plans and demarcated budgets, must be created in consultation with the various stakeholders, including the government(s), trade unions , international researcher (such as experts from the ILO) and civil society. The budgetary allocations and provisions must come with increased accountability and responsibility built into the system. Most importantly, there should be a way to have feedback and a dedicated complaint redressal system for this, so that dispute and policy revisions can be sorted out quickly and in an informed manner. Information dissemination of rights and entitlements is also very important and must be looked into.
For basic amenities, I personally feel the need for increasing the scope of policies for universal education and healthcare. Recently the Modi government rolled out the Ayushmaan Bharat scheme, which aims to cover over 10,00,00,000 poor and vulnerable families. This scheme can be extended to include primary healthcare. Provisions aligning with Right to Education (RTE) must be implemented, particularly with the National Child Labour Project (NCLP) for children in the unorganized sector. Recently, many social-security programmes were assimilated into a Direct Benefit Transfer Scheme (2013), allowing for funds to be credited directly into the beneficiaries’ bank accounts. However, what is the use of such a scheme if many informal workers do not even have a bank account, particularly women in low-income households? As per the Global Financial Inclusion Database (2018) by the World Bank, 11% of adults in India do not have their own bank accounts, and almost half of current bank accounts were inactive, as of 2017! Thus, if one wants the cash-transfer schemes to make a difference, making the people financially literate is very important through awareness-building and educational programmes. Further, instead of always providing cash, one can also provide for other forms of facilities, in kind and services. For instance, there could be concessions in healthcare and educational amenities.
Besides all these aforementioned points for the unorganized sector, the points that matter for the organized sector differ slightly in their nature and scope. Some of the major points that I feel are very important include
- Universalisation of the Public Distribution System is of fundamental importance. Inefficiency and corruption in this system must be rooted with strong punitive and preventive measures.
- Strict enforcement of labour laws is needed for the interests of the workers in the organised as well as the unorganised sectors. The Minimum Wages Act must be implemented properly, besides the various other Labour Laws and Codes. Complaint submission, review and redressal must be improved and accessible to the workers in both sectors.
- Universal social security cover or insurance schemes that lessen the burden on the workers, along with mediclaim schemes such as Ayushmaan Bharat, must be put in place, with proper financial plans and consultations with all stakeholders.
- Assured pensions that are enhanced and in tune with the demands of the times for the entire working population would go a long distance in incentivizing the labour force and possibly help us in transitioning towards a more formal economy with assured benefits for workers.
- Compulsory registration of trade unions within a fixed period of time from the date of submitting application, besides the and immediate ratification of ILO Convention C 87 and ILO Convention C 98 is important, as is the addition of teeth to the framework for the functioning and the powers of trade unions, particularly with respect to employers.
This comprehensive plan for the reform and virtual overhaul of provisions for workers could go a long way in representing the interests and needs of workers, both in the organised as well as the unorganised sectors.
In Conclusion
I would like to end this article with the sincere hope that the various stakeholders, including the government(s), bureaucrats, trade’ unions and employers, come together in creating an environment conducive for the welfare, good living and sustainable work for the workers; an environment that is built on the principles of inclusivity, empowerment and representation of workers; for, as Senator Bernie Sanders said, “if we are going to reverse the race to the bottom, workers must have the right to engage in collective bargaining.”