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Mainstream, VOL 62 No 5 February 3, 2024

Shrinking Size of the Labor Ministry’s Budget is A Cause for Serious Concern | Bharat Dogra

Saturday 3 February 2024, by Bharat Dogra


Many-sided initiatives for labor welfare are needed in India. Unemployment is a very serious problem and several initiatives for improving employment prospects are needed. Hence the budget of the Ministry of Labor and Employment must see an increasing trend.

However 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 INR 24033 crore (one crore=10 million). This was reduced to a Budget Estimate (BE) of only INR 16893 crore in the next financial year 2022-23 which got further reduced to INR 16117 crore when the Revised Estimate (RE) for this year was prepared.
In the BE of next year 2023-24 this was further reduced to INR 13221 crore.
Once again this was reduced further to INR 12521 crore when the RE for this was prepared. In the budget for 2024-25 this has been retained at almost this same figure at 12531 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 ( 24033 crore) with the BE of the latest financial year 2024-25 (12531 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 programs and schemes, INR 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 INR 205 crore. In the budget for 2024-25, the BE for this has been further reduced to INR 177 crore.

There is a ‘Labor Welfare Scheme’ which had BE and RE of INR 75 and 102 crore respectively in the previous year’s budget but has been reduced to INR 50 crore in the latest budget.

For a scheme called ‘National Data Base for Unorganized Workers’ during 2023-24 a sum of INR 300 crore was allocated but this was reduced to just INR 102 crore when RE was prepared. There is one more scheme called ‘Labor and Employment Statistical System’ for which INR 110 crore was originally allocated last year but later reduced to RE of INR 45 crore. INR 50 crore has been provided in the latest budget.

There is an important project—National Child Labor 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 INR 20 crore was provided in the previous year. Even this was reduced to only INR 13 crore in the RE and this year only INR 6 crore has been provided.

Clearly this trend of reducing budget for the Ministry of Labor and Employment should be checked and it should get adequate finds for many-sided welfare initiatives related to workers.

(Author: Bharat Dogra is Honorary Convener, Campaign to Save Earth Now. Hos recent books include Man over Machine (Gandhian Ideas for Our Times, Navjivan and A Day in 2071)

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