InFormal

1. Abhilasha NS, Arun S, Biswajit Sarmah, Nishant Chavan, Rahul Anthwal
Azim Premji University, Bangalore
Footloose Livelihoods:
Extending social security to the informal sector
Theme - Protecting The Vulnerable: Providing Social welfare to Informal sector
workers

2. 1,455
3,530 3,335 2,500
8,531
13,100
7,374
35,968
4,873
7,172 7,943 7,139
17,808
29,900
25,101
83,270
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
Employment (2008) Projected Employment (2022)
Focus: Identification of bottlenecks in extending social security to construction
workers in Karnataka and feasible interventions to overcome them.
Scope:
Estimated 15 lakh construction workers in Karnataka, Only 3
lakhs are registered so far.
Rs 2000 cr. welfare fund with Karnataka Building and other
Construction Workers Welfare Board (KBOCWWB)
Low registration, inability to attract workers to register.
Issues:
Excessive reliance on trade unions for registration (high fees
charged), low engagement of civil society.
Trade Unions unable to register workers (mostly migrant) at
construction camp sites.
Cards not reaching the registered beneficiaries.
Inadequate manpower at KBOCWWB.
Cumbersome process of claims for benefits.
Poor data storage and analysis.
Problem: Inaccessibility and marginal utilisation of eligible welfare benefits by construction
workers in Karnataka
Construction industry: fastest growing industry
All India Employment Numbers (In ‘000s)
Source: NSDC Skill Gap Analysis Report 2009

3. Engaging
various
stakeholders for
different
constituencies
of construction
workers
Manpower and
Capacity
Building
Automation in
registration and
renewal of
workers, and in
utilisation of
eligible benefits
Proposed Solution
Tackle the problem of low
enumeration and design of welfare
delivery system to access eligible
benefits by the construction workers

4. High Level Description
Engaging various stakeholders for different
constituencies of construction workers
•Trade Unions- in small scale construction sites & non-
migrant construction workers.
•KBOCWWB and NGOs- Large construction sites + migrant
construction workers.
•Plural approach, building on existing systems
•Govt machinery – cumbersome, bureaucratic

Automation in registration and renewal of
workers, and in utilisation of eligible benefits
•Biometric registration, on the spot delivery of cards
through
•Automatic digital data storage/analysis.
•Reduction in paperwork.
•Accessibility of benefits for mobile workers.
•Cost effective in long run.
•Overcomes delays and card non-delivery.
•Electronic claims of benefits.
Solution
•Description
•Rationale
Manpower and Capacity Building.
•Increase the number of employees dedicated to identification
and registration.
•Time bound, dedicated facilitation of registration
•Outsource the technical process of registration.
•Cost-efficient, dedicated team
•Skilled manpower like medical doctors to process medical
benefit claims.
•Rapid settlement of claims
•Review & Monitoring : District Surveillance Committee under
Labour Officer.

5. Data

Central Server
State Server
District Server
Registration Toolkit
On The Spot Card
Delivery
Beneficiary (Proof of
identity, age, doctors
certificate)
District Registration
Authority (DRA)
Worker Identification
Officer (WIO)
(Labour Union/Govt)
Employer
Data

Data

KBOCWWB
REGISTRATION
No. of workers to be
registered
1,000, 000
Time frame 180 days
Registration Toolkit Biometric reader, Camera,,Electricity,
Software
Location/Date/Time
of Registration
Labour Inspectors/
NGOs/Volunteers/Media will identify the
construction site
1.Total districts in Karnataka : 30.
2.The manpower recruited by
board will be engaged in benefit
distribution/renewal/Kiosk
offices after registration is over.
3.Every registration centre will
have equipment to issue
biometric card on the spot of
registration.

6. Category of Expenditure
Nos/Units
Required
Annual Cost Total Cost
I. Fixed Infrastructure
Central Server at state
level
1 1,000,000 1,000,000
District Server/Kiosk
Cost
30 200,000 6,000,000
II. Manpower (Over and above present strength)
Salary of the Additional
Executives.
30 300,000 9,000,000
Salary of Additional
Technical Operator.
30 180,000 5,400,000
Office
Rent/Maintenance
30 600,000 18,000,000
III. Biometric Registration and Card Issuance on the spot
Registration/card
Issuance Cost

1,000,000
120 120,000,000
IV. Total Expenditure 159,400,000
Business Contingency Plan
•Reissuance of lost card
•Reporting of lost card
•Addition and deletion of members
•Subscription of members
•Photo/Thumb impression correction
•Any other error correction
Registration Process
•Awareness and intimation slips will be given to
all the sites before registration day (RD).
•On the RD kits, manpower, WIO will visit the
site.
•Every registration site will have WIO to
authenticate the registrations.
•Worker will pay the registration fees along with
relevant documents to get his biometric data
submitted and receive a card on the spot.
•Auto-digitized registration data will be loaded in
the District Servers which will be further
connected to State Server.

7. Impact
All amounts in Indian Rupees | No of Registrations for 2015-16 & 2016-17 considered constant as of 2014-15 | Projected Benefits payout from last 5
years growth trend. (Sources: KBoCWW)
Estimated Benefits In Successive Years After Proposed Registration
Tangible Intangible
10 lakhs enrolment in 6 months.
Benefit payout of Rs. 41 Cr in 2014-15 and 151 Cr in 2016-17.
Highest benefit distribution in Children Education, Funerals &
Health.
Greater availability of social credit/insurance due to
expectations of benefits from the govt.
Reduction in the burden of health expenditure.
Open up avenues for educaitonal opportunities.

