Country Paper ESI SCHEME OF INDIA AT A GLANCE Background Social Security is as old a concept as Society itself.

Slowly, the

changing conditions of life are affected by the changes in technologies, new experiences and life styles in post industrialization era which led to the creation of new demands of social legislations for providing foolproof social protection to citizens in general and industrial workers in particular. The continued and ever increasing deployment of a huge workforce has added to our responsibilities and obligations towards this vital segment of society. Demographic profile of India India’s population, as per the last decennial count of 2000 , is 1042.6 million. As per the world development report 2009 it reached to 1123 million in 2007. It is projected to be

around 1485 million in 2030 , thus

taking over the lead from China whose population is projected to be around 1462 million

by that year . POPULATION (IN MILLION)

1950

1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2040 2045

371 8 406 6 448 3 496 9 552 9 617 4 692 6 774 7 862 1 953 1

1 042 5 1 130 6 1 214 4 1 294 1 1 367 2 1 431 2 1 484 5

2050

763 1 593 852 1 613 800

Political System & Political Situation India is a Sovereign Socialist Secular Democratic Republic which endeavour and committed to create and constitute India in which justice – social, economic and political - prevails . It has a vigilant population and vibrant democracy . India has a federal structure of Government – Union of States - with strong centre . India has a parliamentary form of Government and have a

multi party system - a few national and rest are

regional

ones. Since last few years the national Government of the Country is being run by coalition of different parities .

Political situation of the country is

stable. 1|

Macro Economic Indicators India is a leading developing country whose gross national Income in 2007 was 1069.4 Billion dollars . Its per capita income was estimated at 950 dollar. The Indian economy entered the financial year 2008-09 with a buoyant growth rate. The average growth rate during the recent four years namely 2004-05 to 2007-08 has been at record level close to 9 per cent when compared to the average growth rate of 5.6 per cent recorded during the preceding four years. The Gross Domestic Product at factor cost is placed at Rs. 33.52 lakh crore during 2008-09 indicative of a growth of 7.1 per cent in 2008-09. The total food grains production in 2007-08 has been estimated at 230.7 million tonnes, 13 million tonnes higher than the 217.3 million tonnes in 2006-07 . Inflation measured in terms of the WPI (Wholesale Price Index) , were in the range of 3.8 – 6.9 per cent in 2003-04, 4.3 – 8.7 pr cent in 200405, 3.3 – 5.7 per cent in 2005-06, 3.7 – 6.7 per cent in 2006-07 and 3.1- 8.0 per cent during April-March 2007-08 . The current fiscal year started with inflation at close to 8 per cent and reached double digit in the first week of June. It rose to a high of 12.9 per cent in the first week of August and continued to be over 12 per cent in September. In October 2008 it came down to below 12 per cent and subsequently witnessed a sharp fall into single digit in the first week of November 2008. It has continued to decline since then except for a brief upswing in mid January 2009 and as of the week ending January 31, 2009 was 4.39 per cent. Cumulative increase in first 43 weeks of the current fiscal year at 1.5 per cent is significantly lower than the build up of 4.1 per cent in the first 43 weeks of 2007-08. Annual inflation rate stood at 4.39 per cent on January 31, 2009 compared to 9.1 per cent for primary articles, (-) 3.5 per cent in fuel group and 5.5 per cent in Manufactured products. Inflation for the three broad groups of commodities indicate hardening of prices for all the three major groups over the previous year, but some deceleration in inflation for fuel and power and manufactured product continued since first week of 2|

November, 2008. The continued rise in the inflation for primary articles has its implications for the food, non food and minerals index as well as the index for some essential commodities. Labour Market In India Reliable estimates of employment, unemployment and labour force are obtained from the Labour Force Survey carried out by the National Sample Survey Organisation on

quinquennial basis. The last

such survey was carried out in 2004-05 The Survey result show that the annual growth rate of employment , which had declined from 2.1 per cent during 1983- 1994 to 1.6 per cent during 1993 – 2000 , went up to 2.5 per cent during 1999-2005. While employment has grown faster than before with the demographic dynamics and higher labour force participation, rate of unemployment (as measured by usual principal status) also went up marginally from 2.8 per cent to 3.1 per cent during 1999-2000 to 2004-05. The latest and seventh quinquennial NSS survey, namely the 61st round conducted during July, 2004 – June 2005, reveals a faster increase in employment during 1999-2000 to 2004-05 as compared to 1993-94 to 19992000 . (Table ) EMPLOYMENT AND UNEMPLOYMENT (BY USUAL PRINCIPAL STATUS)

(Million)

1983 1

Labour Force Work Force No. Of unemployed Unemployment rate(%)

