Effects of today’s outsourced governance!

By M.Y.Siddiqui

In modern outsourced governance, unlike earlier times, the boss has to do everything alone. This is reflection of the current outsourced environment with a shortages of dedicated employees that plagues all government offices, where the last regular recruitment took place many years ago, and the support staff are either retiring or to retire or have themselves become junior bosses. With about 30 lakh (3 million) vacancies in the central government and its public sector undertakings, contractual staff, who are theoretically on temporary employment, rule the roost. Disinterested and not very clued-in, contractual workforce are always out to make a quick buck or make hey while the sun shines. Their shenanigans are one of the main reasons for the poor image of the government employees. However, poor manpower policies where contractual employees are flourishing in all government wings, presents India now with contractual teachers, contractual doctors, contractual policemen, contractual clerks and the like, who are neither qualified nor trained for onerous duties they perform.

Added to the festering problem, most of the times, contractual employees are sourced from manpower suppliers, diminishing the little control the user department may have over such employees. Moreover with a vested interest in continuation of the status quo, contract workers agitate violently, if efforts are initiated to hire regular employees. The private sector is no better wherein a recent trend is growing to recruit highly educated youths at subsistence wages, who fecklessly run from one corporate employer to the other. As for the public, there is little to distinguish a contract worker from a regular employee. For example, police volunteers don the police uniform, ride police vehicles, and behave in the same empowering way, making them indistinguishable from regular policemen. It is learnt the culprit responsible for the tragic incident at Kolkata R.G.Kar Medical College & Hospital was one such outsourced police volunteer. Outsourced police constable is known as police volunteer. Such volunteers are recruited without any tests or background checks, are generally connected to some senior officials or have paid hefty bribes to get their jobs. So they cannot be shown the door easily.

The contract worker is not bound by conduct rules, has no promotion or pension to look forward to. Such worker fearlessly makes the best of the moneymaking and other opportunities that come his way. Regular employees are transferred periodically, but a contract worker can continue at the same position endlessly giving him much greater authority in the public eye. Senior officials patronize contract workers, as they are ready to work outside government rules. Resentment of contract workers started in a big way at the time the government offices struggled with computerization and required staff with computer knowledge. But once the bar on employing contract workers was removed, contract workers were hired in all kinds of scales, and soon contract employees proliferated in all government departments and public undertakings. This helped adept managers solve a short-term problem that ended up creating enduring problems.

The worst sufferer in this bureaucratic wrangling is the public. Instead of having trained competent persons to handle their problems, they have turned to people who have little experience, knowledge or desire to help the people. Contractual employees often let down the organization that hires them. In a shocking incident, a search and seizure action by the Income Tax Department failed spectacularly, because contractual employees leaked vital information. However, the lot of contract workers is not a very happy one, they have a lowly status; they are paid much less than regular staff for the same work, they have no housing or health benefits, there is no provision for their promotion or pension, and theoretically, they can be dismissed at will. The law provides for regularization of services of contract workers after a fixed period of continuous employment, but services of contractual workers are never regularized except after prolonged litigation. The unhappy saga of contract workers is a manifestation of the dire employment scenario in the country.

Sadly, a suitable job eludes most of India’s youth, according to the World Bank data. India’s employment rate ratio to the total working age population is 43 percent, much below the global rate of 55 percent and even below that of Bangladesh with 53 percent and Pakistan with 48 percent. In this perspective, India’s demographic dividend that envisages country’s working age population growing by 9.7 million per year during 2021-31 and 4.2 million per year during 2031-4, could have frightening consequences for our society. It is worrisome that till recently the government refused to even acknowledge that there was an unemployment problem. Relying on the Reserve Bank of India paper, Measuring Productivity at Industrial Level the India KLEMS (Capital Labour, Energy, Material Services) Data, the government recently claimed that 4.7 crore jobs had been created in the last few years, which was at complete variance with the findings of various independent organisations, like the UN  

International Labour Organization (ILO), Citigroup and Centre for Monitoring Indian Economy (CMIE).

After government-discontinued publication of data on employment in 2017-18 there have been recurring controversies about employment statistics. A member of PM’s Economic Advisory Council had claimed that 15 million jobs were created in 2017 compared to an average of 4 million jobs per year during the UPA government. This was contradicted by CMIE as absolutely false. According to CMIE, only 1.4 million jobs were created in 2017. This was palpably false, according to CMIE data. It said that unemployment in India was 53 million in December 2021. An additional 17 million were willing to work, if work was available. The union government has belatedly recognized existence of unemployment problem. Consequently, union budget 2024 rolled out five schemes to promote employment. All the schemes seem to have been hastily put together. These schemes are Band-Aid solution for treating a gaping wound of massive unemployment. As for up skilling, key requirement like linking up skilling, like aligning training programmes with job market needs, ensuring sustainable funding in place a mechanism for tracking progress seem to be missing. 

The underlying approach of promoting manufacturing through schemes like Make in India, and Production Linked Scheme (PLI), needs a re-evaluation, since increasing automation of manufacturing processes stymie commensurate employment generation, despite large investments very few jobs are created. Statistics bear that the main objective of Make in India was to increase the share of manufacturing in India’s GDP to 25 percent. As in 2024, manufacturing sector employs less than 60 million people and the share of manufacturing in GDP has remained stagnant at 17 percent. Leaving aside fresh employment, lay-offs have become the norms in many sectors. Indian IT companies laid off 72,000 employees in 2023, with the trend continuing in the current 2024 year. Reliance, India’s largest corporate, has laid off 42,000 employees. Globally also, the IT sector is on a de-hiring spree.

Solution to the deepening job crisis could be a top-down growth model. Rather boosting consumption in increasing the disposable income of lower and middle classes through a recalibration of direct and indirect taxation policies, would create more jobs. Till then, the plight of our beleaguered youth will continue in the pitiable conditions. Till such times jobs are created, the existing joblessness situation may result in catastrophe for the nation. So far, RSS Pariwar union government and the current NDA coalition union government economic policies have helped Indian wealth accumulation in few hands, and the people, in general, decay. During the last ten years, the union government has taxed the poor and enriched the select few rich corporates!

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