Budget to give priority for skill development

06 June 2014

The government will take up programmes for skill development on a priority basis so as to generate employment opportunities across the country, finance minister Arun Jaitley said at a pre-budget consultation meeting with trade union groups in New Delhi today.

He said the government will give due consideration to the ten-point joint charter of demands given by the central trade unions while formulating the budgetary proposals.

The finance minister was responding to the demands raised by the trade unions which among others included implementation of specific proposals for controlling inflation, investments in infrastructure aimed at raising employment, inflation-linked wages and judicious use of FDI in strategic sectors of the economy.

The trade unions pointed out that the public sector units (PSUs) played a crucial role during the year of severe contraction of private capital investment immediately following the outbreak of global financial crisis. These should be strengthened and expanded. The unions were against divestment of shares of profit making public sector units and wanted the government to provide budgetary support for revival of potentially viable sick PSUs.

Some of the specific proposals contained in the joint memorandum submitted by the trade unions include:

  • Effective measures to arrest the spiralling price rise and to contain inflation through curbs on speculative forward trading in commodities, universalisation and strengthening of the public distribution system (PDS), action against hoarding and rationalisation of the tax/duty/cess on petroleum products;
  • Massive investment, both Plan and non-Plan, in the infrastructure in order to stimulate the economy for job creation, with public sector taking the leading role in order to both generate and  stimulate jobs creation and guarantee consistent income to people.
  • Minimum wage linked to Consumer Price Index (CPI) (not less than Rs15,000 per month) must be guaranteed to all workers, taking into consideration the recommendations of the 15th Indian Labour Conference.
  • FDI should not be allowed in crucial sectors like defence production, telecommunications, railways, financial sector, retail trade, education, health and media;
  • Lifting a ban on recruitment in government departments, PSUs and autonomous institutions, including recent finance ministry instruction to abolish those posts not filled for one year;
  • Creation of new posts keeping in view the new work and increased workload;
  • Proper allocation of funds be made for interim relief and 7th Pay Commission;
  • Extending the scope of MGNREGA to agriculture operations and employment for minimum period of 200 days with guaranteed statutory wage be provided;
  • Regularisation of the massive workforce engaged in ICDS, Mid Day Meal Scheme, Vidya volunteers, guest teachers, Siksha Mitra, workers engaged in the Accredited Social Health Activities (ASHA) and other schemes and universalisation of ICDS as per Supreme Court directions by making adequate budgetary allocations;
  • Take steps for removal of all restrictive provisions based on poverty line in respect of eligibility coverage of the schemes under the Unorganised Workers Social Security Act 2008 and allocation of adequate resources for the National Fund for Unorganised Workers to provide for social security to all unorganised workers, including contract/casual and migrant workers, in line with the recommendations of the Parliamentary Standing Committee on Labour and also the 43rd Session of Indian Labour Conference; redefining and redistribution of BPL at the earliest;
  • Ensuring remunerative prices for agricultural produce and government investment in agriculture to be substantially augmented as a proportion of GDP and total budgetary expenditure, so as to ensure that benefits of the increase reach the small, marginal and medium cultivators only;
  • Budgetary provision should be made for providing essential services, including housing, public transport, sanitation, water, schools, crèche, health care etc, to workers in the new emerging industrial areas; working women's hostels should be set up where there is a concentration of women workers;
  • Requisite budgetary support for addressing crisis in traditional sectors like jute, textiles, plantation, handloom, carpet and coir etc;
  • Increased budgetary provision for elementary education, particularly in the context of the implementation of the 'Right to Education' as this is the most effective tool to combat child labour;
  • The system of computation of Consumer Price Index (CPI) should be reviewed as the present index is causing heavy financial loss to the workers;
  • Income tax exemption ceiling for the salaried persons should be raised to Rs5 lakh per annum and fringe benefits like housing, medical and educational facilities and running allowances should be exempted from income tax net in totality;
  • Threshold limit of 20 employees in EPF scheme be brought down to 10 as recommended by CBT-EPF. Pension benefits under the EPS unilaterally withdrawn by the government should be restored; Government and employers contribution be increased to allow sustainability of Employees Pension Scheme and for provision of minimum pension of Rs3000 pm.
  • New Pension Scheme be withdrawn and newly recruited employees of central and state governments on or after 1.1.2004 be covered under Old Pension Scheme;
  • Demand for dearness allowance merger by central government and PSU employees be accepted and adequate allocation of fund for this be made in the budget.
  • All interests and social security of the domestic workers to be statutorily protected on the lines of ILO Convention on domestic workers; and
  • Rectification of the several irregularities found in collection of cess as well as ensuring their proper utilisation.

Regarding resource mobilization, the trade unions have emphasised on the need for a progressive taxation system to be put in place to ensure taxing the rich and the affluent sections that have the capacity to pay at a higher degree.

The corporate service sector, traders, wholesale business, private hospitals and institutions etc should be brought under broader and higher tax net. Increase taxes on luxury goods and reduce indirect taxes on essential commodities, the unions said.

Concrete steps must be taken to recover huge accumulated unpaid tax arrears which have already crossed more than Rs5,00,000 crore on direct and corporate tax account alone, and has been increasing at a geometric proportion. Such huge tax evasion over and above the liberal tax concessions already given in the last two budgets should not be allowed to continue.

Other suggestions include holding of post budget consultations with the representatives of central trade unions, need for directional change in policies such as stopping of mindless deregulation, encourage entrepreneurship to tackle problem of unemployment, more spending on education and skill development, removal of ceiling on gratuity, bonus and pension etc of workers and following the principle of ''Same work, same wages'' among others.

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