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NAC working on new social security package

NAC working on new social security package
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First Published: Thu, Nov 17 2011. 12 51 AM IST

File photo
File photo
Updated: Thu, Nov 17 2011. 12 51 AM IST
New Delhi: Furthering the United Progressive Alliance (UPA) government’s objective of inclusive growth, the National Advisory Council (NAC) headed by Congress president Sonia Gandhi will discuss ways of bringing India’s unorganized workers under the social security net in its meeting on 29 November.
File photo
A new NAC working group on social security is working on draft recommendations that will seek to provide basic insurance coverage to this segment; the objective is to provide basic life and accident cover, health and maternity benefits and old age pension to an estimated 43 crore people.
“The NAC is examining whether the social security benefits are reaching the unorganized sectors or not,” said Mirai Chatterjee, NAC member and convener of the working group on social security. “We are going to give our final recommendations in the NAC meeting on 29 November.” According to government estimates, the informal sector constitutes almost 94% of India’s workforce and accounts for around 60% of India’s gross domestic product (GDP).
Parliament had passed the Unorganised Sector Workers’ Social Security Bill in 2008 aimed at covering the segment through various schemes run by the Central and state governments. But with a majority of the informal sector still outside the social security net, the NAC working group wants to make implementation of the law more effective.
“Through the Unorganised Sector Workers’ Social Security Bill the government acknowledged that the informal sector is also entitled to basic social security. But the implementation of the law is lacking”, Chatterjee said. “There are big gaps in the present system. We will suggest ways to plug these gaps”.
The total penetration of insurance (both life and non-life), measured by premium as a percentage of GDP, is only 5.2% in India, according to a report by Boston Consulting Group.
“Setting up of worker facilitation centres, wherein cooperative unions work with the unorganized sector for informing and enrolling the workers about schemes run by the government can be one of the steps”, Chatterjee said. “So far, only two states—Karnataka and Tamil Nadu—have implemented this.”
The working group will present its recommendations to NAC in the upcoming meeting, following which they will be put up on the website for comments. The Bill had recommended that every unorganized sector worker be registered with the government and be issued an identity card that can be portable.
The approach paper to the 12th Five-Year Plan also proposes the introduction of a state-funded universal health insurance scheme. Though the government runs a number of social security schemes, most of them are aimed at populations below the poverty line or at certain specific segments. One such scheme is the Rashtriya Swasthya Bima Yojana, which provides for in patient cover of Rs 30,000 per family per year.
Experts, however, are sceptical about the implementation of the programme. “This is ambitious simply because we do not know how to implement it,” said S.L. Rao, Bangalore-based sociologist and former director general of the National Council for Applied Economic Research (NCAER). “When we look at social security, we look at delivering services and money for taking care of health, education and insurance. To be honest, so far we have been incompetent in delivery of both services and money.”
remya.n@livemint.com
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First Published: Thu, Nov 17 2011. 12 51 AM IST