1993-94

2

277.34 269.36 7.98 2.88

3

1999-2000 4

343.56 334.54 9.02 2.62

377.88 367.37 10.51 2.78

2004-05 5

428.37 415.27 13.10 3.06

Labour force employment. The share of agriculture in total employment has come down from 61.67 per cent in 1993-94 to 58.54 per cent in 1999-2000, and 54.19 per cent in 2004-05 With the declining

further to

share of agriculture in GDP,

the scope of absorbing substantial additional labour force in agriculture appears limited. While construction and services particularly transport, storage and communication, contributed in maintaining employment growth

3|

in the economy, employment growth in manufacturing fell short of its potential. Only a small percentage (8 to 9) percent) of the total workforce of the country is employed in the organized sector. Organised sector employment as on March, 31 2004 was 26 million of which 68.82 per cent or 18.2

million was in public sector (T)

With public sector employment

declining by 2.06 per cent in 2004 over 2003, there was a corresponding decrease of 2.06 per cent in employment in the organised sector in 2004. The

decline in public sector employment, reflecting a conscious policy

decision, was compounded

by

a decline in organised private sector

employment .(T ). Introduction Post independent India saw the necessity of providing a strong support system for her underprivileged working class in the organized sector. It is in this perspective, before and after independence, a number of legislations have been enacted such as : (i)

Workmen’s compensation Act. 1923

(ii)

Maternity Benefit Act, 1961

(iii)

Employees’ Provident Funds and Miscellaneous Provisions Act, 1952

(iv)

Employees’ State Insurance Act, 1948

(v)

Payment of Gratuity Act, 1972 In 1948 a unique comprehensive health insurance scheme – the

Employees’ State Insurance Corporation (ESIC) - came into existence to ensure social security amongst the working class people in the organised sector. The scheme was launched on February 24, 1952 by the then Prime Minister of India, Pt. Jawaharlal Nehru, who also became the first insured person under the scheme .Since then in its long journey of fifty seven years it has emerged as a unique multidimensional health insurance scheme, based on the principles of ‘pooling of risks and resources’, catering to the needs of the covered workers in the hours of need by providing them full medical benefits. The Employees’ State Insurance Act which was passed by 4|

the Constituent Assembly in April 1948 was, in fact, the first social legislation adopted by the country after independence. This is one of a social security legislation which provides medical care and cash benefits to workers in the contingencies of sickness, maternity, disablement and death due to employment injury to workers. Administration This multi-dimensional social security programme is administered by an apex corporate body called the Employees’ State Insurance Corporation which includes 10 members from the employees, 10 members from the employers, 5 members from the Central Govt. and 23 members from the State Governments, and also 3 representatives of Parliament

& 2

representatives from medical profession. The Union Minister Of Labour is its Chairman, whereas, the Director General of ESIC appointed by the Central government acts as its Chief Executive Officer. The corporation functions on the principles of ‘Tripartite’ management. A Standing Committee, constituted from amongst the members of the corporation acts as the executive body.

The Medical Benefit Council, formed by the Central

Government, is a statutory body, advises the Corporation on matters related to the provision of medical care to the beneficiaries of the Scheme. At the state level there are Regional Board and local committees which helps the Corporation to implement the scheme in an effective way. The ESI Corporation at its meeting held on 08.07.2008 has decided to constitute Hospital Development Committee for all the ESI Hospitals in the country with representation of all the stake holders to review and monitor the functioning of hospitals and take on the spot decisions of improving the functioning of ESI Hospitals. The Committee has also been given requisite administrative

and

financial

powers

so

that

decisions

could

be

implemented. The Corporation has constituted various tripartite Committees viz. Budget & Accounts Sub-Committee, General Purposes Medical Care SubCommittee and the Sub-Committee of ESIC on Ayush to oversee and

5|

monitor various functions of the Corporation and to suggest improvements therein. The ESI Corporation has its Hqrs. office in Delhi. It has the network of 50 Regional, Sub Regional and Divisional Offices functioning in the different states of the country for implementing the scheme in the country. Applicability The ESI Act is applicable to non-seasonal power using manufacturing units employing 10 or more persons and non power using establishments where at least 20 or more persons are working. Consequently, employees of the above mentioned categories of units and establishments whose monthly wages do not exceed Rs.10,000/-per month are entitled to the benefits under the scheme. In the initial stage the ESI scheme was made available only at two industrial centres of the country viz Kanpur and Delhi. but in no time it could successfully spread its network through out the length and breadth of the country .These days the scheme stands implemented over 737 centres in 27 states and union territories. As things stands now the number of beneficiaries under the scheme has exceeded 46.8 million which itself is a proof of overwhelming faith of the workers in the scheme. Registration Of Factories:The employer in respect of a factory or establishment to which this Act applies for the first time and to which employer’s code no. is not yet allotted shall furnish to the appropriate Regional Office a declaration form within 15 days. After the receipt of the complete employers’ registration form the appropriate Regional office shall allot the employer’s code number and inform to the employer and the employer shall enter this code no. for all documents prepared or completed by him in connection with the Act.

