e-Shram Portal: Benefitting Unorganised Workers : Daily News Analysis

Date : 20/07/2023

Relevance: GS Paper 2: Government Policy

Keywords: Social Protection, Code on Social Security 2020, G20,

Context-

Recently, India makes a presentation on e-Shram, the world’s largest database of unorganised workers, and the National Career Service Portal during the 4th G20 EWG meeting.
The Centre introduced the e-Shram portal, aiming to establish a comprehensive national Aadhaar-seeded database for unorganised workers. This initiative is set to facilitate access to various central and state government welfare schemes for these workers, who constitute over 80% of the workforce, including self-employed individuals, migrant workers, and those associated with micro, small, and medium-sized enterprises (MSMEs).

What is Social Security?

Social protection refers to a set of measures and initiatives put in place by governments to support individuals and families, particularly those who are poor and vulnerable, in times of crises and shocks. It aims to help people cope with challenging circumstances, find employment opportunities, enhance productivity, invest in education and health, and provide support for the aging population. Social protection systems play a crucial role in reducing poverty and inequality, promoting social inclusion, and ensuring overall well-being.

As per the World Social Protection Report 2020-22, India's social protection coverage is relatively low, with only 24.4% of the population benefiting from social protection measures. This percentage is even lower than that of Bangladesh, which stands at 28.4%. In contrast, countries like Mongolia, New Zealand, Singapore, and Australia have achieved near-universal social protection coverage.
One of the reasons for the disparity in coverage in India is that contributory schemes are primarily limited to those working in the formal sector, leaving out a significant portion of the population employed in the informal sector. Additionally, non-contributory schemes are often targeted at the poorest, leaving many others without adequate social security benefits.
Despite these challenges, India has made significant strides in expanding social protection coverage through a combination of contributory and non-contributory schemes.

Some of the recent initiatives to improve social protection in India include

Mahatma Gandhi National Rural Employment Guarantee Programme (MGNREGA): This scheme provides a safety net for rural households by guaranteeing up to 100 days of wage employment per year for at least one adult member of each household.
Pradhan Mantri Shram Yogi Maan-Dhan Yojana (PM-SYM): This pension scheme is designed for unorganized sector workers and provides them with a monthly pension after reaching a certain age.
National Pension Scheme for Traders and Self-employed Persons (NPS): This initiative aims to extend pension benefits to traders and self-employed individuals.
Pradhan Mantri Jeevan Jyoti Yojana (PMJJBY): This is a life insurance scheme that offers a death benefit to the nominee of the insured individual.
Pradhan Mantri Suraksha Bima Yojana (PMSBY): This is an accident insurance scheme that provides coverage in case of accidental death or disability.
Atal Pension Yojana: This scheme targets workers in the unorganized sector and encourages them to save for their retirement.
National Safai Karamcharis Finance and Development Corporation (NSKFDC): This initiative provides financial assistance and support for the welfare of sanitation workers.
Self Employment Scheme for Rehabilitation of Manual Scavengers: This program aims to rehabilitate manual scavengers by providing them with alternative livelihood opportunities.

Despite these efforts, there is still a need for further expansion and improvement of social protection measures in India to ensure that a larger proportion of the population is covered and protected against various risks and vulnerabilities.

Regarding the shortcomings in the labor sector, some significant issues include

Informal Sector Coverage: Only about 10% of India's workforce is in the organized sector, leaving the remaining 90% in the informal sector without access to labor law benefits and social security measures.
Use of Contract Labor: The use of outsourced contract labor in industrial plants has grown, leading to contradictions and issues related to job security and benefits.

To address these challenges, the Indian government introduced four new labor codes:

Industrial Relations Code: Seeks to simplify labor dispute resolution and promote ease of doing business.
Code on Social Security: Aims to extend social security benefits to workers in the informal sector and self-employed individuals.
Occupational Safety, Health, and Working Conditions Code: Focuses on improving working conditions and safety standards for workers.
Wage Code: Consolidates and simplifies wage-related regulations.

