The challenge of universal coverage for the working poor in India

Working paper 2 of The Long road to Social Security

Tags: India , Civil Society Building
Additional tags: Working poor , Social security

The paper by K.P. Kannan deals with the challenge of universal coverage for the working poor in India. He draws attention to the fact that both basic social security and contingent social security are important from the point of view of the working poor. The fact that social security entitlements as part of one’s employment is confined only to less than 10 percent of India’s work force points to the enormity of the problem of coverage and the long road that lie ahead. While welcoming the two major national legislations (National Rural Employment Guarantee Act 2005 and Unorganised Workers Social Security Act 2008), he points out the limited coverage as well as the limited entitlements of these legislations. It is also significant to note that the Unorganised Workers Social Security Act 2008 is a collection of piece meal schemes without any logic leaving behind vast numbers of vulnerable workers to fend for themselves. The main message of the paper is to point out the need to create a social floor consisting of a national minimum social security, minimum conditions of work and a national minimum wage so that no one is allowed to fall below this floor.

Such a social floor is not only logical but also an imperative in the context of a fast growing developing economy within the framework of a democratic polity. This would then obviate need for a plethora of schemes that are in existence and sponsored by both the Central and State Government. These existing schemes have been put together in a separate document by Varinder Jain.

 

Background

This paper attempts to trace, albeit briefly, the evolution of social security systems for the workers in India.  Following Abram de Swan (1988), we may identify two generic concerns driving humanity’s quest for social security. These are deficiency and adversity; the former refers to inadequacy of means for a minimum standard of life while the latter would refer to contingencies such as sickness or accidents and eventualities such as old age and death. While conceptualising and elaborating the need for social security in developing countries, an attempt was made (Kannan 2007) to distinguish these two sets of social security in terms of Basic Social Security (BSS) and Contingent Social Security (CSS).

In a country like India where majority of workers who are called ‘informal’ have to struggle for a measure of livelihood security, it is needless to emphasize the importance of both the sets of social security.  Following the work of the National Commission for Enterprises in the Unorganised Sector (NCEUS), we now know that 92 percent of the workers are informal who do not have either employment security or social security (NCEUS 2007 and 2008).  Some state-assisted or sponsored social security for such workers did not exceed 6 per cent as on 2005.  Social security arising out of employment status and provided by employers is largely confined to 8 percent of the workforce who are identified as formal workers in the formal sector.

Elaborating the notions of deficiency and adversity, we may say that BSS is directly linked to the problem of deficiency of those who are not in a position to access minimum of resources to meet their economic and social requirements for a dignified life in a society.  The notion of CSS refers to social arrangements to take care of adversity i.e., contingencies of a wide ranging nature.  These could be hazardous situations arising out of human life and work, such as ill-health, and injuries and eventualities such as old age and death.  This broader understanding of social security emanated from the awareness that mere extension of formal sector social security measures like social insurance would not suffice to be social security for the poor in the informal sector; the need for targeted social assistance like the public distribution system as well as social insurance schemes for the unorganised or informal sector had to be specially designed to meet the needs of the unorganised sector (Guhan 1993).

Thus the current thinking of social security within the context of poverty and development in the developing countries reflect the growing understanding and acceptance of social security as a non-negotiable responsibility of the state.  In the Indian context, Guhan (1993) claims that social security in poor countries will have to be viewed as part of and fully integrated with antipoverty policies such as employment guarantee and food security, a view shared by many other scholars ( see, e.g. Dev 2001).

Conceptually, it is better to separate the notions of BSS and CSS. Core constituents of BSS can be identified in the realms of security related to food, health, housing and education. When it comes to CSS, as most of the literature related to workplace security measures indicate they constitute provisioning for several contingencies that arise to the individual in relation to the inability to engage productively and earn a living.  While historically ‘contingencies’ are often identified in relation to formal sector workers, increasing recognition of growing number of informal sector and un-organised sector workers has expanded the scope of CSS as well. The context of globalization characterized by quick mobility of capital has enhanced the vulnerability of the workers especially those of an informal kind.  Social assistance programmes for the aged (who completed productive working age), infirm, disabled, widows and other such groups who face adversities would come under special groups for the want of social security of this nature.