'Industry and labour should and must work together'

The issues before this 43rd session of the Indian Labour Conference are of great contemporary relevance to our country. They include the impact of the global economic crisis on employment and welfare of our workforce, the problems of contract labour and employment generation and skill development. These are issues which impinge directly on our quest for inclusive growth.

Over the last six-and-a-half years or so, the UPA government has endeavored not only to make our growth faster, but also to make it more inclusive. The welfare of the Aam Aadmi—our farmers, our workers, our artisans, the poor and the disadvantaged has always guided our policies and programmes during this period. We have launched innovative schemes for promotion of rural employment in healthcare and in skill development. There have been many successes in our initiatives for social and economic inclusion. But we need to do much more. We stand committed not only to creating more employment but also to social security and welfare of our workers. We stand committed to economic reform with a human face, in which the interests of the weaker sections of our society are effectively protected. But our ability to devote more resources for social welfare activities depends crucially on our ability to accelerate the pace of economic growth. We need, therefore, sustained growth of 9-10 per cent per annum to make a serious dent on poverty, unemployment and under development.

Here, I would like to repeat what I have stated earlier also on a number of occasions. Both industry and labour should and must work together to remove the barriers to faster economic growth and to faster growth of employment. Our regulatory framework in the labour sector should encourage investment in labour intensive industries. It should also ensure the well being of our workers. Simultaneously, it should make our industry more competitive by enhancing productivity. It is also important that the gains of enhanced productivity are equitably shared among shareholders, workers and consumers at large. I hope this broad perspective will guide the deliberations of this important conference.

Our quest for faster and more inclusive growth requires us to be constantly watchful. We should constantly introspect whether our policies are serving our goals. We should reflect upon possible flaws in our policies as well as ways to strengthen policy to withstand adverse circumstances. This reflective and critical perspective is particularly important as we think about our policies for labour and industrial relations. We have the welfare of all workers in mind, those in the organised sector of course, but also those in agriculture, in self-employment, in part-time jobs and in seasonal work. Therefore, we need to think about ways to make their productive lives more secure and sufficiently remunerative and also intrinsically satisfying.

I am very happy that the conference deliberations this year include the subject of contract labour. Besides thinking about providing social and economic security to such contract labour, and indeed to all citizens of this country, this may be the time to ponder about wider issues. For example, we have enacted several progressive labour laws since independence and some even before that. But it appears that not all these laws have had the intended good effects that we would like to see on the ground. We need to consider the possible role of some of our labour laws in contributing to rigidities in the labour market which hurt the growth of employment on a large scale. Is it possible that our best intentions for labour are not actually met by laws that sound progressive on paper but end up hurting the very workers they are meant to protect? Do we have empirical evidence on the changing nature of employment generation with changes in labour legislation, not just in our own country but in the neighbourhood as well? If we want to draw more and more workers into the organised sector where they can claim the benefits that currently cover such a very small proportion of our labour force, do we need to rethink the nature of the laws that enforce such benefits?

I cannot think of a better forum for such deliberations than the Indian Labour Conference. Its members share the goal of promotion of labour welfare, have the technical and intellectual expertise to dissect and analyse policy option, and the ability to hammer out new suggestions for labour welfare in a rapidly changing economy.

Edited exceprt from Prime Minister Manmohan Singh’s address at the Indian Labour Conference, in New Delhi on November 23