Journalism : 5 big trends that transform the work and blur the lines
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Protecting the vulnerable: Providing social welfare to informal sector workers
“ The Virtually Unidentified Sector “
Team Details
Rapid Squirrels
Vikas Mishra | Akanshi Bhargava |Sparsh Banga |Dhruv Gupta | Opender Garg
Informal Sector: Who are they ?
Over 92% of India's workingpopulation which has nosocial security , no financialsecurity, no housing facility,work for long hours andface high exploitation.
India's unorganized sectorcreated 57% of the India’sNet Domestic Product in2006, about 9 fold less perworker than the organizedsector.
Identifying the unorganized workforce is extremely complex as they operate outside the tax ambit.
There is no consensus nationally on the classification of the unorganized sector.
There is a lack of convergence of related or similar social security schemes.
Financial exclusion of the informal workers from the institutional banking system makes delivery of social security challenging.
Informal workers are disparate and fragmented which makes enforcement and provisions by centralized schemes difficult to administer.
Most of the unorganized workforce is highly unskilled, illiterate and unaware of the social security schemes which makes them vulnerable and exploitable.
Identification
Social and Financial Security
Regulation
Opportunity, Skills and
Awareness
Unique identification and compulsory registration of every individual using the
principle of Aadhar ACCOUNT.
Comprehensive Social Security schemes such as HELP, IPS and Financial Institution
exclusively for unorganized sector.
Formation of separate Ministry of Social Security for unorganized sector to make policy formulation, implementation and analysis of
social security an easier task.
Creating Opportunity, spreading awareness and enhancing skill sets through skill
enhancement programme and Artisan Solutions Limited.
Overview of the Problems and Solutions…Proposed SolutionsExisting Problems Major Challenges
Identifying the vulnerable and providing benefits through Aadhar Account
• Aadhar Number needs to be modified into Aadhar account.
• It should be made mandatory and legal responsibility of every citizen of India to register and UPDATE EMPLOYMENT DETAILSto receive and check Social Security Benefits provided by the government of India
• Aadhar Account will be used by the government to:
• Classify and organize the workers under different associations such as Association for Construction Workers etc. on thebasis of their income and employment.
• Transfer social Security benefits directly in the bank account linked with Aadhar account and the workers will benotified by SMS, Aadhar Call Centres and AadharWebsite
• Aadhaar Volunteers and NGOs will help in spreading awareness about benefits of Aadhar account and assisting the workersto update their employment details and benefits from appropriate social security schemes.
Aadhaar
NGO
AadharKiosks
AadharVolunteers
Banks
Banks
AadharCentresRegister for
AadharAccount
• Bank Account Details• Mobile No. • Aadhar ID• Age and Biometric
Details
• Employment Status• Income Details• Social Benefits received from
employer ( If Any)• Bank Account Details• Mobile No.
Update Details
• Check for Social Security Benefits received.
• Complain or seek assistance
USSD/ SMS
Aadhar Call Centre
AadharWebsite
Aadhar Implementation Model
Registration Centres Update Centres
HEALTH – EDUCATION - LIFE - PENSION
Health Insurance Life Insurance
Old Age Pension
Each worker will be entitled tohospitalization for himself and hisfamily members, costing Rs.25,000 ayear in designated hospitals or clinics,public or private, recognized by theState Board.
• Natural Death: Rs. 50,000/-• Death or total disability due to
accident: Rs. 1,00,000/-• Partial Permanent Disability due
to accident: Rs. 40,000/
Old age Pension: Monthly pension of Rs. 1,000 from 60 years. Post 65 years the person will get an additional medical benefit of Rs. 200.
The workers can avail educationloan from any of the nationalizedbanks. The payment of the loanEMIs and interest begins after therecruitment.
Education Loan Facility
Social and Financial Security
HELP
Help is a comprehensive socialsecurity scheme for low incomeunorganized workers. Under thisscheme the workers are madefinancially secured. The insurancepremium is jointly paid bygovernment and individuals atbelow mentioned proportion.
Income Range (Rs.)
PremiumProportion
Govt. : Workers
0-2000 95% : 5 %
2001- 4000 90% : 10 %
4001 - 6000 75% : 25 %
6001 - 10000 60 % : 40 %
Social and Financial Security
Promoting Self Help GroupsProviding Micro Credit Facility
Financial Institution under RBI for unorganized sector
The institution will provide credit facility to theworkers of unorganized sector at low interest ratesand flexible time span with less collateralrequirement.
The institution with the help of NGOs and Volunteers will beresponsible for spreading awareness among the workersabout the habit of saving and pooling money in the form ofSelf Help Groups.
IPS is the unique web based initiative which will offer farmers all the information, products and services they need to enhance farm productivity, improve farm-gate price realization and cut transaction costs.
Farmers can access latest local and global information on weather, scientific farming practices as well as market prices at the village itself through this web portal -in regional languages.
IPS will facilitate supply of high quality farm inputs as well as purchase of commodities at their doorstep.
Information and Purchase scheme (IPS) : Opportunity to unorganized agricultural sector workers
A financial Institution should be exclusively established under RBI to provide financial security to the unorganized workers.
