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SOCIAL SECURITY ACT IN INDIA

INTRODUCTION

The concept of Social Security is related to the high ideals of human dignity and social justice.
Social Security means the protection given by society to its members against contingencies'. People
with limited means of living can hardly provides effective security against the contingencies like
sickness, maternity, accidents, old age, death or other emergency expenses. This is basically due to
the fact that they don’t have the capacity or the foresight to carry out the plan of saving or
insurance. These contingencies impaired the ability of the workers to support themselves and their
dependents. It is designed to eliminate the 5 giants of Beveridge: want disease, ignorance, squalor
and idealness.

It is a security provided by the society to its members, particularly the weaker ones, so that they
can lead a normal and decent life even under adverse circumstances. It is a kind of wise investment
earning rich dividends in the long run. It consists of schemes by which all citizens of the country are
assured by the government a minimum standard of material welfare on a basics wide enough to
cover the contingencies of modern life. Germany was the first country who introduced the social
security schemes in 1883.

ARTICLE 41 OF INDIAN CONSTITUTION

As per the Concurrent list of Article 41 of Indian Constitution “The State shall, within the limits of
its economic capacity and development, make effective provision for securing the right to work, to
education and to public assistance in cases of unemployment, old age, sickness and disablement,
and in other cases of undeserved want.” This has laid the foundation of social security in India.
Further the government of India has realized “there can be no peace without social justice and no
justice without social security.”

AIMS OF SOCIAL SECURITY

 PREVENTION: Prevention is designed to avoid the loss of productivity capacity due to

sickness, unemployment etc and to render the available resources which are used by
avoidable diseases and idealness and thus increase the material intellectual and moral
wellbeing of the community. It trackless obsolescence as well as further loss of capability.

 RESTORATION: Restoration implies cure of the sick and employment and rehabilitation,
an extension to the earlier function of social security. It enables the workers to get back to
normalcy so as to lead a normal working and private life.

 COMPENSATION: Compensation goes to income security and is based upon the idea that
during spells of risks, the individual and his family should not be subjected to a double loss
involving destitution and physical total or partial disability, health, life or work.

PURPOSE

• To protect the rights of people and their entire family by giving benefit packages in the form
of financial security and health care.
• To guarantee least long-term sustenance to families.
• This concept is adopted from ILO and is established in every Law.
• This scheme offers cash payments to individuals to replace at least a part of lost income that
occurs due to mishaps.
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• During period of economic and physical distress the poor workers can at least survive on
compensatory payments offered by the government or the employer.
SOCIAL SECURITY TYPES

1. Social Insurance:
Social Insurance is the method to help individuals in times of contingencies through group
efforts. It is a cooperative scheme which aims at granting adequate benefits to the workers
on a compulsory basis, in times of unemployment, sickness and other emergencies, with a
view to ensure a minimum standards of living out of the fund created by the contribution of
the workers, employers and the government. The contribution is of nominal amount which
does not go beyond the workers paying capacity. Employers and the Government pay major
portion of the contribution. The purpose behind this scheme is to provide minimum standard
of living to the beneficiaries during partial or total loss of income.
Benefits:
• Provident fund and group Insurance on the basis of contribution record of the beneficiary.

2. Social Assistance:
Social Assistance is defined as a scheme to provide benefits conditional upon provided
needs at the time of claims, irrespective of previous contributions, but adjusted in each case
and paid out of the national exchequer. The benefits are offered to persons of small means
by government out of its general revenues. Workers and employers do not contribute
anything, only the government is the major contributor here.
Benefits:
• Old age pension granted as a matter of right, under certain condition satisfied.

SOCIAL SECURITY BENEFITS

The benefits provide under the social security are as follows:

• Medical care
• Sickness benefit in cash
• Old age pension or retirement benefits
• Maternity benefit
• Accident benefit
• Survivor’s benefit
• Squalor benefit
• Invalidity benefit

SOCIAL SECURITY ACTS IN INDIA

The following acts are covered under the social security:

 Workmen Compensation Act, 1923
 Employee State Insurance Act, 1948
 Employee Provident Fund and Miscellaneous Provision Act, 1952
 Maternity Benefit Act, 1961
 Employee Family Pension Scheme, 1971
 Payment of Gratuity Act, 1972
 Employee Deposit Linked Insurance Scheme, 1976
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SOCIAL SECURITY SCHEMES FOR UNORGANISED SECTOR IN INDIA

SOCIAL ASSISTANCE SCHEMES:

The centrally funded social security schemes cover the rural and urban areas under National
Social Assistance Programme (NSAP) are under a threefold system which can be tabulated as
follows as per data 2010:
SCHEME NAME AMOUNT BENEFICIARY
National Old Age Rs 75 per month Old people with little or no income support
Pension Scheme
(NOAPS)
National Family Benefit Rs 10,000 Families who lose their primary bread winner
Scheme (NFBS) consolidated (18-65 years of age)
National Maternity Rs 500 Women aged 19 and above up to 2 live births
Benefit Scheme (NMBS)

Other Central Government Schemes (as per data 2010)

