Enabling Informal Workers for Inclusive Growth

The poor are actually the working poor. They are economically very active and are involved in wide range of production and services which are now classified as the informal economy. They put in hard labour, which generally averages 13-14 hours a day to sustain their families and in the process contribute significantly to the economy and society.

The Informal Sector workers constitute 93% of the workforce in India. More than 50% of this workforce is constituted by women. The informal workers are those who have no fixed employee-employer relationship and depend on their own labour for survival. They are poor, illiterate and vulnerable. They barely have any assets or working capital.

The informal sector also constitutes the largest pool of child labour. Because of the unregulated conditions, child labor ‘thrive’ in the informal sector leading to exploitation in numerous ways. The informal workers, too, become the source of supply of child labor sending or taking their children for work .

Nidan was established in July 1996 as a registered not-for-profit society. Nidan exclusively focuses on informal sector workers engaged in street vending, waste picking, construction, handicraft, domestic work, as well as dairy and agriculture.

Innovative Organizing of Informal Workers into Well-knit Legal Structures
As the informal workers are unorganized, the challenge is in collectivizing them, particularly the women workers, into well organized structures. The organizing has to be innovative and responsive to the demands of livelihood of the workers.  Nidan has been successful in organizing 4,00,000 workers into a variety of Membership Based Organizations (MBOs), such as self help groups, federation of self help groups, cooperatives, societies, trade unions, companies, etc. Organizing into legal entities opens up the world for these workers, and, depending on the level of leadership of these organizations, MBOs are able to secure and enhance the livelihood of the members.

Organizing also takes care of issues of harassment, non payment of wages and local level advocacy of the workers. Once trained and made aware of, these organized workers take care of exploitative forces and forge linkages with Government agencies at the local level.

Financial Services
The massive financial sector reforms in India that started in 1991 have not yet reached the informal workers, who need financial services like any other worker. Meager hard earned money is still kept by the poor in primitive ways, and access to loans is limited to high interest by money lenders. Nidan began by linking the workers to banks, and went on to set up thrift and credit cooperatives and even its own MFI called Nidan Micro–Finance Foundation.  It also began an insurance program in 1999, linking members with life and health insurance as well as pension services and government-sponsored social security schemes.

Seizing Opportunities in Urban market
Urban India is changing quickly, opening up many new opportunities, which can help informal workers be better integrated into the economic growth in the country.  Nidan has been involved in this effort on multiple fronts. 

Beginning with organizing waste pickers to stop harassment in year 2002, Nidan launched Chakachak Patna campaign to highlight the role of waste pickers in keeping the city clean. Nidan has also galvanized the process through Nidan Swachdhara Private Limited (NSPL) a company with waste pickers as shareholders and as Directors. Today, NSPL is handling contracts of waste management in Muzaffarpur, Patna, Bokaro, and Hissar, and has begun intervention in Jaipur and New Delhi. In addition, NSPL has set up compost plants in Bokaro, Hissar and Patna.

Another example is setting up National Association of Street Vendors of India (NASVI), which has brought about a national policy for urban street vendors in 2004, currently being implemented across India. Finally, Nidan has successfully advocated abolishing the exploitative tax collection system by contractors in municipal areas where street vendors work.

Skill Development
Nidan began working with home-based workers and artisans in year 2000 and later promoted Angana as an exclusive organization of home-based workers and artisans. Today Angana works in three districts of Bihar, has a showroom in upscale Boring Road in Patna, and participates in various exhibitions and trade fairs across the country. Angana has been able to provide secured livelihood to around a 1000 artisans across Bihar. But the process has involved intense skill development programs among the artisan, which also included design inputs on a continuous basis.

Encouraged by the result, Nidan has started a skill development program among the grown children of the informal workers.  They are being provided IT training, sales and marketing, hospitality and nursing for three months after which they are placed in entry level jobs in organized sector.
 
Mainstreaming of Children of Informal Sector Workers
In 2005, Nidan began community-based educational intervention with children aged 3-14 years to reduce instances child labor. Nidan monitors the educational progress of children in their communities.
- Every child in the program is tracked for educational progress to ensure that the child does not drop out of school.
- Assessment and liaison with government schools to admit newly identified out-of-school children.
- Children who have reached the age-appropriate level are enrolled where there is a government school within the 3km radius.
- Additional enrichment or remedial classes are conducted after school hours (for approximately 2 hours) especially to support and retain these children.    

Nidan has been able to mainstream 20,000 children in the three blocks of Murliganj, Kalyanpur and Sadar in Madhepura, Samastipur and Patna districts, respectively.

Policies and Schemes for Informal Workers
Informal workers need protection and social security under labour laws. Nidan helps them to be aware of, use and advocate for exisiting and new acts, policies and schemes. Examples include:
– Minimum Wages Act
– Construction Workers Regulation and Welfare Act
– National Policy for Street Vendors
– Management of Solid Waste Rules 2000
– Social Security Act

In summary, there is enormous potential for the India at the base of the pyramid, as there are no poor but working poor, in this growing economy. A large number of them exhibit entrepreneurial talent but lack market access. Nidan has been trying to do this by organizing, creating structures owned by them, helping them access credit, skill development, and market opportunities.  Nidan has also been enabling them to influence government policies in their favour. 

Arbind Singh

 

Editors Note
Arbind Singh, Executive Director, Nidan, India;
Social Entrepreneur of the Year, India, 2008

Nidan creates institutions and programmes aimed at economic and social development of India’s poorest and marginalized workers.