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Budget 2019: For unorganised sector, Rs 3,000 monthly pension

Goyal also announced a “substantial increase” in the Budget Estimate for welfare of SC and ST communities — an increase of 35 per cent and 28 per cent, respectively.

Written by Shalini Nair | New Delhi |
Updated: February 2, 2019 11:46:49 am
union budget, budget explained, budget key points, piyush goyal budget, Construction workers, Construction sector, unorganised sector, unorganised sector budget, Pradhan Mantri Shram Yogi Maandhan scheme, budget key highlights, Lok sabha election, general election, budget farmers, budget key points, indian express Workers ready a pontoon bridge for devotees at the Kumbh Mela in Prayagraj. Construction workers are part of the unorganised sector which will benefit from the Pradhan Mantri Shram Yogi Maandhan scheme, under which they will be eligible for a monthly pension of Rs 3,000 after 60 years of age. (Express photo by Tashi Tobgyal)

FOR THE social sector, the most significant announcement in the Interim Budget on Friday was “a mega pension yojana” for workers in the unorganised sector with a monthly income of up to Rs 15,000. Under the scheme, they can get a monthly pension of Rs 3,000 after 60 years of age.

While Finance Minister Piyush Goyal, in his speech, made specific references to “substantial increase… for welfare of the Scheduled Castes and Scheduled Tribes” (SC/ ST), reaching “the most deprived… Denotified, Nomadic and Semi-Nomadic communities” (DNT/ NT/ ST), and “women-led development”, there wasn’t much in terms of allocation to these sectors.

Goyal said the Pradhan Mantri Shram-Yogi Maandhan — the pension scheme for unorganised workers earning up to Rs 15,000 per month, including construction labourers, domestic workers, rickshaw-pullers, agricultural labourers etc — is expected to benefit 10 crore workers in the next five years, “making it one of the largest pension schemes of the world”.

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Under the scheme, the Union government will match the nominal monthly deposit made by the workers. Goyal explained that a worker joining the scheme at the age of 29 years will have to contribute Rs 100 per month until he is 60 years old; if he joins at 18 years, the monthly contribution will be just Rs 55. The government will deposit a matching amount in the pension account of the worker every month. The worker will then get an assured monthly pension of Rs 3,000 after reaching the age of 60 years. “Half of India’s GDP comes from the sweat and toil of 42 crore workers in the unorganised sector… We must provide them comprehensive social security coverage for their old age,” said Goyal, announcing an initial allocation of Rs 500 crore.

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Another major announcement was the setting-up of a committee, under NITI Aayog, to identify the DNT/ NT/ SNT communities that have not yet been formally classified as SC, ST or OBC. Saying that the condition of these “hard to reach, less visible, and therefore, frequently left out” group “merits special attention”, Goyal said a Welfare Development Board, under the Ministry of Social Justice and Empowerment, will be set up to implement welfare schemes for them. While this is the second time, after the 2014-15 Budget, that these marginalised communities have been mentioned in the Budget, no new provision has been made for them this time — the 2014-15 Budget made allocations for scholarships and hostel facilities.

Goyal also announced a “substantial increase” in the Budget Estimate for welfare of SC and ST communities — an increase of 35 per cent and 28 per cent, respectively.

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While the word ‘women’ was mentioned nine times, including a reference to ‘women-led development’, the Rs 5,000-crore increase in the Budget Estimate for the Ministry of Women and Child Development is mainly in the core Integrated Child Development Scheme (ICDS). This is because much of the ICDS spending goes towards the salaries of anganwadi workers, for which a hike was announced in late 2018, from Rs 3,000 to Rs 4,500 per month.


Income cap on pension scheme may leave out urban poor

THE PENSION scheme for workers in the unorganised sector is a welcome step, but the income cap of Rs 15,000 per month may be a hurdle. Even if the government finds a foolproof way of verifying the income of unorganised workers, many of the urban poor including domestic workers, especially in the metros, may be left out. Finance Minister Piyush Goyal made sure to mention the 10 per cent quota in jobs and higher education institutions for Economically Weaker Sections in general category, introduced with an eye on the upper caste vote bank. But, in a balancing act, he also made references to how much is being done for SCs and STs, as well as for the Denotified, Nomadic, and Semi-nomadic communities. However, this was not reflected in the budgetary provisions for these communities, as also for women.

Similarly, despite the Rights of Persons with Disabilities Act 2016, there is no substantial increase in allocation, and the disability pension remains Rs 300 per month, ignoring the longstanding demand for an upward revision.

Meanwhile, reacting to the Budget, Paul Divakar, general secretary of the National Campaign for Dalit Human Rights, said: “As per rules, of the eligible schemes in the overall Budget, the SC component is supposed to be 16.6 per cent and ST component 8.6 per cent. However, the allocation comes to merely 8 per cent for SC and 5 per cent for ST. There is denial of Rs 62,000 crore for SC and Rs 25,902 crore for ST. Last year too, the allocation was far below the required percentage. So any claims of an increase over last year has no meaning.”

Avani Kapur from Accountability Initiative at the Centre for Policy Research said neglect was evident in the Pradhan Mantri Matru Vandana Yojana (maternity benefit scheme). “The initial allocation was severely criticised for being way lower than required and for covering only the first child. Still, of the Rs 2,400 crore that was allocated for it in 2018-19, only half i.e. Rs 1,200 crore was spent as evident in the revised Budget. This year, the Budget Estimate is Rs 2,500 crore, a very marginal increase, and, given the trend so far, the spending may be even lower,” said Kapur.

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