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Modi Govt makes tactical retreat on labour laws

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The battle on labour reforms between some of Narendra Modi government’s ministers and the Bharatiya Mazdoor Sangh ( BMS), the trade union arm of the Rashtriya Swayamsevak Sangh ( RSS), is increasingly reminiscentofthestormyrelationsbetween the two sides during the Atal Behari Vajpayee- led NDA government.
Finance Minister Arun Jaitley has had to withdraw several proposals because of the pressure from unions. Some of these being the rollback of tax on Employees Provident Fund ( EPF) withdrawals and the rollback of the 0.1 per cent cut in Public Provident Fund interest rates to 8.7 per cent.
The government has also heeded the unions by not increasing the pensionable age from 50 to 55. Recently, the PM and the FM said the labour laws would not be amended without detailed consultations.
In the past few months, the BMS has effectively stalled the labour reforms in Rajasthan by approaching the International Labour Organisation ( ILO).
It has challenged Rajasthan government’s labour reforms under ILO’s convention 81, saying the Assembly amended the labour laws without mandatory consultations with labour unions. The BMS has also protested amendments to labour laws in Haryana.
The BMS representatives met senior officials of the Prime Minister’s Office in May to underline how increased automation has led to jobless growth and the need to focus on labour- intensive Micro, Small and Medium Enterprises, said a Bharatiya Mazdoor Sangh leader.
In 1999, BMS founder Dattopant Thengadi had publicly criticised Vajpayee and opposed reforms. The story seems to be repeating itself a decade and a half later as the BJP- led governments —in Centre as well as states — are facing stiff resistance from the BMS.
On the eve of the Modi government’s two years in office, the BMS leadership had met Jaitley. In a press release after the meeting, the BMS claimed that the FM told its delegation “ the government has realised that labour reforms are not essential for Industrial growth in the country.” According to BMS leaders, there were nine participants in that meeting — four from BMS and four ministers from the inter- ministerial group on labour — Jaitley, labour minister Bandaru Dattatreya, power minister Piyush Goyal and petroleum minister Dharmendra Pradhan. Labour Secretary Shankar Aggarwal was also present in the meeting.
According to sources, not all in the government were happy with the BMS press statement.
“There was a sense that the BMS took editorial liberties and should have consulted North Block before releasing the press statement,” said a source in the government.
However, senior BMS leaders told Business Standard they stand by the statement: “Whoever is sceptical about our press statement needs to only wait for the events to unfold in months to come,” a senior BMS leader said.
Business Standard New Delhi,08th June 2016

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