The Centre has opposed the Delhi government’s plan to build dedicated hospitals, hostels and schools for construction workers at a cost of Rs 1,160 crore through a cess collected for them from the industry. Union Labour Minister Bandaru Dattatreya held an hour-long meeting with the Delhi Labour Minister Gopal Rai on the issue where the latter claimed that state has not spent a single penny on the plan so far.
“We had received complaints that the Delhi government has planned to use construction cess collected by them for programmes other than prescribed in the Act. Thus, it was necessary to ask them about that,” Dattatreya told reporters after the meeting.
“They told us that they are working on a new model. We said if you want to construct hospital, school or hostel, then the state government can do it (from its funds). They said they will look into the Act and scheme.”
According to Dattatreya, the Centre has received information that Rs 1,160 crore expenditure is provided for the Delhi government’s plan to construct dedicated hostels, schools and hospitals for construction workers.
He spoke about the Delhi government having about Rs 1,900 crore under the construction cess account. These funds should be used for providing social security like insurance or pension and other benefits like scholarships to them, he suggested.
Dattatreya cited the rulebook, saying there is no provision for such spending on dedicated purposes under the Building and Other Construction Workers Act.
Backing up, he spoke of the Supreme Court ruling that has strictly asked the states to spend money as per provisions of the Building and Other Construction Workers’ Welfare Cess Act, 1996.
Labour Secretary Shankar Aggarwal said, “They (the Delhi government) had taken a decision to create a dedicated infrastructure, but they have not spent a single penny on it. But we have not received anything (in this regard) in writing.”
He added: “Under the Act they cannot create a dedicated infrastructure, but they can frame a scheme for the welfare of construction workers.”
Under the Cess Act, developers are required to pay cess of 1 per cent of the total cost of construction incurred by the employer. The cess is levied for augmenting the resources of the Building and Other Constructions Workers Welfare Board.
After the meeting, Rai told reporters that he has urged the Centre to increase the minimum monthly wage threshold for subscription of retirement fund body EPFO from the existing Rs 15,000 on the lines of ESIC.
On September 6, the ESIC board had decided to raise the ceiling from Rs 15,000 per month to Rs 21,000.
Rai was of the view that it is necessary to raise the limit in view of the decision to hike minimum wage by the Centre as well as the Delhi government.