Unorganized welfare

Unorganized welfare
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First Published: Sat, May 26 2007. 12 40 AM IST
Updated: Sat, May 26 2007. 12 40 AM IST
The Union cabinet has cleared a proposal to provide social security to the 370 million workers in the unorganized sector.
As ever, the big question is how much it will cost. The initial reports do not offer an explicit number, but we can guess. It is expected that the beneficiary workers will pay one rupee a day to get health and pension cover. The government will add another rupee. A third rupee will come from tax payers.
So work it out. A payment of one rupee a day to 370 million people will add up to around Rs13,000 crore a year, or about 0.3% of GDP a year. That’s not as small as it seems, considering that the government is cutting its deficit by that amount every year.
One more thing is unclear: Why assume that every worker in the unorganized sector is destitute and needs help from the government? And that, too, when poverty is declining?
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First Published: Sat, May 26 2007. 12 40 AM IST
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