2012-13 2014-15 2015-16 2016-17
No of registrations
No of
Claims
Amount Paid
No of projected
registrations
Projected
Payout
Projected
Payout
Projected
Payout
Education
270000
6420 13964200
1300000
35,290,224 278,200,000 556,400,000
Marriage 894 8365000 19,565,657 95,382,576 143,073,864
Maternity 99 594000 1,375,000 8,937,500 13,406,250
Hospitalization on
Illness 159 133750 856,329 1,284,493 1,926,739
Major Illness 154 4495555 28,661,989 42,992,983 64,489,475
Death 79 6309000 39,304,938 58,957,407 88,436,111
Funeral 553 10362000 285,387,686 428,081,530 642,122,295
Total 8358 44223505 410,441,823 913,836,489 1,509,854,734

8. Before and After Scenario
Issue Existing processes
After Implementation of proposed
solution
Manpower of
Governement
KBOCW with officers in deputation
and contract executives
KBOCW with full time officers and
increased and specifically skilled
executives – medical, social, etc.
Registration Agency
Registration through Trade
Union/NGO/Dept. in for the
Construction workers.
Trade Union: Focus on local
construction workers.
KBoCWWB/NGO: Migrant
construction workers, big project
sites
Registration &
storage of Data
Cumbersome Paperwork, expensive
for construction worker, loss of wage,
delay/no delivery of cards
Biometric registration and card
delivery on the spot, robust
electronic data
Benefit Accessibility Difficulty in accessibility
Construction workers can avail
benefits from anywhere.
Amount of Benefits
Rs. 4.42 Crore of welfare benefit
distribution.
Annual benefit distribution of Rs.
41 Crore after one year and Rs.
151 Cr. after two years.
Mode of remitting
benefits
Direct credit to account of
beneficiary but no didgital records to
curb misuse.
Direct credit of benefits to account
and maintenance of data to avoid
fraud /duplicate claims.

9. Replicability and Scalability
To Other States

•Depending on the size of labour
force in construction industry.
•Strength and constituency pattern of
Trade Unions and NGOs.
•Presence of migrant labour force
may need special strategy.
•Build inter-state coordination to
extend benefits to workers.
To Other Informal Sectors

Participants:
•Identification by existing bodies
working with the workers of sectors
e.g. Street Vendors Union, Resident
Welfare Association (RWA) etc.
•Regulatory and welfare body as per
specific Acts.

Funds:
•Registration fees, employer’s
contribution, government grants.

Process:
•Biometric, on the spot registrations.
To other welfare schemes:
•Data of registered workers can be
used to secure benefits other from
schemes such as Rashtriya Swasthya
Bima Yojana (RSBY) etc.

•Respective state welfare boards can
use the data of registered workers to
promote modular education among
children of informal sector by
leveraging unique educational
resources by NGOs and pvt sector
e.g.- Azim Premji Foundation
1

10. Political Challenge
•Access of benefits by migrant construction
workers in their home state without
collaboration among states.
•Prospects of demand from other sectors
which have scarce funding sources.
•Full autonomy to such a huge fund
bearing board i.e. KBOCWW is difficult.

Economic Challenge
•When maximum number of workers are
registered, the pilferage through
fraud/duplicate claims will be high in
absolute numbers.
Legal Challenges
•Challenges of identification of age of
worker in absence of document . Impact
on pension etc.
•Termination of contract of registration
agency is not easy in case of defaulting.

Social Challenge
•Possibility of misusing the scheme by local
power-lords.
•Lesser registration of female construction
workers.

Technological Challenges
•Technological failures due to electricity ,
machine breakdown.

Challenges & Mitigation Factors

11. Semi-structured interviews with construction workers (migrant and local) in Bangalore.
Interactions with officials of the KBOCWB, Trade Unions, etc.

The Challenge of Employment in India: An Informal Economy Perspective: Volume I - Main Report, National
Commission For Enterprises in the Unorganised Sector, New Delhi: Dolphin Printo Graphics, April, 2009
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Institute for social and economic change, Working Paper- 169, 2006.
Prasad, R.S. Nithin et al, A Study on Building and Other Construction Workers Welfare Schemes/ Amenities in
Karnataka, SASTech Journal, Volume 10, Issue 1, May 2011, pp- 59-66.
Sharma, Alakh. N and Dhruv Sood, Migration and Informality, Institute of Human Development, New Delhi <
http://wiego.org/sites/wiego.org/files/resources/files/Sharma-migration_india.pdf>
Report on Conditions of Work and Promotion of Livelihoods in the Unorganized Sector, National Commission
For Enterprises in the Unorganised Sector, New Delhi: Dolphin Printo Graphics, April 2007.
Dreze, J. and A. Sen, Public Action for Social Security: Foundations and Strategy. In E. Ahmed et al (eds.),
Social Security in Developing Countries, New Delhi: Oxford University Press, 1999.
Tiebout, Charles. M, Pure Theory of Local Expenditures, Journal of Political Economy, Volume 64, No. 5,
University of Chicago Press, 1956, pp. 416- 424 URL<http://www.jstor.org/stable/1826343>
References

12. Annexures