Suboptimal outcomes: On social security boards for unorganised, gig, platform workers

The Constitution places 'Labour' in the Concurrent List (Entry 24) under the Seventh Schedule, meaning both the Union and State governments have the power to legislate on it. The editorial highlights a friction point in cooperative federalism, suggesting the newly constituted boards are excessively controlled by the Union Government. By vesting the chairmanship in the Union Minister for Labour and heavily nominating members from the Centre, the design potentially marginalises the role of State Governments. This centralised approach is criticised for ignoring the diverse, localised realities of the unorganised sector, which states are often better positioned to manage. UPSC frequently tests the tension between the Union's drive for uniformity (e.g., through Labour Codes) and the States' demand for autonomy, making this a classic case study for Mains GS-2 questions on federalism.

The Indian economy is characterised by a massive informal sector, with over 90% of the workforce engaged as unorganised, gig, or platform workers. Providing a social safety net for this demographic is crucial for inclusive growth. The editorial points out the stark gap between the government's claim of expanding social security coverage (from 19% to 64.3%) and the reality that a vast majority of these workers lack basic protections like health care, unemployment benefits, and pension, as defined by the International Labour Organization. The transition to a formalised social security structure via the Code on Social Security, 2020 is a significant economic reform. However, the success of this reform depends on the effective functioning of these boards. If the boards fail to genuinely represent the interests of the workers (due to lack of participation from diverse trade unions), the economic vulnerability of the gig and unorganised workforce will persist, hindering broader poverty alleviation efforts.

Social security is not just an economic measure but a fundamental aspect of human dignity and social justice, often linked to the right to life under Article 21. The editorial references the long-standing recommendations of the National Commission for Enterprises in the Unorganised Sector (Arjun Sengupta Committee), which advocated for comprehensive measures to protect informal workers. The current structure of the boards, while a step forward, faces criticism for potentially inadequate representation. Effective social dialogue—involving genuine representatives of employers, workers, and the state—is essential for designing welfare schemes that actually reach the beneficiaries. When large segments of the workforce, particularly the rapidly growing gig economy workers, are excluded from robust social protection mechanisms, it exacerbates social inequalities and creates a precarious underclass. For UPSC, understanding the mechanisms of inclusion and exclusion in welfare administration is key for GS-2 (Social Justice).