NEW DELHI: With millions of daily wage construction workers likely stranded with no work or money in the midst of a country-wide lockdown, the Union Labour Ministry has asked all state chief ministers to dip into unutilised welfare funds and deposit cash directly into their bank accounts.
According to labour Minister Santosh Kumar Gangwar’s letter to state CMs, the states currently have over Rs 52,000 crore in cesses collected by labour welfare boards under the Building and Other Construction Workers (BOCW) Act. The Centre has invoked Section 60 of the Act for this move, which allows it to “give directions to the government of any state” with regards to implementing its provisions.
Noting that the measures being taken to contain the Covid-19 outbreak may “lead to financial constraints, specifically to unorganised workers”, Gangwar said it was imperative that the governments devise mechanisms to “support unorganised workers who sustain their livelihood on daily wages”.
“The (Centre advises the states/UTs) to frame a scheme… for transfer of adequate funds in the bank accounts of construction workers through the Direct Benefit Transfer mode. The amount to be granted… may be decided by the respective governments,” Gangwar said, adding that this would provide financial relief and improve morale in a time of crisis.
Around 3.5 crore construction workers are currently registered with the labour welfare boards and the cess levied for their welfare is currently one per cent of the construction cost of every project. Both Punjab and Himachal Pradesh have already announced such relief for registered construction workers in their states by utilising these cesses. In the case of Punjab, the state is transferring Rs 3,000 each to around 3.2 lakh registered construction workers, while Himachal government will transfer Rs 1,000 each to around 1.5 lakh workers.
While the scheme will be of immediate benefit to the 3.5 crore workers registered with labour welfare boards, industry estimates put the total construction workforce in India at over 4.5 crore. State governments, however, will have to ramp up coverage under the scheme for those not registered under the BOCW Act.
Almost all construction sites in the country have grinded to a halt in the face of mounting lockdowns and curfews. Millions of workers are stuck away from home with no opportunity to earn wages.
“Projects in urban areas have got highly impacted. Imposition of Section 144 by state governments and suspension of public transport till March 31, has impacted manpower mobility. Strict checks on the same have led to corporates scaling down operations,” HDFC Securities said.