Thank you , Shri Rajiv Kumar [ NITI
Aayog ]
Thank you for suggesting setting up of “ Labour Utilization Fund “
I refer to the following
news report in today’s Hindustan Times :
“ NITI aayog proposes scheme to save jobs
from automation “
Federal think tank
NITI Aayog has proposed that the government set up a labour utilization fund that will make the
country’s workforce more skilled and cost-competitive, encouraging businesses to hire more at a time when automation
and the use of artificial intelligence are making low-skill labour redundant.
NITI Aayog vice-chairman
Rajiv Kumar said in an interview that the government should consider setting up
the fund, which will foot
the bill for skilling workers and providing them social security, making
workforce more cost-competitive for the industry to employ.
Kumar suggested that instead
of capital subsidy for businesses, there was a need for labour subsidy now.
“Just like that, we should have a labour utilization fund.
It doesn’t have to
pay salaries but can be
used for better training, for paying provident fund contribution and for
covering the health costs. In advanced economies, all these things are provided
by the public sector,” said Kumar.
Since social security benefits in India do not match those in
developed economies, there is a need for a dedicated policy and schemes to lower labour costs,
said Kumar, adding that it will also help bridge income inequality in the
country.
“The objective of our policy
should be maximizing
employment generation. If you do that, everything will fall in place,”
said Kumar
Dear Shri Rajiv Kumarji :
While drawing up the
details of the proposed “ Labour Utilization Fund
“ , I request you to consider incorporation of my following suggestion ( sent earlier as Email )
I do hope you can convince Shri Jaitleyji to announce
this in his Budget Speech on Feb 01 , 2018
WHAT WOULD BE THE RIGHT APPROACH ?
* Right approach would be : " Do not give fish to a hungry
man / teach him how to
fish "
In short , empower them to earn their own living by teaching them
" Skills "
and by
gaining " Experience " in use of those skills
Entire cost of this " Skilling " and " Experiencing " to be borne by the Government , till
each targeted poor / unemployed person , either gets gainfully employed
or becomes
self-employed
Should he choose to become Self-Employed ( by registering as a " Start Up " ),
exempt him from paying Personal
Income Tax for next 10 years
------------------------------------------------------------------------------------------------
HOW TO TRANSLATE THIS " SELF HELP "
CONCEPT INTO PRACTICE ?
Divide the implementation in following 3 phases
* Empowering - 3 years ( Imparting Skills in Industrial
Training Institutes )
* Experiencing - 3 years ( Providing experience in Ind / Commercial Establishments )
* Self-dependence Phase ( Working in a gainful job or as Self
Employed )
-------------------------------------------------------------------------------------------------
WHAT SKILLS WILL GET PROVIDED IN ITI ?
Entire range of Manufacturing Industry related skills being currently
imparted plus a
whole host of commercial skills required by E Commerce / Fintech /
Agriculture
Processing / Payment Banks / Service Sector / BPO / Telecom and emerging
sectors
------------------------------------------------------------------------------------------------
HOW SHALL WE MOTIVATE UNEMPLOYED YOUTH TO JOIN ITIs
?
* Each trainee will receive Rs 1000 pm ( for course duration of 3 years )
This amount will get deposited in Jan Dhan bank account of trainee ( DBT )
HOW CAN WE GET PRIVATE SECTOR PARTICIPATION IN THIS
PHASE ?
* If a Private firm or individual comes forward to set up such a
Training Institute ,
# Treat it as an Infrastructure
SPV
# No questions asked as to the source of funds for
setting up such ITI
{ a
kind of Amnesty Scheme to convert Black Money into White Money }
# A government grant of Rs 1,000
pm per trainee to such SPV ( DBT in Bank A/C )
If this is done , expect 10,000 SPVs to come up
within one year and 10
million youth
to get trained each year !
HOW CAN WE GET INDUSTRIAL AND COMMERCIAL
ESTABLISHMENTS TO PROVIDE
EXPERIENCE TO TRAINEES PASSING OUT OF ITIs ?
* Amend Apprenticeship Act
* Allow all Industrial and Commercial Establishments to engage ANY NUMBER of
apprentices ( without upper
limit ) , for a period of 3
years
* Starting stipend = Min of Semi-Skilled wages ( currently , approx Rs 6,000 pm )
* Annual Increment = 5
%
* Establishment to pay 75 % of stipend
* Government
to pay 25 % of stipend ( DBT into Jan Dhan account of the
Apprentice )
-------------------------------------------------------------------------------------------------
HOW CAN WE ENSURE A " LEAKAGE PROOF "
DISBURSEMENTS OF DBT AMOUNTS ?
* Through implementation of Mobile based Attendance System , outlined in
my blog,
" From BAD to MAD "
[ 01 Jan 2016
]
HOW WILL MY SUGGESTION HELP ?
* It will solve the problem of poverty organically / permanently
* It will prevent " Dependency Culture " ( looking up to Sarkar
Maa Baap for
everything )
* It will enable poor to retain their " Self Respect / Dignity
"
* The money spent by government will create highly productive
" Human Assets
"
* It will overcome the " Skills Shortages " experienced by the Economy
* It will create gainful " Self Employment " for millions of poor
* It will make India , a " Low Cost Economy " , able to export its goods
and services
* It will channelize Black Money into a " Nation Building "
exercise
20 Dec 2017
www.hemenparekh.in
/ blogs