ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Workers' Welfare : To Those That Don't Have


The Maharashtra government has decided to shut down three large hospitals of the Employees’ State Insurance Corporation in Mumbai. The reason? They are inefficient, badly run and do not have either adequate staff or budgets. Without a doubt there is much truth in this. ESIS hospitals are by and large in a state of acute disrepair. The truth is that the ESIS as a whole has never been functioning efficiently. Its creation was a political act of a welfare state, which was far more concerned with the huge electorate of people employed in agriculture than the comparatively small cohort of workers in the organised sector. And while the welfare of labour in an industrialising economy was an important concept, none of the stake-holders regarded it as a primary agenda. The political leadership, while paying lip service to the idea of labour welfare by seeking, for instance, periodic expansion of the target population, was far more concerned with larger issues. The state’s dutifully apportioned budgetary fractions did but little to either monitor the efficiency or audit the use of the resources which were being spent. That there were large leakages has always been known, but no effort has been devoted to identifying or plugging them. In a way, the entire system worked because there were leakages. Injury compensation has become a farce: actual sufferers are often left without cover, but the system is systematically milked. The level of inefficiency is such that even a review of the system becomes difficult because of the lack of records. Worse, representatives of labour do not consider the task of revitalising the ESIS worth bothering about. Over the years, even as more hospitals were created and larger numbers came into the system, the structures of care became more or less dysfunctional. The relevant law provided for setting up of boards comprising a specified number of members including representatives of trade unions. While the members were duly appointed, the boards hardly ever meet.

There is thus sufficient reason for closing down the three hospitals in Mumbai. The question is, or should be, the opposite: Why then should not every hospital under the ESIS be closed down? Why in fact should the entire system not be disbanded? It is these questions lurking in the shadows which nobody wants to address in public. Maharashtra’s labour minister, among the few perhaps who have articulated the issue, has pointed out that with the opening up of the insurance sector, there may be a case, and an opportunity, for reviewing the ESIS as a comprehensive care and compensation system. The care component could well be facilitated by the state rechannelling through insurance companies the funds raised as mandatory contributions from employers and confining the ESIS’s role to injury compensation. This might be a politically correct option as well – it retains in place the only large-scale welfare system for workers, but at the same time confines its role to that of an agency for clearing compensation claims.

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