57 Social Security: Concept and Scope
This chapter takes up social security — the institutional protection of workers and citizens against the contingencies of life: sickness, maternity, old age, disability, unemployment, death, and dependant survival. Social security is the safety net that keeps individuals and families from destitution when work or income fails.
57.1 What is Social Security?
The ILO Convention C102 (Social Security — Minimum Standards, 1952) is the standard international definition. Social security is “the protection that society provides for its members through a series of public measures against the economic and social distress that otherwise would be caused by the stoppage or substantial reduction of earnings resulting from sickness, maternity, employment injury, unemployment, invalidity, old age and death; the provision of medical care; and the provision of subsidies for families with children.”
Three working features:
| Feature | What it means |
|---|---|
| Public protection | Provided by society, often through the state |
| Against contingencies | Predictable life events that disrupt income |
| Economic + social | Cash benefits + services (medical, family) |
57.2 ILO Branches of Social Security — C102 (1952)
ILO Convention 102 identifies nine branches of social security. A country must guarantee at least three branches to ratify the Convention.
| # | Branch | Contingency covered |
|---|---|---|
| 1 | Medical care | Curative and preventive medical services |
| 2 | Sickness benefit | Cash for incapacity due to illness |
| 3 | Unemployment benefit | Cash during involuntary unemployment |
| 4 | Old-age benefit | Pension or lump-sum on retirement |
| 5 | Employment injury benefit | Compensation for accident or occupational disease |
| 6 | Family benefit | Support for those with dependent children |
| 7 | Maternity benefit | Cash and medical for childbirth |
| 8 | Invalidity benefit | Pension for permanent disability |
| 9 | Survivors’ benefit | Support for dependants of a deceased breadwinner |
India has not ratified C102 but has progressively implemented eight of the nine branches (the gap being unemployment benefit, partially covered by the ESIC’s Rajiv Gandhi Shramik Kalyan Yojana and the Atal Bimit Vyakti Kalyan Yojana).
57.3 Concept of Social Security in India
The Indian conception draws on the Social Security (Minimum Standards) Convention, the Beveridge Report (1942) of the UK, and indigenous welfare traditions. The Indian Constitution provides the policy mandate through Articles 41, 42, 43, 47.
The 2002 National Commission on Labour defined social security in India as “the security that the society furnishes through appropriate organisation against certain risks to which its members are exposed.” The risks named: childhood, sickness, accident, unemployment, old age, death of breadwinner.
57.4 Scope of Social Security
| Element | What it covers |
|---|---|
| Population | Originally industrial workers; now extended to all citizens (universal coverage as the goal) |
| Contingencies | Nine ILO branches; also added: childcare, eldercare, disability |
| Forms of protection | Cash benefits, medical care, services |
| Time horizon | Income-replacement during contingency; survivor support after death |
| Funding sources | Contributions (workers, employers), state, taxes |
57.5 Approaches to Social Security
Three main approaches:
| Approach | Funding | Examples |
|---|---|---|
| Social insurance | Contributory; benefits proportional to contributions | EPF, ESI, EPS — chapter 58 |
| Social assistance | Non-contributory; from general taxation; means-tested or universal | Old-age pension under NSAP, MGNREGA, food security |
| Provident funds | Compulsory savings; benefits = own contributions + interest | EPF in India |
| Mutual funds / cooperatives | Voluntary group savings | Trade-union welfare funds |
The classical distinction is between social insurance (contributory, work-based) and social assistance (non-contributory, residence-based). Modern systems blend both.
57.6 Functions of Social Security
| Function | What it does |
|---|---|
| Income maintenance | Replaces lost earnings during contingencies |
| Poverty prevention | Keeps families above subsistence |
| Health protection | Medical care without catastrophic spending |
| Social cohesion | Reduces inequality and social tension |
| Workforce stability | Healthier, more secure workforce |
| Economic stabilisation | Counter-cyclical effect on aggregate demand |
57.7 Indian Social-Security Architecture — Pre-Code
Before the Code on Social Security, 2020, India operated six major social-security statutes for the formal sector:
| Statute | Year | Coverage |
|---|---|---|
| Employees’ Compensation Act | 1923 | Accident and disease compensation |
| Employees’ State Insurance Act | 1948 | Medical, sickness, maternity, employment injury, dependants’ |
| Employees’ Provident Funds Act | 1952 | Provident fund, pension, deposit-linked insurance |
| Maternity Benefit Act | 1961 | Paid leave and benefits for women workers |
| Payment of Gratuity Act | 1972 | Lump-sum on retirement / separation |
| Unorganised Workers’ Social Security Act | 2008 | Limited; framework for state schemes |
These covered only formal-sector workers. 80% of Indian workers in the informal sector were largely outside this architecture.
