New Delhi: The Building and Other Construction Workers (BOCW) Cess is a crucial instrument of redistribution, a levy on construction costs intended to provide security for millions of workers. However, Rule 42 of the Draft Code on Social Security (Central) Rules, 2025, marks a significant shift in how this revenue is verified. The rules propose a transition from public audit to self-certification, a move critics argue could institutionalise the undervaluation of welfare obligations.Self-assessment and private certificationRule 42(2)(a) introduces a new mechanism for revenue collection. It mandates that the construction cess be paid in advance based on a “self-assessment duly certified by a chartered engineer”.This shifts the burden of verification. A chartered engineer is a private professional engaged by the contractor. By relying on private certification as the primary basis for payment, the State effectively steps back from independent verification of construction costs. Legal experts argue this creates a structural conflict of interest, where the assessment of liability is entrusted to a professional paid by the liable entity, potentially incentivising the under-reporting of costs to minimise the 1% welfare cess.The Rs 10 lakh scrutiny floorA significant provision regarding scrutiny is found in the proviso to Rule 42(4)(a). It states that the assessing officer shall conduct a scrutiny of the return “only where the amount of cess based on self-assessment exceeds rupees ten lakh”.In the economics of real estate, a cess of Rs 10 lakh corresponds to a project cost of approximately Rs 10 crore. By setting this floor, the State exempts projects costing less than Rs 10 crore from mandatory scrutiny. Critics argue this creates a “zone of impunity” for medium-scale projects and incentivises the fragmentation of large contracts into smaller units to stay below the threshold, thereby shielding a significant portion of construction activity from direct State oversight.The ‘deemed final’ clauseRule 42(4)(a) contains a further proviso: if the assessing officer fails to make an order of assessment within 180 days, the self-assessment “shall be deemed to be final”.Given the staffing constraints of labour departments overseeing thousands of sites, a 180-day deadline is tight. This “deemed finality” clause implies that bureaucratic delay results in the automatic acceptance of the contractor’s self-valuation. It essentially incentivises inaction, as the expiry of the clock legitimises the employer’s figures without forensic verification.Asymmetry in timelinesA disparity in processing times is evident in Rule 42(5)(b). It provides that if a project is stopped or the cost is reduced, the employer can seek a refund of the excess cess. The assessing officer must complete the scrutiny of this refund claim within 30 days.This stands in contrast to the timelines for worker claims or the 180-day window for assessment. The expedited “green channel” for corporate refunds contrasts with the often lengthy procedures workers face to access benefits, suggesting a prioritisation of capital liquidity over beneficiary support.Discretionary site inspectionsRule 42(4)(f) states that the assessing officer “may” authorise an enquiry at the work site to estimate construction costs. By using the permissive “may” instead of the mandatory “shall”, the rules render physical site inspections discretionary.Also read: How the Draft Social Security Rules Weaken Maternity RightsCoupled with the shift towards the “inspector-cum-facilitator” role, this suggests a move away from physical verification. Relying on documentary acceptance rather than site visits increases the risk that the paperwork may not reflect the physical scale of construction, further eroding the cess base.Writing off duesRule 52 governs the “writing off of irrecoverable dues”. It allows the corporation or board to write off unpaid cess, interest, and damages if the establishment has been closed for more than five years or if the employer’s whereabouts “cannot be ascertained”.Construction is often project-based, with entities dissolving after completion. Rule 52 provides a statutory exit for such transient entities. If a contractor delays payment and subsequently closes the specific project entity, the State is empowered to “wipe the slate clean”. This risks depleting the Social Security Fund while allowing profits extracted from unpaid cess to remain with the contractor.The registration gapThe logic of exclusion is compounded by Rule 46, which makes the employer responsible for registering the worker. If a contractor fails to register a worker – or update their details upon moving states – the link between the collected cess and the beneficiary is severed. Money may accumulate in a “Scheduled Bank” (Rule 6), but without registered beneficiaries, the fund cannot be utilised. This creates a welfare surplus built on exclusion, where the fund grows but remains inaccessible to the invisible workforce it was designed to protect.Also read: Does the Draft Wage Code’s ‘Standard Family’ Ignore Indian Reality?Finally, Rules 42 and 52 represent a shift towards “light-touch” regulation in the construction sector. By privatising the audit process, exempting medium-scale projects from mandatory scrutiny, and expediting corporate refunds, the draft code aims to simplify compliance. However, these efficiencies may come at the cost of the BOCW Fund’s integrity, raising fears that the financial architecture meant to support the construction worker is being eroded by design.