Why in news?
There is an ongoing PIL in the Supreme Court between Swaraj Abhiyan versus Union of India.
What is the PIL about?
- The PIL is about the lack of functioning of social security systems like the National Food Security Act (NFSA) and the National Rural Employment Act (NREGA).
- The NREGA mandates that every worker must receive her wages within 15 days of completion of a workweek.
- If this condition is not met, a delay compensation is to be paid at a rate of 0.05% per day of delay.
- In spite of this merely 21% of the sampled transactions were paid within the stipulated 15-day period.
How is the payment made?
- Under the National Electronic Fund Management system (Ne-FMS), upon completion of a work week, a Funds Transfer Order (FTO) is generated at the block/ panchayat.
- Then the Centre approves the FTO digitally.
- Then the money is transferred directly to the individual workers’ account.
- The time taken till FTO generation is the state’s responsibility and the time taken thereafter is the Centre’s responsibility.
What constitute the delays?
- Definition of Delay - The current definition of the delay calculates delay days only until the FTOs get generated at the block/ panchayat.
- The times taken by the Centre to process the FTOs and release wages are not getting accounted as delays.
- Payment Infrastructure - In an attempt to improve the payments process, the government migrated to the Ne-FMS in April 2016.
- Prior to the Ne-FMS system, the state governments would use a contingency/ revolving fund to make the payments until the Centre sanctioned the funds.
- The current payments system is completely centralised.
- The state governments cannot pay the workers even if they intend to.
What should be done?
- Not only has the government violated the law but also the worker's rights to timely wages.
- The payments infrastructure requires seamless coordination between the Centre, states, payment agencies, and the administrative bodies.
- There should also be a clearly defined responsibilities for each one of them.
Source: Business Standard
