Union budgetary allocation for labour welfare schemes 'showing a declining trend'

By Bharat Dogra*
While unemployment is a very serious problem and several initiatives for improving employment prospects are needed, and the budget of the Ministry of Labour and Employment should have seen an increasing trend, in reality this has seen a declining trend in recent years. This is unfortunate as this creates a scarcity of resources at a time when more resources are needed for labor welfare and improving employment prospects.
In 2021-22 the actual expenditure of this Ministry was Rs 24,033 crore. This was reduced to a Budget Estimate (BE) of only INR 16,893 crore in the next financial year 2022-23 which got further reduced to INR 16,117 crore when the Revised Estimate (RE) for this year was prepared. In the BE of next year 2023-24 this was further reduced to Rs 13,221 crore.
Once again this was reduced further to INR 12,521 crore when the RE for this was prepared. In the budget for 2024-25 this has been retained at almost this same figure at Rs 12,531 crore although of course in real terms, after providing for inflation there is a further reduction.
If we compare the actual expenditure of 2021-22 (Rs 24,033 crore) with the BE of the latest financial year 2024-25 (Rs 12,531 crore), then this BE for the latest year is almost half of the actual expenditure in 2021-22.
This is very unfortunate as there is so much to be done by this Ministry but cannot be done due to lack of resources.
Coming to some specific programmes and schemes, Rs 350 crore was allocated for an important scheme called Pradhan Mantri Shram Yogi Maandhan, but at the time of preparing RE this was reduced to Rs 205 crore. In the budget for 2024-25, the BE for this has been further reduced to Rs 177 crore.
There is a Labour Welfare Scheme which had BE and RE of Rs 75 and Rs 102 crore respectively in the previous year’s budget but has been reduced to Rs 50 crore in the latest budget.
For a scheme called National Data Base for Unorganized Workers during 2023-24 a sum of Rs 300 crore was allocated but this was reduced to just Rs 102 crore when RE was prepared. There is one more scheme called Labour and Employment Statistical System for which Rs 110 crore was originally allocated last year but later reduced to RE of Rs 45 crore. Rs 50 crore has been provided in the latest budget.
There is an important project — National Child Labour Project — which provides the potential for doing a lot of much-needed work, a lot of good work, and what is more this is supposed to be implemented with the help of voluntary organizations.

This also provides for reimbursement of assistance to bonded labor. For such an important scheme at national level only Rs 20 crore was provided in the previous year. Even this was reduced to only Rs 13 crore in the RE and this year only Rs 6 crore has been provided.

Rural labour scheme

People frequently complain that the information they receive on budgetary allocation for labour welfare from various sources is confusing, and sometimes even contradictory. Why does this happen?
This question can be answered to a significant extent by considering a very simple example. The real-life data for the rural employment scheme under MG-NREGA for last year shows that the original allocation for this was Rs 60,000 crore, but later this BE was increased to RE of Rs 86,000 crore.
The BE for 2024-25 is also Rs 86,000 crore. So what anyone supportive of this can say is that last year RE was higher than BE and this year the BE is higher than the BE of the previous year, hence scoring on both the points.
However, critics here are on a more solid ground when they assert that all these three figures are much below the requirements of the employment guarantee scheme, calculated on the basis of 100 days employment and wage of the number of people who have job cards and are known to seek employment on the basis of the previous data.
They go back to the actual expenditure of Rs 98,467 crore in 2021-22 to reveal a decline trend in real as well as nominal terms. In fact, in real terms a decline can be shown even when comparing the RE and the BE for the two latest years -- same in money terms but a decline in real terms.
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*Honorary convener, Campaign to Save Earth Now. His recent books include "When the Two Streams Met" (on freedom movement), "Man over Machine" (on Gandhian ideas for our times) and "A Day in 2071"

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