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Labour Ministry directs State Welfare Boards to provide benefit via DBT instead of kind

The Ministry of Labour and Employment has issued an order to use DBT for financial assistance to BOC workers and to put restrictions on distribution of benefits in-kind by the State Welfare Boards.

March 25, 2021 / 07:53 PM IST
Representative image

Representative image

The Labour Ministry on Thursday directed the State Welfare Boards (SWBs) to use Direct Benefit Transfer (DBT) for providing assistance to building and other construction (BOC) workers directly into their bank accounts instead of distribution of aid in kind, like ration or household use articles.

The Ministry of Labour and Employment has issued an order to use DBT for financial assistance to BOC workers and to put restrictions on distribution of benefits in-kind by the State Welfare Boards.

"The order was circulated on 22nd March, 2021 to the Chief Secretaries, Principal Secretaries (Labour), Labour Commissioners and the Secretaries of the State BOCW Welfare Boards by the Ministry under the powers given to it by Section 60 of the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996," Labour Ministry said in a statement.

The Act aims at regulating the safety, health, welfare and other conditions of service of the construction workers through the State Welfare Boards (SWBs) in every State/UT.

The Ministry further noted that some State Welfare Boards were issuing tenders or incurring expenditure on distribution of household items such as lanterns, blankets, umbrellas, tool-kits, utensils, cycles and similar other articles instead of on tangible welfare measures such as life insurance, health insurance, disability cover, maternity benefits and old-age pensions for the workers.

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Since the procurement process adds layers to the entire process, with apprehension of leakages both at the procurement stage and at the distribution end, hence this decision was prompted, it said.

As per the Ministry's statement, "Transfer of money in the form of cash has been completely stopped by the instant order and any monetary assistance has to be necessarily given through DBT. The order also puts a ban on the distribution of articles in kind."

The statement however noted that benefit can be provided in kind in extra-ordinary circumstances such as natural calamities, epidemics, fire, accidents caused due to occupational hazard or similar other crisis and only with the prior approval of the State Government.

The law mandates the SWBs to spend the cess fund on payment of premium for pension, group insurance scheme, scholarships to workers'' children, medical expenses, maternity benefits and loans for house construction. It allows the boards to spend on such other welfare measures and facilities as may be prescribed.

"It was observed that some SWBs had taken recourse to this sub-section of the Act and resorted to arbitrary use of cess fund for construction of buildings and distribution of articles and utensils instead of using it for the welfare of construction workers, the ministry said.

The cess fund is collected by the states at a uniform rate of 1 percent on the construction costs of the public and private construction works. It is utilised by the SWBs for the welfare of construction workers, as per law.

An advisory was issued by the labour ministry on March 24, 2020 to all states to provide financial assistance to the affected BOC workers via DBT from the welfare fund maintained by them.

As per the latest figures, Rs 5618 crores were disbursed by the State Welfare Boards to about 1.83 crore construction workers directly into their bank accounts through DBT.
Moneycontrol News
first published: Mar 25, 2021 07:53 pm

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