SCHEME NAME AIMS FEATURES AMOUNT
Employment Generate further Cost sharing basis Rs 4000 crore approx.
Assurance Scheme employment between centre and
(EAS) opportunities state (4:3 ratio)
Swaran Jayanti Gram Improvement of Credit cum subsidy Rs 300 crore approx.
Swarozgar Yojana family income of and generation of self Around 10 lacs
(SJGSY) rural people employment covered.
Jawahar Gram Employment of rural Self employment Rs 5000 crore approx.
Samridhi Yojana infrastructure creation opportunities
(JGSY)
Scheme for Initiative from Thrift fund schemes Rs 60000 crore
Handloom Weavers ministry of textiles for and work shed cum approx
& Artisans handloom workers housing scheme

As per 2015 data following schemes are added under the Social Assistance Schemes:

SCHEME LAUNCH FEATURES

NAME
Atal Pension May 9, 2015 Social Sector Scheme pertaining to Pension Sector
Yojana
Pradhan Mantri May 9, 2015 Accidental Insurance with a premium of Rs. 12 per year.
Suraksha Bima
Yojana
Pradhan Mantri May 9, 2015 Life insurance of Rs. 2 lakh with a premium of Rs. 330
Jeevan Jyoti per year.
Bima Yojana
Pradhan Mantri August 28, National Mission for Financial Inclusion to ensure
Jan Dhan 2014 access to financial services, namely Banking Savings &
Yojana Deposit Accounts, Remittance, Credit, Insurance,
Pension in an affordable manner
Swavalamban September 26, Pension scheme to the workers in unorganized sector.
2010 Any citizen who is not part of any statutory pension
scheme of the Government and contributes between Rs.
1000 and Rs. 12000/- per annum, could join the scheme.
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The Central Government shall contribute Rs. 1000 per

annum to such subscribers.
SOCIAL INSURANCE SCHEMES
They are provided at the behest of the state using its insurance arm. The schemes are operated
through Life Insurance Corporation (LIC) and are extended workers in 24 approved occupation
groups who are in the age group of 18-60 years. The following schemes are provided under this
as per data 2010:

SCHEME NAME FEATURES

Social Security Group Workers are covered by paying a nominal premium of Rs 10 for every
Insurance Scheme 1000rupees insured. Half of this sum is paid from the Social Security
(SSGIS) fund. Around 50 lacs workers are covered in this scheme. Rs 25000 in
case of death or permanent disablement and Rs 12500 in case of partial
disablement.

Janashree Bima It applies to a group of at least 25 people and covers over 3 lacs people.
Yojana (JBY) The contribution pattern is the same as in Social Security Group
Insurance Scheme but the insurance cover has more slab under this
scheme:
 Rs 20000- for natural death
 Rs 50000- death in case of accident
 Rs 50000- permanent total disablement
 Rs 25000- partial disablement

Krishi Shramik It covers agricultural labourers but the upper age limit is 50 years, the
Samajik Surakhsa contribution of government from the social security fund is just the
Yojana (KSSSY) double of the workers contribution. Benefits include life cum accident
insurance, money back and superannuation. The amount insured is the
same as in Janashree Bima Yojana (JBY). Workers also get pension on
attaining the age of 60 years.

Individual Retirement It is an old age benefit. Individuals are encouraged to open up a

Account ( now known retirement account as soon as possible in their working life. They get a
as National Pension unique IRA number and workers can contribute to this account as
Scheme, NPS) frequently as they wish. It translates into pension benefits and annuities
at the time of retirement or withdrawal from work due to old age as the
case may be. The minimum contribution is Rs 500 per year and one
time contribution should be at least Rs 100.

Welfare Fund These are the various schemes launched for different sectors like Beedi
workers and other working mainly in hazardous industries. The system
works on the basics of 2% cess levied per 1000 units produced. The
finance so generated is utilised for the welfare of workers by providing
them amenities and medical benefits.
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PUBLIC INITATIVES

They include all the schemes that are initiated (other than the government) by the public bodies and
institutions. They may be NGO’s and Non- Profit Organizations’ who try and protect the interests
of the weaker section of the society by providing them social security. Some of the initiatives are as
follows:
1. SELF EMPLOYED WOMEN’S ASSOCIATION (SEWA):
The extremely popular scheme started in 1975 and provided insurance cover for as low a
premium as Rs 45 per annum. The member women are entitled to maternity benefit, health
benefit and financial benefits in case of husband’s death. It covers more than half a million
women and has helped provide them financial support.

2. MATHADI BOARD
This scheme is prevalent in Maharashtra and covers all workers indulging in hard manual
labors. The Mathadi are organized in unions and their representatives sit along with
employers and government representatives to form Mathadi Tripartite Board. These boards
help provide social security by setting up hospitals and dispensaries. Highly successful,
Mathadi Board charges only Rs 20 per month from each worker. Almost every year new
schemes are being introduced under them.

3. OTHER LOCAL AND REGIONAL BODIES like association for Health Welfare in the
Nilgris (ASHWANI), Voluntary Health Services (VHS), and Society for Promotion of Area
Resources Centre (SPARC) in Tamil Naidu, SAMAKHAYA in Andhra Pradesh work in
tandem with the workers. They try to collect money from the workers under different
schemes which are used up for their benefits in times of emergencies. The main aim is to
provide medical facilities to target groups. Some of them are working as nodal agencies
while others take up the initiatives themselves.