In Punjab, construction workers bear brunt of post-lockdown real estate slump, but welfare funds to the tune of Rs 1,000 crore remain unspent

In Punjab, funds to the tune of Rs 1,000 crore received by the government through a labour cess are presently lying unspent.

Vivek Gupta June 17, 2020 19:30:17 IST
In Punjab, construction workers bear brunt of post-lockdown real estate slump, but welfare funds to the tune of Rs 1,000 crore remain unspent

In Punjab, funds to the tune of Rs 1,000 crore received by the government through a labour cess are presently lying unspent. Despite this, construction labourers, the intended beneficiaries of the cess, had to suffer during the lockdown. With a slump in economic activity, their situation seems unlikely to improve soon.

The labour cess is envisaged in a 1996 central legislation, Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act. This law empowers states to levy a 1 percent labour cess on construction activities, and then use this fund for the welfare of construction labourers.

Parveen Kumar Thind, secretary, Punjab Building and Other Construction Workers’ Welfare Board (PBOCWWB), a nodal agency in charge of utilising the labour cess, claims that the state government has disbursed Rs 6000 per head to the state’s 3 lakh active registered construction workers. This, he said, amounted to a total spending of Rs 180 crore after the Centre’s 24 March circular, which had directed state governments to transfer welfare funds to construction workers.

However, media reports have stated that despite official claims, many labourers are yet to receive the benefits.

The actual number of construction labourers could be much more than the official figure of 3 lakh, if a recent report by the Comptroller and Auditor General of India (CAG) is any indication. The report revealed that the labour welfare board’s own estimate pegged the total number of construction workers in Punjab at 15.33 lakh.

In Punjab construction workers bear brunt of postlockdown real estate slump but welfare funds to the tune of Rs 1000 crore remain unspent

Labourers waiting for work in Mohali district. Image procured by Vivek Gupta

“The non-adoption of any mechanism by the board to identify the unregistered workers had resulted in non-achievement of targets besides denial of welfare benefits to the construction workers due to non-registration,” said the CAG report.

Lakhwinder Singh, president of Ludhiana based Karkhana Mazdoor Union, said that daily construction labourers were worst affected during the COVID-19 lockdown, since there was a complete ban on all construction activities.

"Many were forced to flee to their home states, since there was no major help from the state government. Others barely managed to survive with the help of community support. Even now, unorganised labour continues to bear the brunt of the market slump, be it in real estate or other sectors," he added.

VK Janjua, Principal Secretary, Labour, said, “The state for some time was aggressively enrolling construction workers through special camps. But the lockdown hampered this process. Once the situation is normalised, we will again renew our efforts.”

Janjua, who is also the secretary of PBOCWWB, said, “This is a great scheme to help the poor and we don’t want to leave anyone out of it."

Inadequate implementation mechanisms

In Punjab, the labour cess scheme came into force in 2009, thirteen years after the central act was passed. Even after that, the implementation of the scheme left much to be desired. Recently, a private agency hired by the labour board to increase its beneficiary base has come under fire for several reasons.

An order of the labour board on 1 June stated that the said agency (Common Service Centres) not only charged an exorbitant fee for registration, but also made ineligible beneficiaries fill applications. A media report said that as many as 217 workers were registered with the same mobile number. The matter is currently being probed at the level of the board.

Raghunath Singh, general secretary, Centre of Indian Trade Unions, said that the registration process has often been characterised by touts, middlemen and fake registrations.

"Most of the workers in the construction sector are illiterate and yet, the labour welfare board made the registration process online in 2017, " he said.

The CAG report, too, had stated that the registration has slowed down since the online system.

Raghunath added most workers face huge problems in submitting reelevant documents. "Further, they lack awareness and are unable to fill the forms and produce documents like Aadhaar. This is especially so for migrant construction workers,” he said.

Vijay Walia, convenor of Patiala-based NGO Centre for Social Change and Equity, said that just 90 days of construction work in a year is required for a person to be eligible for registration under the BOCW act. The certification by his employer about the minimum duration of his work is a must.

“But construction workers find it difficult to procure this certification, because sometimes, the contractors whom they work for are also not duly registered under the Act,” said Walia.

Walia explained that the said Act has a provision whereby no construction is allowed to be carried out by a contractor who is not registered under this Act and has not made his workers registered. "However, there hardly ever was any effective drive to identify those unregistered contractors and pensalise them,” he said

“A major drawback is that a lot of registered construction workers are also unable to renew their membership every year due to the hassles in the system,” he said.

