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Mainstream, VOL L, No 33, August 4, 2012

Pension for the Elderly: It’s no Charity, but a Human Right

Thursday 9 August 2012, by Rajindar Sachar

It is a truism, though painful, that the Central Government’s priorities in fiscal matters are determined by the perceived sensitivities of the foreign and Indian corporate sector and the richer class rather than the urgent and humanitarian considerations for the poor and old citizens of India. How I wish that instead the government was to show urgent attention to the plight of about 10 crore elderly people (eight per cent of the Indian population, with one-sixth of them living without any family support)! No doubt, under the Central Government’s pension scheme, persons above the age of 60 get a pension of Rs 200 and those above 80 years Rs 500 per month, but this is applicable to those below the poverty line. The uncertainly is increased by the ever-fluctuating determination by the government of what should be the poverty level: pensions vary in different States—Delhi paying a maximum of Rs 1000 per month while others like Andhra Pradesh, Bihar, etc. only Rs 200 per month.

Of the total elderly population, only 1.97 crore are beneficiaries of IGNOAPS, which means that only about one in every five persons over 60 years receives old-age pension.

Employment-linked pensions are restricted to the elderly in the organised sector or to those who are among the rich and upper middle class categories. But the groups that are most in need of old age pension are largely in the unorganised sector. Between the years 2000 and 2010, the organised sector added less than 0.3 per cent workers annually to the workforce while the GDP of the country more than doubled with an annual rate of more than 7.55 per cent. It is clear that much of the contribution to this growth came from the workers in the unorganised sector. But unlike the organised sector, workers in the unorganised sector do arduous manual labour often in the most difficult physical circumstances and without adequate nutrition and rest. Forcing them then to work beyond the age of 55, in order to survive, amounts to a form of punishment. The demand for old-age pension is thus not a demand for charity but a demand for recognition of their contribution to the economy, and the need-based constitutional principles which are to be applied. As Chief Justice of India S.H. Kapadia has expounded in the Human Rights Year Book 2011,

What is the need-based approach? Supposing there is no statute but the right to life is involved, is it open to the defence to say tight resource, financial crunch? The answer is ‘no’ because the right to life is there in Article 21 of the Constitution and the defence cannot toll the bell of tight resource. Take the case of food security. Two out of five people are below the poverty line, and if pension is to be paid to them, the government cannot say I have no money. Now this is what I mean by revisiting welfare rights. And that is where if enforceability is there the rule of law will prevail.

The insensitive and negative approach of various State governments and the Central Government to the plight of five crore people in the unorganised sector in the construction industry would show the government’s anti-poor face, especially in the way they have dealt with the report of the Justice V. R. Krishna Iyer Committee given decades back.

One of the key recommendations (which on paper has even been accepted by the Government of India though it has persistently refused to enforce it) is the manner in which the scheme of contribution by the employer along with a contribution by the employee is to operate.

Now as the construction industry worker is a migrant and has necessarily to be on the move for finding employment, it was accepted by the government that the contribution of the employer and employee will be deposited in a computerised bank account with a specific identity number for each individual workman. This was so decided because construction labour being migratory, if a new account was to be opened every time with separate employers, his past accumulation was in danger of becoming unrecoverable. So, the way suggested was that each employer will deposit his contribution in a fixed numbered identity account given to the employee, and this will be honoured by all banks anywhere in the country. But this not having been done, the result is that a sum of at least Rs 5000 crores of the Employees Provident Fund is lying in banks but has not been disbursed to the workers because the government has not yet allotted them their identity account numbers. The result is that lakhs of workers are continuing to be near the starvation line.

Another callous indifference of the government is shown by the fact that though all government contracts provide for the contractor to make temporary but proper accommodation for the construction labour at the site, it is common knowledge that contractors mixed up with dishonest inspectors do nothing of the kind—forcing female workers to use open toilets and leaving children to the vagaries of weather with no shelters built. A simple solution is for the government itself to provide these facilities and adjust funds at present being given to the contractors. In spite of protests by workers, nothing has moved—probably, the contractor-inspector nexus is all too powerful.

The Central Government has unapologetically announced many concessions for the corporate sector and the rich with the shameful claim that prosperity so generated will move down and improve the condition of the poor. This is a false claim as given in a warning by the Noble Laureate, Joseph Stiglitz, “The theory of trickle-down economics is a lie.”

According to the ILO’s 2010-11 World Social Security Report, the ILO’s new recommendations on social protection set nationally defined guarantees aimed at universal access to minimum income security, especially during old age, and that such guarantees are a human right and an ethical imperative of governments. How can the Central Government remain silent?

Governments cannot negate the claim for pensions for the old by pleading that development has to take precedence over poverty reduction. This is a specious argument that shows that poverty is a long-term problem and that current deficits represent a short-term emergency, that poverty can wait but deficits cannot. This is muddle-headed thinking. To reduce and eliminate massive absolute poverty lies at the very core of development itself. It is critical to the survival of any democratic and decent society.

The author is a former Chief Justice of the Delhi High Court.

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