Coronavirus pandemic: Centre asks states to use Rs 31,000cr fund for construction workers

The Centre has directed states to use the Rs 31,000-crore fund to aid 3.5 crore construction workers during the coronavirus pandemic. Real estate developers have welcomed the announcement saying that it is the step in the right direction and that the Government must consider providing similar relief to the unregistered construction workers.

States are required to use the Workers Welfare Fund to provide economic relief to construction workers facing economic disruption, Finance Minister Nirmala Sitharaman said on March 26.

Rs 31,000 crore is available in the Building and other Construction Workers Fund (BOCW). These can be used for 3.5 crore construction workers. The government has suggested state governments to utilise this for the welfare of these workers, Sambit Patra tweeted.

Niranjan Hiranandani, president – NAREDCO, welcomed the relief. “The widely covered unorganized sectors including agrarian and construction laborers, these moves aim at resolving primary problems of the poor.”

“One hopes that other segments of society, who are also looking forward to measures such as EMI waivers as also extension of loan scheme tenures, among others economic package shall be on wait and watch mode,” he said.

With state governments across India announcing a lockdown to contain the spread of novel coronavirus or COVID-19, work at ongoing construction sites has come to a grinding halt, real estate developers told Moneycontrol.

“The Government’s announcement to primarily protect the livelihood of the citizens currently at an economic disadvantage is a step in the right direction. We particularly laud the utilization of the existing Rs 31,000 crore welfare fund for over 3.5 crore construction workers across India,” said Nayan Shah, President, CREDAI MCHI.

“However, there is an urgent need for the Government to follow a similar approach to combat the adverse implications of Covid – 19 on the Indian Real Estate industry,” he said.

“We thank the Government for taking cognizance of our recommendation and advising the states to use BOCW cess funds collected by the labour welfare boards in providing the immediate relief to the construction workers. Concurrently, the Government must consider providing similar relief to the unregistered construction workers,” said Satish Magar, president, Credai, National.

“We are also ensuring that our construction workers are provided with basic amenities to be able to cope up with the ongoing situation. With this positive step, the industry eagerly awaits the economic stimulus required for our revival. We stand in solidarity with the government as a socially responsible organization,” he said.

Construction at all sites came to a halt last week. Daily wage construction workers are suffering because of the lockdown. Besides those from MMR who have returned home, about 50,000 construction workers from the around 3 lakh labourers in Delhi-NCR have returned to their hometown.

All developers are required to pay one percent as cess to the Building and Other Construction Workers Welfare Fund.

Pradeep Aggarwal, founder and chairman, Signature Global and Chairman, National Council on Affordable Housing, ASSOCHAM said that workers are vital for the construction industry and thus, we welcome the government’s decision to extend a helping hand to them through effective use of the Building & other construction welfare fund.
The Building and Other Construction Worker Welfare Fund has a corpus of about Rs 31,000 crore. It is important that the proceeds are effectively utulised to help this vulnerable segment, said Ashish Bhutani, MD Bhutani Infra.

The Delhi government has decided to give Rs 5,000 to construction workers as their livelihood has been affected due to coronavirus outbreak, Chief Minister Arvind Kejriwal announced on Tuesday.

Subhash Bhatnagar, National Campaign Committee for Central Legislation on Construction Labour (NCC-CL), too had written to the Delhi Chief Minister Arvind Kejriwal requesting for a transfer of one-month minimum wage into the bank accounts of construction workers registered with the Delhi Building and Other Construction Workers Welfare Board (BOCW).

This letter was in response to the March 22 order notifying a lockdown in the NCT (National Capital Territory) of Delhi until March 31.

“There are over 10 lakh construction workers in Delhi. Of which, 5.4 lakh are registered with the Delhi BOCW. Because labour officials of the Delhi BOCW suddenly stopped carrying out their responsibilities from May 2018 onwards, most construction workers do not have a ‘live’ registration. Even the digital upgradation of membership, which was started on November 16, 2018, has been very slow. In 16 months, it has been able to update only 50,000-60,000 construction workers as ‘live registrations’ of the over five lakh registered beneficiaries,” the letter had said.

States like Kerala, Punjab, Uttar Pradesh, Andhra Pradesh, Telangana and Jharkhand have announced emergency relief as ‘other’ benefits under their respective state BOCW boards in light of the current health crisis.

The Supreme Court last week categorised over two crore registered construction workers as ‘consumers’ making it possible for them to move consumer forums if any government denied them benefits promised under the welfare schemes implemented with funds collected as ‘cess’ from real estate builders.