57.8 The Code on Social Security, 2020 — Universal Architecture
The Code consolidates 9 social-security laws (the 6 above plus the Building & Other Construction Workers Welfare Cess Act, the Cine-Workers Welfare Fund Act and the Iron / Manganese / Chrome Ore Mines Welfare Cess Act) into a single statute.
| Innovation | What it does |
|---|---|
| Universal coverage as goal | Extends social security to all workers — formal, informal, gig, platform |
| Gig and platform workers | Explicit recognition; aggregator-funded scheme |
| National database | eShram — registry of unorganised workers |
| Portable benefits | Cross-state portability of social-security benefits |
| Single registration | Aligned with other labour codes |
| Career account | Worker’s lifelong contribution and benefit history |
The Code is the largest social-security reform in India since independence. Its full operationalisation through state rules is still underway.
57.9 Social-Security Programmes Beyond Labour Statutes
India’s social-security architecture is much wider than labour-law statutes. Major programmes:
| Programme | Coverage |
|---|---|
| MGNREGA (2005) | Right to 100 days’ wage employment per rural household per year |
| National Social Assistance Programme (NSAP) | Pensions for elderly, widows, disabled below poverty line |
| Pradhan Mantri Jan Arogya Yojana (PM-JAY / Ayushman Bharat) | Health insurance for ~50 crore beneficiaries |
| Atal Pension Yojana | Pension for unorganised-sector workers |
| Pradhan Mantri Shram Yogi Maan-Dhan | Pension scheme for unorganised workers earning < ₹15,000/month |
| PM Garib Kalyan Anna Yojana | Free food grain to ~80 crore beneficiaries |
| eShram | National database of unorganised workers |
57.10 Indian Constitution and Social Security
| Article | Content |
|---|---|
| 41 | Right to work, education and public assistance in cases of unemployment, old age, sickness, disablement |
| 42 | Just and humane conditions of work and maternity relief |
| 43 | Living wage, decent standard of life, social and cultural opportunities |
| 47 | State to raise level of nutrition and standard of living |
57.11 Beveridge Report — A Foundational Text
The 1942 Beveridge Report (William Beveridge, UK) defined the modern conception of social security as protection against five giants — Want, Disease, Ignorance, Squalor, Idleness. The report inspired the post-war welfare state in the UK and shaped social-security thinking globally, including in India’s First Five-Year Plan.
57.12 Practice Questions
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| Programme | Focus | ||
|---|---|---|---|
| (i) | MGNREGA | (a) | Health insurance |
| (ii) | NSAP | (b) | 100 days' rural wage employment |
| (iii) | PM-JAY | (c) | Pensions for poor elderly, widows, disabled |
| (iv) | APY | (d) | Pension for unorganised workers |
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- ILO C102 (1952) — 9 branches of social security.
- India has implemented 8 (gap: unemployment benefit).
- Three approaches: social insurance, social assistance, provident funds.
- Six functions: income maintenance, poverty prevention, health protection, social cohesion, workforce stability, economic stabilisation.
- Six pre-Code statutes: Employees’ Compensation (1923), ESI (1948), EPF (1952), Maternity Benefit (1961), Gratuity (1972), Unorganised Workers (2008).
- Code on Social Security, 2020 consolidates 9 laws + gig and platform workers.
- Constitutional anchors: Articles 41, 42, 43, 47.
- Beveridge five giants: Want, Disease, Ignorance, Squalor, Idleness.
- Major non-statutory programmes: MGNREGA, NSAP, PM-JAY (Ayushman Bharat), APY, PM-SYM, eShram.