By K Raveendran
Observations made by the Supreme Court in a case relating to compensation to a deceased housewife should help Prime Minister Narendra Modi take his ‘pakoda economics’ to new, but highly productive frontiers.
Modi’s pakoda economics seeks to redefine the meaning of employment so as to include selling of pakodas and other wares by street vendors as good as employment, taking those engaged in the ‘profession’ out of the unemployed category. This was thought to help the Modi government’s track record in creating new jobs, which by all other considerations remained dismal.
The Supreme Court verdict that can help Modi’s case was delivered this week, wherein Justice NV Ramana said that the conception that house makers do not ‘work’ or that they do not add economic value to the household is a problematic idea that has persisted for many years and must be overcome.
A housemaker often prepares food for the entire family, manages the procurement of groceries and other household shopping needs, cleans and manages the house and its surroundings, undertakes decoration, repairs and maintenance work, looks after the needs of the children and any aged member of the household, manages budgets and so much more. In rural households, they often also assist in the sowing, harvesting and transplanting activities in the field, apart from tending cattle.
Official documents, including Census, not only categorise home makers as non-workers but most abhorrently equate them with beggars, prostitutes and prisoners, who are not considered to be engaged in economically productive work. The court points out that, based on 2001 Census, this has put 36 crore Indian women out of productive engagement, which is a travesty of truth. The undervaluation of women’s role in the economy is not a problem restricted to India, it has been practised throughout the world, although the outlook has been changing rapidly in the wake of the United Nations adopting a general recommendation in 1991 recommending the ‘measurement and quantification of the unremunerated domestic activities of women and their recognition in the gross national product’.
Indian courts have for long recognised the contribution made by the wife to the house as invaluable and beyond computation in terms of money. It has been held that the gratuitous services rendered by the wife with true love and affection to the children and her husband and managing the household affairs cannot be equated with the services rendered by others. Women on an average spent16.9 and 2.6 percent of their day on unpaid domestic services and unpaid care giving services for household members respectively, according to the ‘Time Use in India2019 Report’ of the National Statistics Office. While it is not possible to quantify any amount in lieu of the services rendered by the wife or mother to the family, the courts have underlined the need to make some pecuniary estimate of such work, particularly for the purpose of awarding compensation to accident victims.
This puts the focus on the notional earning by a housewife, for which various methodologies have been adopted. One of these is the opportunity cost, which evaluates a housewife’s wages by assessing what she would have earned had she not remained at home in terms of lost opportunity. The second is the partnership method, which assumes that a marriage is an equal economic partnership and in this method, the home maker’s salary is valued at half her husband’s salary. Yet another method is to evaluate much it would cost to replace the homemaker with paid workers, in what is known as the replacement method.
The Supreme Court had tried to work out the notional earning of a housewife in a 2001 case, arriving at a figure of Rs 3,000 per month, taking into consideration the multifarious services rendered by the housewives for managing the entire family. This was a big hike compared to an earlier estimate of Rs1,000 per month. Even by the most conservative estimate, this would mean that at current prices, the earning of an average housewife would be at least one lakh rupees annually.
This would be several times of what a humble pakoda seller can hope to earn. If a pakoda seller’s earnings qualify to be counted as gainful employment, a housewife is a much better fit for Modi’s definition of employment. So, in one stroke the Modi government would not only add about a third of the population in additional gainful employment, it would boost the GDP by several notches, denying Rahul Gandhi a stick that he has been consistently trying to beat the government with, although his success has often been called into question.
All that is required is a change in accounting norms: what better way can there be to solve India’s unemployment problem? (IPA Service)
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