The Hindu Business Line : Welfare fund for Kerala construction workers needs fine-tuning: ILO

Despite this, the Fund's coverage in some districts of the State needs to be improved, accompanied by measures to create more awareness about the Fund, says a recent working paper published by the International Labour Organisation (ILO).

The paper also recommends several measures to improve the finances of the Fund, administrative measures to reign-in expenses and steps to enhance the benefits offered by the Kerala Construction Labour Welfare Fund.

Prepared under the ILO's sectoral activities programme, the working paper was authored by Dr R.P. Nair of the Thiruvananthapuram centre of the New Delhi-based Institute of Social Sciences.

The paper is based on secondary data collected from various sources including the offices of the Kerala Construction Labour Welfare Fund and the State Planning Board, and augmented by field research in two districts — Thiruvananthapuram and Thrissur.

The paper suggests several steps to improve the Fund's financial position. At present, revenue streams for the Fund include contributions from registered construction workers, a cess on employers such as contractors and builders, licence fees levied on contractors and other sources such as interest from fixed deposits, the study explains.

Whenever a worker retires, his or her contribution, plus the interest earned on this amount and a lump sum from the Fund is given to him/ her. In addition, every retired member receives a monthly pension, the paper adds.

This benefits-structure is a drain on the Fund, says the working paper. Instead, it suggests that the old age pension paid to retired construction workers be continued and perhaps even increased slightly. However, the practice of refunding the workers' contribution should be stopped, says the paper.

The revenue generated by collecting contributions from workers should be transferred to a separate reserve fund and can be used to make the pension payments and even fund more benefits.

The paper points out that the Fund's finances are also affected by the delays and difficulties experienced in collecting the employers' contributions from builders and contractors. In order to solve this issue, the study suggests that the task of collecting this amount be entrusted to the Kerala Construction Labour Welfare Fund itself.

Kerala currently has some 19 welfare funds for workers in different segments of the unorganised sector, the paper points out. Integrating these bodies into a single welfare fund with separate departments to cater to different groups of workers is a feasible proposition, the paper says. Such a compact welfare fund will not only help to bring down costs, but will also improve efficiency, the study adds.

Another suggestion outlined in the working paper is that the benefits available to members of the Fund be enhanced. This demand was articulated by many construction workers who were interviewed as part of the study.

Many of them suggested that a separate amount should be set aside for funding medical care for serious illnesses such as cancer or heart disease. Similarly, many workers also wanted improved educational benefits and better maternity benefits for women members.

The working paper also suggests measures to control administrative expenses, especially staff salaries and reformation of the system used to remit benefits to members of the Fund. Another suggestion put forward in the paper is that steps be taken to strengthen the database of the Fund.

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