Introduction
Collected under the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996 (hereinafter BOCW Act), the labour cess funds form an important resource for the welfare of building and construction workers, with appropriate state welfare board(s) created under the Act for its proper utilisation. Section 22 of the BOCW Act provides for the utilisation of the funds to “provide immediate assistance to a beneficiary in case of accident”, pay for group insurance schemes, make payment for pensions to beneficiaries, “sanction loans and advances to a beneficiary for construction of a house”, furnish financial assistance for the education of beneficiaries’ children, meet medical expenses of a beneficiary or their dependant for major ailments, make payment of maternity benefit to the female beneficiaries, and provide better facilities to the workers. Hence, effective utilisation of the financial resources by the welfare boards is essential for the benefits to materialise and trickle down to the beneficiary workers, especially given the monetary contributions of the workers under the BOCW Act.
However, except for Kerala, which has used 100% of its funds collected under the Act, most states/UTs have failed to effectively utilise the available funds for the benefits of the workers. This can be revealed from the data provided by the Ministry of Labour and Employment during the current parliamentary session. In response to the question posed in Rajya Sabha by G.C. Chandrashekhar, INC MP from Karnataka, regarding the utilisation of labour cess funds, the Minister of State for Labour and Employment, Sushri Shobha Karandlaje, provided the details about the utilisation of labour cess funds as of March 31, 2024. Whereas a total of 1,12,331.09 crores have been collected across all the states/UTs till March 31 this year, the spending against the same is merely 64,193.90 crores. Thus, effectively, 48,137.19 crores remained unused by the welfare boards across the states/UTs. Significantly, total number of registered BOCW workers across India stood at 5,65,16,292. It is to be noted that data for the states of West Bengal and Sikkim was available as of January, 2024 and March 31, 2022, respectively.
Notably, Gujarat, which is a leading industrial state, spent a meagre sum of 1012.22 crores against its total collection of 5549.46 crores, with 4537.24 crores remaining in its balance (including bank interests and other receipts). States like Karnataka and Maharashtra had slightly higher relative spending among industrial states, though still worse from the other well performing states/UTs like Puducherry and Kerala. Karnataka spent 7028.05 crores against its total collection of 10874 crores, while Maharashtra spent 12909.16 crores against whopping cess collection of 18579.82 crores. Kerala remained the only state to use all of its funds, with cess collection and expenditure both equalling 3457.32 crores.
The data shared by the Ministry of Labour and Employment can be found below:
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