Urban unorganised workers represent one of India’s most vulnerable populations, often lacking job security, social protection, and access to basic services. Recognizing this challenge, the government has implemented various policies and programmes aimed at improving their living and working conditions. These measures range from employment generation schemes to constitutional reforms and welfare initiatives.
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Government’s coordinated employment schemes
The Swarna Jayanti Shahari Rozgar Yojana (SJSRY) emerged as a major urban poverty alleviation programme designed to provide gainful employment to the urban unemployed and underemployed poor. Launched on December 1, 1997, this centrally sponsored scheme operated on a cost-sharing basis between the Centre and States in a ratio of 75:25.
SJSRY comprised two main components that addressed different employment needs. The Urban Self Employment Programme (USEP) helped individual beneficiaries and groups of urban poor women establish self-employment ventures. Under this component, eligible beneficiaries living below the poverty line could access projects worth up to Rs. 50,000, with the government providing a subsidy of 15% of the project cost, capped at Rs. 7,500 per beneficiary. The programme also emphasized skill development and training to enable the urban poor to access employment opportunities or undertake self-employment.
The Urban Wage Employment Programme (UWEP) focused on providing wage employment to beneficiaries living below the poverty line by engaging them in constructing socially and economically useful public assets. This programme applied to urban local bodies with populations less than 5 lakhs as per the 1991 Census, maintaining a material-labour ratio of 60:40 while ensuring payment of prevailing minimum wages.
Community-based implementation approach
A distinctive feature of SJSRY was its community-driven implementation through Neighbourhood Groups, Neighbourhood Committees, and Community Development Societies. These community structures were responsible for identifying beneficiaries, preparing applications, monitoring recovery, and generally supporting programme effectiveness at the grassroots level.
However, despite its comprehensive design, SJSRY faced implementation challenges. Given the low allocations, only about 2 lakh urban poor benefited under skill development and 50,000 under self-employment annually. The scheme was eventually replaced by the Deendayal Antyodaya Yojana – National Urban Livelihoods Mission (DAY-NULM) in 2013, which continues with similar objectives of employment and skill development for urban poor.
Constitutional empowerment through the 74th Amendment
The 74th Constitutional Amendment Act of 1992, which came into force on June 1, 1993, marked a watershed moment in urban governance. This landmark legislation mandated the establishment and devolution of powers to Urban Local Bodies (ULBs) as the lowest unit of governance in cities and towns, built on the premise that power in a democracy rightfully belongs to the people.
The Amendment added Part IX-A to the Constitution (Articles 243-P to 243-ZG) and introduced the 12th Schedule containing 18 functional items that could be entrusted to municipalities. It established a three-tier structure of urban local bodies: Nagar Panchayats for transitional areas, Municipal Councils for smaller urban areas, and Municipal Corporations for larger urban areas.
Limitations for unorganised labour
While the 74th Amendment empowered urban local bodies with the authority to legislate and implement schemes for economic development and social justice, it does not contain specific provisions directly addressing the needs of unorganised labour. The Amendment primarily focuses on establishing democratic local governance structures and defining their functions.
Some scope exists under the safeguards for weaker sections, as municipalities were given powers related to urban poverty alleviation, slum improvement and upgradation, and safeguarding the interests of weaker sections. However, the effectiveness of these provisions in benefiting unorganised labour largely depends on how state governments and urban local bodies choose to exercise these powers and implement relevant schemes.
Housing and welfare initiatives
Addressing the shelter needs of urban poor, the government launched the Valmiki Ambedkar Awas Yojana (VAMBAY) in December 2001. This centrally sponsored scheme aimed to ameliorate conditions of urban slum dwellers living below the poverty line by facilitating construction and upgradation of dwelling units.
VAMBAY operated on a 50:50 cost-sharing basis between the Central and State governments. The scheme had the dual objective of providing adequate shelter and creating a healthy and enabling urban environment through the provision of community toilets. Since its inception, the programme released significant funds for constructing and upgrading dwelling units and toilet seats, directly benefiting thousands of urban poor families.
Sanitation improvements
The Nirmal Bharat Abhiyan, enacted in 2009 as an extension of the Total Sanitation Campaign, aimed to generate demand for sanitation linked to subsidy payments for toilet construction by families living below the poverty line. While primarily focused on rural areas, its urban sanitation components were later integrated into the comprehensive Swachh Bharat Mission launched in 2014.
These sanitation initiatives, though not exclusively designed for unorganised labour, significantly impacted their living conditions by improving access to basic sanitation facilities in urban slums and poor neighborhoods where many unorganised workers reside.
Role of NGOs and microfinance partnerships
Non-governmental organizations have played a crucial role in extending financial services to urban unorganised workers who traditionally lack access to banking and related services. NGOs have been instrumental in promoting Self-Help Groups (SHGs) and converting pilot microfinance programmes into large-scale operations.
Through microfinance initiatives, NGOs provide small loans ranging from $100 to $1,000 to help small urban businesses build inventories, expand operations, and stabilize family incomes. They work with street vendors, small shop owners, tailors, and other micro-entrepreneurs who constitute a significant portion of the urban unorganised workforce.
Microfinance institutions, often in partnership with NGOs, offer both group and individual loan options with personalized disbursement and collection services, making credit more accessible for those without traditional banking relationships. This approach helps individuals build credit histories, access essential capital, and contribute to local economic growth.
The implementation challenge
While these various measures represent significant policy interventions for urban unorganised labour, their effectiveness ultimately depends on proper implementation. The schemes face challenges including inadequate fund allocation, weak institutional capacity at the local level, and gaps in coordination between different government departments and agencies.
The success of programmes like SJSRY, housing schemes, and microfinance initiatives relies heavily on active participation of urban local bodies, effective community mobilization, and sustained political will. Without these elements, even well-designed schemes may fail to reach their intended beneficiaries or achieve their stated objectives.
Moving forward, there is a need for better integration of various schemes, strengthened monitoring mechanisms, enhanced capacity building of implementing agencies, and greater involvement of civil society organizations to ensure that urban unorganised workers genuinely benefit from these policy measures.
What do you think? How can the implementation of schemes for urban unorganised labour be strengthened to ensure they reach the most vulnerable workers? What role should community organizations and urban local bodies play in making these programmes more effective?
References
- https://mohua.gov.in/upload/uploadfiles/files/7(3).pdf
- https://en.wikipedia.org/wiki/Swarna_Jayanti_Shahari_Rozgar_Yojana
- https://www.pib.gov.in/newsite/PrintRelease.aspx?relid=80381
- https://en.wikipedia.org/wiki/Seventy-fourth_Amendment_of_the_Constitution_of_India
- https://byjus.com/free-ias-prep/municipalities-74-amendment-act-1992/
- https://www.gktoday.in/valmiki-ambedkar-awas-yojana-vambay_29/
- https://en.wikipedia.org/wiki/Swachh_Bharat_Mission
- https://www.downtoearth.org.in/blog/urban-poor-need-microfinance-for-livelihoods-6729
- https://www.dell.org/ideas/unlocking-urban-microfinance-in-india/
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