Laptops and washing machines were bought out of a whopping Rs 29,000 crore fund meant for the welfare of construction workers and less than ten per cent spent on the actual purpose. Terming this as a “shocking” and “extremely distressing” state of affairs, the Supreme Court has said the funds, collected by the government through a cess under the construction workers law, were being “frittered away” and diverted, instead of being spent on welfare of the beneficiaries.
While making these observations, a bench of Justices Madan B Lokur and Deepak Gupta have directed the Union Labour Secretary to appear before it on November 10 “to understand how the act was being implemented and why it was being misused, if not abused.”
The “astonishing” details were given in an affidavit by the Comptroller and Auditor General (CAG) that the funds meant for construction workers’ welfare were spent to buy laptops and washing machines for them, that shocked the Supreme Court. The apex court had earlier asked the CAG to file a report on how crores of rupees meant for welfare of construction workers was being spent.
It was hearing a PIL filed by NGO, National Campaign Committee for Central Legislation on Construction Labour, which has alleged that the statutory cess levied on real estate firms for the welfare of construction workers was not being utilised properly as there was no mechanism to identify the beneficiaries for extending the benefits.
Asserting that there should be no further exploitation of construction workers by the states or welfare boards, the top court observed that the CAG has revealed a “shocking state of affairs” with regard to the utilisation of the cess collected under the Building and Other Construction Workers (Regulation of Employment and Conditions of Service) Act, 1996.
“For example: we have been shown expenditure having been incurred for payment of entry tax/value added tax; expenditure incurred for purchase of washing machines for construction workers; expenditure incurred for purchase of laptops for construction workers etc. This is really astonishing,” the bench noted in its order. “It is quite obvious from the above that the amounts are just being frittered away, if not defalcated by the concerned welfare boards,” it said.
“Apart from the above, we find that huge amounts have been spent towards administrative expenses while the statute permits only five per cent expenditure towards administrative expenses,” it said.
The top court observed that the law was “being misused” as the beneficiaries, who were construction workers, were not given benefits they are entitled to and the money collected was being diverted to the labour welfare boards or the state governments for other purposes. “We may note that huge amounts have been collected in the region of Rs 29,000 crore and not even 10 per cent has been spent for the benefit of construction workers. The amounts, whatever has been spent, appear to have been spent for the purposes other than for the benefit of construction workers,” it said.
Observing that this must be rectified at the earliest, the bench sought the presence of the Secretary of the Union Labour Ministry before it on November 10 to understand how the act was being implemented and why it was being misused, if not abused, to the detriment of the construction workers. The court had in 2015 expressed displeasure over non-utilisation of a whopping Rs 26,000 crore (the amount then) by the Centre and various state governments, saying “it cannot get worse than this.”