Govt proposes wider coverage for migrant workers under labour laws

 The National Democratic Alliance (NDA) government has proposed widening the coverage of migrant workers under labour laws, along with extending more social security benefits to the working class most affected during the COVID-19 pandemic.

According to the Occupational Safety, Health and Working Conditions Code, 2020, introduced by Labour and Employment Minister Santosh Kumar Gangwar in Lok Sabha on Saturday, all workers earning up to Rs 18,000 who migrate from one state to another will be covered under the proposed law.

Under the present law, migrant workers were covered under labour laws only if they were hired through contractors. As a result of this, migrant workers who travelled on their own for work were not covered under the ambit of the labour laws.

According to the proposed definition, a migrant worker will be the one who “has been recruited directly by the employer or indirectly through contractor in one state for employment in such establishment situated in another state” or “has come on his own from one state and obtained employment in an establishment of another state.”

The government has, however, dropped a provision in the previous draft of the law which made it compulsory for employers “to provide and maintain suitable residential accommodation” to migrant workers “during the period of their employment.”

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The government has further done away with ‘displacement allowance’ that migrant workers are supposed to get from contractors at present. However, employers will have to pay journey allowance, which will be a yearly “lump sum amount of fare”, to workers to travel to and from their native place.

For the first time, the government has made a provision for framing schemes to provide option to migrant workers for availing benefits of public distribution system either in their native or destination state. The migrant workers will also be able to avail benefits out of the cess funds meant for building and construction workers in the state where they are employed.

The proposed law will be applicable to establishments hiring at least 10 workers.

The proposed code has said that it will be “duty” of employers to extend certain benefits to migrant workers that are given to other workers in their establishment, including those related to the Employees’ Provident Fund and Employees’ State Insurance schemes.

To ensure that the dataset of migrant workers are maintained by the States, “the Central Government and the State Government s shall maintain the data base or record, for inter-State migrant workers, electronically on such portal.” The migrant workers will also be allowed to register themselves on the portal, after giving a self-declaration and Aadhaar number.

The national lockdown imposed by the Central government in March to deal with the COVID-19 pandemic led a reverse migration. Workers left cities to go back to their villages as industries were shut and paying off house rent or taking care of basic needs became a challenge, apart from health concerns. According to official estimates, 500,000-600,000 workers had to walk back home on foot as public transportation was not available to them. They travelled miles on foot to reach their villages. According to one official estimate, around 8 million workers migrated back to work after the national lockdown.

Housing finance companies get Rs 10,000-crore liquidity infusion

The National Housing Bank (NHB) has decided to infuse an additional Rs 10,000 crore into housing finance companies (HFCs) to improve liquidity in the sector. The move would enable the companies to provide individual loans for affordable housing, said the finance ministry on Friday.
Also, Finance Minister Nirmala Sitharaman will meet heads of state-owned and private banks on Monday to discuss the ongoing liquidity crisis in non-banking financial companies and slowdown in sectors such as automobile. Credit to priority sectors as well as small and medium industries will be discussed to find ways to accelerate economic growth.

