Friday, 8 April 2016

Social security in India


Generally the concept of social security system includes not just an insurance payment of premiums into government funds but also lump sum employer obligations. In India social security mainly includes pension, health insurance, gratuity etc. A great deal of the Indian population is in the unorganized sector and does have an opportunity to participate in the social security.

The employees provident fund organization which is under the ministry of labor and employment ensure pension and family pension in case of death during service. Only near about 35 million out of a labor force of 400 million has access to social security in the form of old age income protection in present. Out of these 35million 26 million employees are member of the employees provident fund organization. The employees provident fund system is contributed to by the employer and the employee. The employees’ pension system is contributed to by the employer and the government but not the employee.

There is a national health service in India but that does not include free medical care for the whole population of India. The employee’s state insurance act creates a fund to provide a medical care to the employees and their families those working in factories.

The workmen's compensation act requires the employer to pay compensation to employees or their families in case of employment related injuries resulting in death or disability. Compensation calculation depends on the situation of occupational disability. In case of death, 50% of the monthly wage multiplied by the relevant factor or an amount of INR 80000. In case of total permanent disablement 60% of the monthly wage multiplied by the relevant factor or an amount of 90000. The compensation act also includes permanent disablement and temporary disablement.

The maternity benefit act requires an employer to offer 12 week wages during maternity as well as paid leave in certain other connected contingencies. The maximum period for which any women shall be entitled to maternity benefit shall be 12 weeks, six weeks up to and including the day of her delivery and six weeks immediately following that day.

 In may 2015 Prime Minister Narendra Modi announced in Kolkata that near about five crore five lakh people have enrolled themselves in the three new national social security system in the week before the official launch. The schemes include two insurance products and one pension product, targeted mainly towards the unorganized sector and economically weaker population. A massive 80% of the country’s population is still outside the insurance coverage while the government estimated that merely 11% of the working population are under pension net.

The new life insurance plan the Pradhan Mantri Jeevan Jyoti Bima Yojana will offer INR 2 lakh cover at INR 330 premium every year. Bank account holders in the age of 18 to 50 years are eligible for this facility. Pradhan Mantri Suraksha Bima Yojana will offer a renewable one year accidental death or disability cover of INR 2 lakh at INR 12 premium every year. The insured will get INR 1 lakh in case of partial permanent disability. Atal Pension Yojana is for the people in the unorganised sector who are outside a formal pension.

                                                                                                                                      Pabitra Pandey
                                                                                                                        (PG MEDIA 2015-2017)


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