Social Security Law
Due to lack of convergence of related or similar social security schemes there is a need to merge theexisting Acts to form a social security law which targets all the sections of unorganized sector and isuniform in all the states of the country.
There is need of following amendments and additions in the Social Security Law:
• Revival of Janta Cloth Scheme: Since the Handloom sector is one of the largest employment providingsector, Janta Handloom Cloth Scheme needs to be revived for the workers in handloom industry.
• Housing Facility: All the companies with more than 30 employees in service sector and 50 inmanufacturing and construction sector need to provide housing facility to their workers.
• Nationalization of Ration Cards: Ration cards should be nationalized i.e. people can avail ration from anyPDS shop all over India.
• Minimizing Bribes: To control the problem of bribing and help the unorganized sector workers get thebenefit of social security schemes the officer-in-charge of the Government Regulating Authority who isauthorized to check the implementation of schemes in companies must be given incentives in the form7%-12% of the Challan (Fine) Amount.
Implementation and Regulation of Social Security Schemes
Government Regulating Authority
Responsible for monitoring and checking the implementation of the scheme. Its main role is to prevent malpractices such as bribery and find solutions to loopholes in the system.
Volunteers and NGOs
Responsible for spreading awareness about the benefits of Aadharaccount and various social security schemes. They are also responsibleto help the workers to reach their association for their demands orcomplaints against non-availability of social security benefit orexploitation. The undergraduate students can be provided at least 15days internship for the same.
.
Association of Unorganized
workforce
Using the employment details from the Aadhar account the workers willbe grouped under different Association such as Association forConstruction Workers etc.The workers can seek assistance and support regarding any socialsecurity benefits or complain against exploitation to the regional head oftheir Association. Hence Association is liable to help the workers toattain their social security rights and prevent exploitation
Responsible for maintaining and allocating budget for different social security schemes
National Social Security Commission for Regulation and Management
Commission for Finance and Budget Management
Ministry of Social Security for Unorganized Sector
Building Skillsets and Creating Opportunity
With the help of NGOs and Volunteers the government will provide skill enhancement program to the unorganized sector workers in various fields such as IT, Business Development and Artistic Creativity.
Various incentives such as travelling allowance etc. can be provided to the workers to attract them for the training program.
After successful completion of the program the workers will be offered a certificate of merit and insurance backed credit facility to start their own business.
Artisan Solutions Limited (ASL) : ASL is an innovative step to provide financial security to the Artisans.
The government will have tie ups with different domestic and foreign companies which have huge demand for artistic products. The government will sell the good quality artistic products to the domestic and foreign companies/buyers. Hence government will act as a medium between these companies and artisans, therefore increasing the efficiency, productivity and income of the artisans.
Skill Enhancement Program
Business Development and MarketingIT Artistic Creativity
• Due to lack of awareness it could be difficult getting correct and updated information about income and employmentat initial stage, but with active media participation, awareness programmes by NGOs and volunteers this problemcould be easily solved.
• Arranging funds for different programmes could be a difficult task..
On the basis of its detailed assessment, the recommended Programme, in our view, not only provides a minimumstandard for conditions of work and social security but also provides a measure of livelihood opportunities to the 92percent of the unorganized workers in this country. We believe that these measures are within the administrative andfiscal capacity of the Government, and if implemented within a short period of time, will have a significant impact on thelives of the working poor.
• Aadhar Account will help the government to easily identify and classify the informal sector workers according to theirincome and employment.
• One of the major problems faced by low income unorganized people is financing the medical ailments, highereducation and old age needs. Therefore HELP scheme will solve all the stated problems.
• Under association of unorganized sector the workers can easily raise their voice against exploitation by the employersand seek help from the regional head of their association.
• Activities of the employer will be checked by the regulating authority which can protect the rights of the workers.
Impact
Implementation Risk
Funding
• The schemes would be financed through the National Social Security andWelfare Fund (NSSWF).
• The schemes can be financed in following ways:• Grants and loans from the Central Government
• Contributions from workers, employers and state governments
• Any tax or cess that the Central Government may impose for the purpose of providingsocial security for unorganized workers.
• Any tax or cess that the Central Government may impose on commodities and/orservices in lieu of the employers' contributions.
However, the share of contribution of the BPL workers, if any, would be borne by theCentral Government. The government's cost may be entirely borne by the CentralGovernment or it may be shared between the Centre and States.
Reference
• National Commission for Enterprises in the Unorganized sector. (2009). The Challenge of Employment in India. Retrieved from http://dcmsme.gov.in/The_Challenge_of_Employment_in_India_(Vol.%20II).pdf
• Bhalla, S. (2003). The Restructuring of the Unorganized Sector in India.Retrieved from http://planningcommission.nic.in/reports/sereport/ser/restruc/stdy_rsturc_ch1.pdf
• Kulshreshtha, A.C. (2011). Measuring the Unorganized Sector in India. Retrieved from http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1837193
• Goswami, Paromita. (2009). A Critique of the Unorganized Workers’ Social security Act. Economic and Political Weekly.Retrieved from http://www.epw.in/system/files/pdf/2009_44/11/A_Critique_of_the_Unorganised_Workers_Social_Security_Act.pdf