The recent labor codes aim to address contemporary labor market needs and provide greater flexibility to businesses while ensuring social security for all workers. Some positive features of these codes include fixed-term employment and the goal of covering informal sector workers under social security provisions.

The priority now should be to extend social security to 90% of workers in the informal sector and self-employed individuals. This can be achieved by extending schemes like MNREGA to urban areas, providing unemployment insurance for the informal sector, and implementing skill development programs to upgrade and enhance the employability of workers. Creating a robust social safety net for the entire working population will be crucial for India's success in manufacturing and becoming a major hub in global supply chains

Key Features of the e-Shram Portal:

Inclusive Coverage: The e-Shram portal encompasses a wide range of unorganised workers, such as construction labourers, migrant workforce, street vendors, and domestic workers.
Aadhaar and Bank Account-Based Registration: Unorganised workers can conveniently register on the portal using their Aadhaar and bank account details, ensuring a streamlined and efficient registration process.
Self enrolment: It will be available in public for open access where workers can self-enroll through Aadhaar and mobile numbers.
Single window: This will be a single-point reference to help authorities reach out to and track workers in the informal sector, and offer welfare in times of crisis.
Issuance of e-Shram Card: Upon successful registration, workers will be provided with an e-Shram card containing a unique 12-digit number, serving as their identification and reference for availing benefits.
Social Security Benefits: Registered workers become eligible for social security benefits, including Rs 2 lakh in case of death or permanent disability and Rs 1 lakh in case of partial disability.

Role and Coordination of Various Entities:

Labour Ministry and State Governments: The Labour Ministry and state governments will collaborate to manage the registration process and ensure smooth implementation of welfare schemes.
Trade Unions and Common Service Centres: Trade unions and Common Service Centres will actively participate in facilitating workers' registration and extending support throughout the process.

Importance of Registering Unorganised Workers:

Bridging the Gap: Currently, unorganised workers are either registered under different welfare boards or remain unregistered, leading to disparities in benefit distribution. The e-Shram portal bridges this gap and ensures that migrant workers are not excluded from receiving essential benefits.
Enhanced Targeting and Inclusion: Digitisation under the e-Shram portal enables better targeting of income transfers and enables unorganised workers to be included in various social security schemes, such as pension, provident fund, deposit linked insurance, and maternity and accident benefits outlined in the Social Security Code, 2020.

Challenges and Recommendations:

Financing the Schemes: While the Social Security Code, 2020 outlines various benefits, there is a need for clarity on the financing aspect to sustain and fund these schemes effectively.
Decentralised and Flexible Registration Process: Encouraging the participation of municipalities, panchayats, and civil society groups can lead to a decentralized registration process. Additionally, allowing workers to register at centers of convenience instead of specific offices would enhance accessibility.
Public Awareness: Raising awareness through advertising and educational initiatives is essential to encourage greater participation from unorganised workers.
Integration of Existing Welfare Boards: Efforts should be made to enable workers registered under other welfare boards to easily enroll on the e-Shram portal.
Acceptance of Alternate IDs: Considering alternative national IDs, such as voters' cards, for those without Aadhaar would ensure broader inclusion of workers.
Efficient Data Management: Handling data for over 400 million individuals necessitates robust and efficient data management systems to ensure accuracy and security.

Conclusion:

The e-Shram portal marks a crucial step towards uplifting unorganised workers by providing them with access to various government welfare schemes. This digital initiative is poised to bring about significant positive change in the lives of millions of workers, particularly during challenging times like the Covid-19 pandemic. Proper coordination among stakeholders and sustained efforts are vital to maximize the benefits of this ambitious project.

Probable Questions for UPSC main exam -

What are the specific challenges faced by India in terms of social protection coverage, and how do these challenges impact the population, particularly the informal sector workers? (10 Marks, 150 Words)
How does the e-Shram portal address the existing disparities in benefit distribution among unorganized workers and ensure their inclusion in social security schemes? What are the potential benefits of digitization under this portal? (15 Marks,250 Words)

Source: PIB