The finance ministry made these announcements at a media briefing on Friday. Senior officials who addressed the media did not take questions.
“To further ease flow of funds to the housing sector, the NHB is making available from today, a liquidity infusion facility of Rs 10,000 crore for HFCs as additional liquidity for individual housing loans for affordable housing. This facility will be over and above the two existing refinance schemes of the NHB,” according to the statement read out by the officials.
Besides three finance ministry additional secretaries - Sameer Kumar Khare, C S Mohapatra and Pankaj Jain -Chief Economic Advisor (CEA) Krishnamurthy Subramanian also came to brief the media. But, the CEA left abruptly.
The finance ministry, from next week, will hold meetings with various departments to come up with solutions to boost the micro, small and medium enterprises (MSME) sector, officials said. Meetings will be held with ministries of MSME, Electronics and Information Technology, Rural Development, Health and Family Welfare, Corporate Affairs and Commerce, among others.
The basis of these meetings will be the recommendations of the U K Sinha committee, an expert panel on the MSME sector which submitted its report in June. "The committee has made over a hundred far reaching recommendations. These encompass various domains such as credit, equity funding, technology, delayed payments, need for legislative changes, rural enterprises, setting up of specific funds by the government, etc," the statement said.
Among its various recommendations, the Sinha panel, constituted by the Reserve Bank of India, suggested doubling of collateral-free loans for MSMEs, self help groups and borrowers falling under the Mudra Yojna to Rs 20 lakh. It also suggested creating a stressed asset fund of Rs 5,000 crore to protect the sector from distress caused by external circumstances.
The officials also pointed out that following the Budget announcement of state-owned banks being provided partial credit guarantee by the Centre, in order to buy high-rated assets of NBFCs, the government has received a proposal from the Reserve Bank of India on the draft modalities to operationalise the scheme. "The government has accorded its approval to the modalities that would be set in motion by RBI," they said.
In her budget speech on July 5, Sitharaman had said that "NBFCs that are fundamentally sound should continue to get funding from banks and mutual funds without being unduly risk averse. For purchase of high-rated pooled assets of financially sound NBFCs, amounting to Rs 1 trillion during the current financial year, the government will provide one-time six months' partial credit guarantee to public sector banks for first loss of up to 10 per cent."
The NHB's decision is one of the many steps taken by the government to boost affordable housing in recent times. It will also perk up the real estate sector - a major employment generator. Last month, the Budget announced an additional deduction of Rs 1.5 lakh on interest paid on loans for affordable housing priced up to Rs 45 lakh. In March, the GST Council reduced the GST rate for under-construction affordable housing from 8 per cent to 1 per cent.
Among the various sectors facing a slowdown, the automobile sector is the worst. The latest figures did not provide any respite to the continuing muted sales in the sector. In June, domestic sales across passenger vehicles, commercial vehicles as well as two- and three-wheelers fell 12 per cent year-on-year, according to the figures provided by the Society of Indian Automobile Manufacturer.
A Moody’s report warned that the slowdown and the lingering crisis at NBFCs pose fresh challenges to the asset quality of banks. Moody's said it expected growth to be "weaker" in the next 12-18 months.
Easing the stress
The new facility will be over and above the existing finance schemes of the housing sector regulator
Liquidity provided for affordable housing retail loans
FM to meet heads of PSBs and private banks on Monday
Govt to work on recommendations of UK Sinha panel on MSMEs

Data not finalised, says Niti Aayog about report on unemployment rising

India's unemployment rate hit a 45-year high of 6.1 per cent in 2017, according to a report based on an official survey, which the government said was yet to be approved.
The National Sample Survey Office's (NSSO's) periodic labour force survey (PLFS), according to the Business Standard newspaper, states that unemployment was last this high in 1972-73.

To compare, the unemployment rate in the country had gone down to 2.2 per cent in 2011-12, according to NSSO data.
Niti Aayog Vice Chairman Rajiv Kumar, who had previously mounted a defence of lowering of UPA-era GDP growth rates, at a press conference Thursday said the report cited by the newspaper "is not finalised. It is a draft report".
Refusing to comment on the content of the news report, he said the government will release its employment report by March after collating quarter-on-quarter data.
He also debunked claims of jobless growth, saying how can a country grow at an average of 7 per cent without employment.
Niti Aayog CEO Amitabh Kant, who too was present at the conference, said India is creating adequate number of jobs for new entrants, but "probably we are not creating high quality jobs".
Two members -- including the acting chairman -- of the National Statistical Commission resigned this week, saying the government had not released the job numbers despite the commission's approval.
The NSSO report was based on data collected between July 2017 and June 2018 and is the first official survey post-demonetisation.
The news report further said that unemployment was higher in urban areas (7.8 per cent) as compared to 5.3 per cent in rural areas of the country.
Earlier, the Centre for Monitoring Indian Economy (CMIE) had stated that 1.5 million jobs were lost just in the first four months of 2017 -- immediately after demonetisation of old 500 and 1000 rupee notes.
The NSSO job report was previously planned to be released in December 2018.