Social Security System in India

Protecting individuals from social and economic vulnerabilities through inclusive welfare and institutional safeguards.

Introduction

Social security in India refers to a network of policies, programs, and institutional mechanisms designed to protect individuals from economic and social vulnerabilities.

It ensures income stability, healthcare, and social welfare for both organized and unorganized workers. Anchored in the ideals of the Constitution, India’s social security matrix blends state welfare, community participation, and market-based insurance mechanisms to achieve inclusive growth and human dignity.

1. Organised and Unorganised Sectors

1.1 Organised Sector and Social Protection

The organized sector includes government departments, public sector undertakings, and registered private industries with structured employment and legal benefits. Employees receive statutory protection through EPF, ESI, Gratuity, and Pension benefits. Example: The EPFO digital platform (2024) streamlined online claims, benefiting over 70 million salaried workers.

1.2 Unorganised Sector – Challenges and Scope

Over 90% of India’s workforce is in the unorganised sector—agriculture, construction, domestic work, street vending, etc. These workers lack job security and welfare access. Example: During COVID-19 lockdowns, migrant workers faced unemployment and no health coverage, exposing systemic gaps.

1.3 Government Interventions for Unorganised Workers

The Unorganised Workers’ Social Security Act (2008) mandated schemes for health, maternity, old age, and disability. The e-Shram Portal (2021) registered 300 million workers for welfare portability. Example: In 2024, e-Shram was integrated with Ayushman Bharat for health coverage.

1.4 Gig and Platform Workers

Gig work through Swiggy, Ola, and Zomato represents informal labour without benefits. Example: The Code on Social Security, 2020 recognized gig workers, enabling insurance and pension benefits under government programs.

1.5 Regional and Gender Dimensions

Women in the unorganised sector face wage disparity and limited maternity benefits. Example: Kerala’s Kudumbashree Mission empowers women through micro-insurance and pensions. Tribal workers in Jharkhand and Odisha are being linked to PM Suraksha Bima Yojana through mobile enrollment.

2. Centrally Funded Assistance Programmes

2.1 Concept and Objectives

Centrally funded assistance programs provide safety nets for the elderly, disabled, widows, and marginalized. They align with Article 41’s directive for public assistance during old age or sickness.

2.2 National Social Assistance Programme (NSAP)

Launched in 1995, NSAP includes old age, widow, and disability pensions. Example: In 2023, Aadhaar-linked DBT improved transparency in NSAP disbursements.

2.3 Ayushman Bharat – Health as Social Security

AB-PMJAY offers ₹5 lakh health cover per family per year. Example: By 2024, it benefited over 30 crore people, improving access to tertiary care in rural India.

2.4 PM-Kisan and Rural Support

PM-Kisan Samman Nidhi provides ₹6,000 annual income support to small farmers via DBT. Example: It stabilized rural consumption during inflationary periods (2023–24).

2.5 Food and Nutritional Security

The NFSA (2013) legally guarantees subsidized grains to 80 crore citizens. Example: PM Garib Kalyan Anna Yojana (2020–24) ensured continued free ration distribution post-pandemic.

2.6 MGNREGA – Right to Work

MGNREGA guarantees 100 days of wage employment. Example: In drought-hit Maharashtra (2023), it supported 1.5 crore households with livelihood security.

2.7 Urban Social Assistance

PM SVANidhi offers microcredit to street vendors. Example: By 2024, over 60 lakh vendors accessed low-interest loans aiding urban recovery.

3. Public Initiatives & Legal Implementation

3.1 Legal Framework

The Code on Social Security (2020) consolidates nine laws to extend benefits to all employees, including gig workers, ensuring uniform labor protection.

3.2 Role of Judiciary

Courts interpret social security as part of Article 21 – Right to Life. Example: In Olga Tellis (1985), livelihood was recognized as essential to life and dignity.

3.3 Central and State Collaboration

Welfare delivery involves fiscal cooperation. Example: Under Ayushman Bharat, states co-finance premiums in 60:40 ratio (90:10 for NE states).

3.4 Digital Governance

Aadhaar–DBT saved ₹2.2 lakh crore (2024) by removing duplicates. Platforms like UMANG integrate pension, insurance, and health schemes.

3.5 Role of Civil Society and NGOs

SEWA provides health insurance and pensions for informal women workers. PMJDY partnered with NGOs for financial literacy campaigns.

3.6 Corporate Social Responsibility (CSR)

Infosys Foundation and Tata Trusts enhance social protection through CSR in healthcare and sanitation.

4. Improving the Social Security Matrix

Expanding inclusivity, ensuring fiscal sustainability, and leveraging technology are key to a resilient social security system.

4.1 Universalisation of Coverage

Expanding coverage beyond formal employment through graded contributions. Example: Social Security Code Rules (2021–25) cover part-time, gig, and seasonal workers.

4.2 Financial Inclusion and Digital Empowerment

The JAM trinity (Jan Dhan–Aadhaar–Mobile) ensures efficient welfare delivery, reaching 50 crore accounts by 2024.

4.3 Gender and Social Inclusion

Maternity Benefit (Amendment) Act, 2017 extended paid leave to 26 weeks. Sugamya Bharat ensures accessibility for persons with disabilities.

4.4 Old Age Security and Pensions

Atal Pension Yojana (APY) enrolled 6 crore workers by 2024. Senior Citizen Savings Scheme and PMVVY offer fixed returns and market protection.

4.5 Health and Social Insurance

Integration of Ayushman Bharat Digital Mission enables portable digital health records. ESI 2.0 (2024) covers establishments with 5+ employees.

4.6 Youth and Skill Development

PMKVY 4.0 trains youth for green and digital jobs, linking skill programs with EPFO accounts for employment-linked security.

4.7 Climate Resilience and Social Security

National Adaptation Fund (2023) introduced livelihood insurance for farmers. PM Fasal Bima Yojana integrates disaster risk insurance for quick settlements.

5. Social Security and Inclusive Development

5.1 Human Development and Welfare Linkages

Social security enhances human capital, reduces poverty, and improves equality. Example: India’s HDI 2024 improved through better access to health and pensions.

5.2 Sustainable Financing

Fiscal sustainability requires diversified funding. Example: Social Security Fund (2024) uses a digital platform cess to finance gig worker benefits.

5.3 Global Comparisons and Best Practices

India’s model aligns with Brazil’s Bolsa Família and Indonesia’s BPJS schemes. Example: The G20 Summit (2023) emphasized digital inclusion in welfare systems.

5.4 Future Reforms and Digital Integration

National Social Security Stack (2025) will unify all welfare databases under one digital identity for citizens.