Don’t pay contractors who do not adhere to labour welfare norms: CAG tells Rlys

THE HINDU BUSINESS LINE Our Bureau Updated on January 08, 2019

During 2016-17, the Railways made contractual payments of ₹35,098 crore - AFP

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The Railways, as a principal employer, should not pay bills to contractors who do not adhere to labour welfare norms, the government auditor has recommended in its latest report — Compliance to Statutory requirements in engagement of contract labour by India Railways for the year ended 2017.

The welfare norms include registration with the Labour Department, Employees Provident Fund Organisation (EPFO) and Employees State Insurance Corporation (ESIC).

“For the contracts which are already in progress, the Railway Administrations of all Zonal Railways may consider directing the Principal Employers in various contracts to examine the number of contract labour under their jurisdiction in the preceding 12 months, determine if they are required to register themselves with the prescribed authorities under the Acts and get themselves registered with the prescribed authorities, where required,” it added.

Auditors said data was not made available for almost a third of 463 contracts in selected Railway formations. Contracts for which data was unavailable were valued at almost a fourth of the 463 contracts valued at ₹873.40 crore.

Of the balance 312 contracts valued at ₹649.10 crore involving 8,998 contract labour, in 210 contracts valued at ₹408.20 crore, there was an adverse impact of ₹26.14 crore on 6,366 contract labour. This worked out to 4.02 per cent of the value of 312 contracts.

To pay extra

The Railways will have pay an extra ₹1,410 crore, on its total payment of contract of ₹35,098 crore, the report said.

“During 2016-17, the Indian Railways made contractual payments of ₹35,098 crore. Based on the audit in 312 contracts, there was an adverse impact on contract labour at 4.02 per cent of total contractual payments. The estimated adverse impact on contractual payments in Indian Railways will thus be 4.02 per cent of ₹35,098 crore — ₹1,410.94 crore,” said the report. Preparation of estimates for labour component may be done duly taking into account the minimum wages fixed by Central, State Government from time to time plus additional amount of contribution required to be made by the contractors towards EPF, ESIC and any other related cost, the auditor said.

CAG added that the Railways should bring in the incentives under the newly introduced Pradhanmantri Rojgar Protsahan Yojana to promote recruitment of unemployed persons and bring into books the informal employees.

In another report on the performance audit of ICD and Container Freight Station, an analysis of uncleared cargo revealed that pendency was mainly due to delays in issue of no objection certificates by the Customs department, delay in clearance certificates from participating agencies such as plant quarantine and pollution control agencies, delay in implementing orders for destruction of cargo and delay in re-export of containers, it added.

The CAG has also recommended that a Web site on ICDs and CFSs may be developed by the Department of Commerce where updated database and real-time information on operations of ICDs and CFSs could be accessed by all stakeholders.