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Social security for informal sector workers- the only way for sustainable economic growth and the current need: registration portal by July 31.

The COVID-19 pandemic has been an awakening call for people’s privileges and we’ve been struck with this huge increase in income inequality, where the top 1 percent is adding them higher to the list of richest people in the world while the other section is not even able to afford shelter over their heads. However, one other thing that the pandemic disclosed about India’s economic systems is the structural lack in the country’s informal sector. The migrant workers, the labourers and informal social sector wage earners were amongst the worst hit during the crisis. And well, were at the bottom of the line when it came to receiving any aid from the government as well.

When we talked about the 7.3 per cent contraction that the country witnessed last year, the numbers did not even completely take into account the informal sector loss of consumption and product because there’s very little scope for appropriate measurement due to mobility. However, the contracted value added from the construction sector was representative of how the people employed must have fared through time.

The plight of migrant workers during the first nation-wide lockdown is a rather vivid memory that is instilled in all of our brains, Nonetheless, the plight was a little silent one during the second time around since the public transport was relatively more mobile. Even though a few provisions were made by the centre and the state during the time, it can be fairly said that in retrospect, they were fairly meagre.

The people in question not only lost their sources of livelihood, but they also ended up exhausting almost all of their savings since they received no significant aid from the government. The loss of discretionary consumption in the sector is one evident factor of it. This highlighted the cause for a greater conversation, now that so many behavioural changes are taking place in the economy. This conversation is about the need for social security for migrant workers and the earners in the informal sector of the country. It is because if we do not talk about it now, a greater crisis would be looking us right in the face and this time, we want to be prepared.

parl panel for social security number for migrant workers - orissapost

First things first, this conversation roots from the decision announced by the Supreme Court back in the day that referred to the migrant workers’ plight at the time of the first lockdown. It accepted the exclusion of workers from the existing social security schemes due to a number of factors that need correction.

Even though the scope of the judgement was limited, it started a larger scale conversation about the need for newer laws and alterations in the existing ones to be more receptive towards the need of migrant workers and informal sector earners. Let’s first talk about how the existing social security rules are insufficient for the proper inclusion of the aforementioned section.

Inadequacy of social security schemes

The existing schemes in the social security arena can be best described as inadequate for the inclusion of migrant and informal sector workers due to two primary reasons-

  1. Because it fails to recognise the lack of registration of the aforementioned section
  2. Because the eligibility list is too out-dated to properly undertake the required provisions.

Thus, as can be inferred from the points above, the benefits remain overdue to the needy section. As a result, the Supreme Court order after analysing these loopholes made two alterations and or provisions-

  1. No advantages will be denied to migrant workers for want of an Aadhaar card
  2. Food assistance will be given and provided to the migrants who were not covered by the National Food Security Actprotecting the unprotected: how can social protection reduce the vulnerability of informal workers? - igc

It also made compulsory the operation of a registration portal for registration of all the migrant and informal sector workers before the end of July 31.

To talk about it in the real sense, allow me to trace the path of the post-pandemic effect for the informal sector workers. A number of loopholes as described above in the social security benefits to the informal sector workers exposed the social and economic vulnerabilities of the section. It has also created a ripple of deterioration for these wage earners in distinct life verticals. This is reflected through the increased indebtedness, exploitative quality of work, and lower-income levels relative to the pre-pandemic levels, pushing even more households into poverty.

The major objective of this discussion is to highlight how the lack of representation of some categories in the informal sector space has been a prominent cause for more deterioration of some when compared to others, like the circular migrants.

Effectively, the social security net so provided to these migrant workers and informal sector earners were particularly restricted, inclusive of the public distribution scheme. Therefore, the point once voiced by the National Commission for Enterprises in the Unorganised Sector nearly 15 years ago is making rounds again. It is since the then government completely slid through their main proposition of a universal registration mechanism based on self-declaration, issuance of a smart social security card and a National Minimum Security Package made available to all informal sector workers, including migrants and seasonal workers.

Therefore, while the authorities have equivocated their way out all this while, the heightened concerns brought up by the pandemic have once again exaggerated and alleviated the noise on the need for a minimum level of assured social security/ social protection for all informal workers. This comes with reference to time-frame and categories.

labour reforms: no one knows the size of india's informal workforce, not even the govt - businesstoday

The initiative for a Social Protection Floor as purported by the UN back in 2009, calling for a definite framework system. It further committed government spending in place to ensure considerable investment in social protection on the workers of unorganised sector and a conscious effort to increase worker productivity and their socio-economic condition.

Doubters may ask how the public authority can accomplish a widespread SPF under the monetary requirements forced by the current emergency. Without a doubt, the public authority ought to have spent more on the poor during the emergency, since the assigned consumption was lacking and frivolous as a level of the GDP. All the more fundamentally, these were optional, impromptu, once consumptions, while extra assets ought to have been spent as a feature of a positive intention to convey an ensured least, conjured as a right.

There are no two ways when we say that social security of informal sector workers has emerged as one of the most prominent needs of the current times. As a result, to reduce the after-pandemic deterioration effects to create a more sustainable growth pace, the government must start at the bottom.

Edited by Karishma

Simerleen Kaur

Talk to me about economics, trade, and all things India.

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