Facing heat from trade unions over the long delay in introducing the Social Security Bill for Unorganised Sector workers, the Ministry of Labour and Employment is finally ready with a Cabinet note on the same. The Bill aims to provide social security benefits to 93 per cent of the Indian workforce in the unorganised sector in line with the government’s commitment in its Common Minimum Programme.Though a similar Bill was mooted under the NDA regime, it never saw the light of day. A pilot scheme introduced by then Labour Minister Saheb Singh Varma in 2003, eventually went to seed after the UPA came to power in May 2004. Prime Minister Manmohan Singh had directed the Committee of Secretaries headed by the Cabinet Secretary to look at the issues involving implementation of such a law in November 2005. Now, the Cabinet has to take a call between two options put forth by the ministry for achieving the Bills’ objectives. The first option, as suggested by the CoS, is to introduce the schemes in a phased manner and launch a life insurance package at the initial stage. For a premium of Rs 200 per head, that would be paid by the Centre, a Rs 30,000 cover for natural death, a Rs 75,000 cover for accidental death or total disability and a Rs 37,500 cover for partial permanent disability would be provided. While workers Below the Poverty Line (BPL) won’t have to pay any premium, those above it would have to pay a nominal Rs 60, with the Centre and States sharing the burden for the rest of the premium. This option, however, leaves it to the Ministry of Health to look at the feasibility of providing universal health insurance as part of its Health Mission, though the PMO was keen on providing health care benefits to workers. The second option emerges from the recommendations of the National Commission for Enterprises in the Unorganised Sector, chaired by Rajya Sabha MP Arjun Sengupta. The NCEUS has recommended a comprehensive package including health and life insurance benefits along with an old age pension. The current allocation of Rs 2,052 crore towards the National Old Age Pension Scheme run by the Ministry of Social Justice and Empowerment could be factored for the pension benefits, as per the NCEUS blueprint. While the NCEUS proposals are to be financed with contributions from the Centre, states, workers (excluding BPL workers) and employers, the Centre would bear the cost of the pension benefits while the other costs can be shared by the Centre and states in the ratio of 75:25. APL workers would be required to pay a third of the insurance and pension premia. The NCEUS has proposed two alternatives for phasing the scheme’s implementation. Interestingly, Sengupta has communicated to the Minister of State for Labour and Employment (independent charge) Oscar Fernandes that the Bill must make national ‘minimum’ social security benefits ‘right-based’, as has been done under the National Rural Employment Guarantee Act. While the Act would require the Centre to formulate schemes and provide national minimum social security benefits that may include health, life and disability as well as old age benefits, the states would be free to formulate other benefits such as provident funds, funeral assistance, daughter’s marriage, et al.