The workforce shortage in the labour department is also to be blamed for the scheme's poor implemsentation.

A labour inspector posted in Amritsar said on the condition of anonymity that apart from implementation of 26 labour laws, the entire burden of identifying eligible construction workers, conducting field inspections, etc has been put on the labour department.

“There are times when we can neither do justice to labour laws nor enrolment of poor beneficiaries," the inspector said. He also suggested that it would be better if the PBOCWWB hires its own staff for better implementation of the scheme.

As per data shared by a labour department officer, the state has only 70 labour inspectors on active duty. There are as many as 15 circles where the labour inspector' post is vacant.

Misuse of labour cess

As per Punjab government records, the board incurred approximately Rs 800 crore on monetary dispersal of 18 welfare schemes that were conceived over the years for the welfare of the construction workers.

But not all the money seems to have been spent on the intended purposes.

In 2015, there was a clear instruction by the Supreme Court not to use the labour cess for the construction of schools or training centres since it is reserved to fund welfare schemes for construction labourers.

In spite of that, 48 crore from the cess was spent between September 2015 and March 2017 to buy land and construct four Multi Skill Development Centres (MSDC) in Amritsar, Ludhiana, Jalandhar and Mohali.

In Punjab construction workers bear brunt of postlockdown real estate slump but welfare funds to the tune of Rs 1000 crore remain unspent

An unfinished government building in Amritsar that was constructed from labour cess funds in violation of the Supreme Court's orders from 2015. The building has now been put up for sale. Image procured by Vivek Gupta

The work on all these buildings was stopped due to the Supreme Court's intervention in 2017, but not before crores were already spent.

Principal Secretary, Labour, VK Janjua said that the process to sell these buildings and accordingly recover the expenditure is underway as per the court's directions.

A CAG report that scrutinised the assessment files of all the labour schemes, too, revealed major discrepancies in awarding monetary benefits.

For instance, in Sangrur, three lakh ex-gratia was said to have been disbursed to the family of a deceased worker in 2016, who was found registered after his death.

In five other cities, ex-gratia amounts adding up to Rs 73 lakh were disbursed to adult sons and brothers of deceased workers, who were not eligible as per the scheme

Further, as per the Shagun scheme of the board, each registered construction worker was entitled to get Rs 31,000 on the occasion of the marriage of their daughters. However, the report found that Rs 8.06 lakh were dispersed to 26 beneficiaries on the marriages of their minor daughters, in contravention of Section 2(a) of the Prohibition of Child Marriage Act, 2006.

As per the report, the board had identified 1,588 (up to January 2018) and 3,307 (up to March 2018) eligible registered workers for family pension and pension cases respectively.

But only 165 cases (132 family pension and 33 pension cases) were approved up to 2019 for issuance of pension benefits.

Commenting on this, Janjua said, “There were procedural lapses in implementing welfare schemes but this can’t be equated with financial embezzlement. We have sought the explanation of circle officers based on the CAG report."

Kultar Singh Sandhwan, Aam Aadmi Party MLA from Kotakpur, said, "When I was the chairman of the public accounts committee of the Punjab Vidhan Sabha last year, I had recommended a high-level probe to inquire into the matter. But nothing happened, since the state government did not act on our recommendation," he said.

Speaking about the lockdown, Sandhwan said, “The lowest rung of the society was most affected due to the coronavirus outbreak, as they lost jobs and were made to sleep hungry. The state government claims that it has transferred money into the accounts of 3 lakh registered labourers. But can anyone guarantee that the list was accurate, and that it comprised all eligible beneficiaries?” he asked.

Hardships continue in post-lockdown phase

Mukhtar Alam can't tell his age, but guesses that he is probably about 25 years old. He had been working as a labourer in Ludhiana ever since his family migrated from Nalsar village in Bihar's Katihar district in 2008.

However, Alam went back to his village a month ago. He said that it was getting very difficult to survive during the lockdown in Punjab. There were no jobs as construction activities were banned. To add to his worries, the landlord was asking him for his room rent.

Alam further said that he has not received any government help.

However, he lamented that surviving in the village was also getting difficult. "I don’t know what to do. I hope everything becomes normal soon," he said

'Labour chowks' in Punjab are getting back to normal after having been deserted for two months. But labourers are not getting enough work as construction has not yet started in full swing. This is owing to a liquidity crunch in several sectors, including real estate.

Updated Date:

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