6|

Registration Of Workers The employer in respect of the factory or establishment shall before taking any persons into employment in such factory or establishment after the appointed day required to submit the declaration form alongwith family particulars with in 10 days after obtaining the signature or thumb impression of the employee on the form including temporary certificate. The Form is required to be submitted in the appropriate/nearest branch office as already allotted by the Regional Office. On receipt of DF the appropriate Branch office shall promptly allot insurance number to each worker in respect of whom the DFs have been received. The temporary identification certificate with insurance number marked thereon shall be detached and returned to the employer.

The employer shall deliver the temporary

identity card to the employees to whom it relates after obtaining their signatures/thumb impression.

The insurance number allotted by the

appropriate office shall be entered by the employer of the return of contribution against the name of each employee. There is also provision to issue separate identity cards to the family provided the family is residing other than the working place of the IP. To avoid delay and to ensure that all insured persons receive their Identity Cards to enable them to avail the cash and medical benefit, the Identity Cards a decision has been taken to deliver the identity cards to insured persons directly by the Corporation instead of earlier

practice

of

delivery through employers. A census of covered/coverable units and employees is being carried out through independent agencies with a view to build data-base for expanding coverage under the scheme and to update and correct the data already available. An intensive awareness campaign has also various media including print, electronic,

been launched through

internet and outdoor with a

view to bring awareness about the scheme and the benefits available under the scheme.

7|

Finance The ESI Scheme is financed mainly by contributions from employers and employees. The rate of contribution by employer is 4.75% of the wages payable to employees. The employees’ share of contribution is at the rate of 1.75% of the wages payable to an employees. Employees drawing daily wages upto Rs. 70/- are, however, not required to contribute employee’s share. The State Government’s share of expenditure on the provision of Medical Care is to the extent of 1/8th i.e 12.5%. The employer shall pay contribution within 21 days from the termination of each wage period and submit the return of contribution alongwith paid copy of challan within 42 days from the termination of each contribution period . The amount of contribution received during last three years is as below:Year Amount (Rs. In million)

2005-06 19335.6

2006-07 24534.8

2007-08 32628.7

2008-09 36985.3

BENEFITS The Health Insurance Benefit offered under the scheme be categorized into two parts (A)

Medical Benefits

(B)

Cash Benefits A- MEDICAL BENEFITS The medical care services under ESI scheme in the states are provided

by the respective State Government except in Delhi and Noida where the medical care services are provided directly by ESI Corporation. Besides this ESI Corporation is also running one hospital in the state (which has been designated as Model hospital) and five Occupational Disease Centers. Besides insured persons and their families, ESI Scheme provides medical

8|

care to retired insured persons, disabled persons and their spouses subject to fulfillment of certain conditions. SCALE OF MEDICAL BENEFIT Medical care is provided as per the need of the patient irrespective of the amount of contribution. PROVISION OF MEDICAL CARE Medical care services to beneficiaries are provided by two ways:

Direct Provision through ESI schemes own network of dispensaries, diagnostic centers and hospitals.



Indirect Provision by contracting with private clinics (panel system), diagnostic centers and hospitals.

SYSTEM OF MEDICAL CARE SERVICES ESI Scheme is providing medical care under different systems depending upon the requirements of the region. The various system prevalent are:

Allopathy



Ayush which include Ayurveda, Sidha, Unani, Homeopathy and Yoga

LEVELS OF MEDICAL CARE SERVICES ESI Scheme provides all three different levels of care i.e. Primary care, Secondary care and Tertiary care (Super specialty care). Primary care is provided through dispensaries & panel clinics. Secondary care is provided through diagnostic centers and hospitals. Tertiary care is provided by entering into tie up arrangement with specialized private and government diagnostic facilities and hospitals.

9|

MEDICAL BENEFITS AVAILABLE ESI scheme is providing full medical care to its beneficiaries which includes preventive, promotive, curative and rehabilitative services. The various benefits available are:

Health education



Family welfare services



Immunization services



HIV and AIDS control services



Outpatients, inpatients, emergency medical services



Diagnostic laboratory and radiological services



Antenatal, natal and post natal services



Occupational health services



Super specialty services including specialized investigations



Physical and vocational rehabilitation



Ambulance services



Artificial aids and appliances such as spectacles, dentures, hearing aids, artificial limbs etc.



Drugs and dressings



ESIC is also implementing all the National Health programmes of Govt. of India through its hospitals and dispensaries.



In case of emergencies, the general public and other non ESI beneficiaries are also provided first aid and emergency treatment.

NEW INITIATIVES BY ESIC FOR IMPROVING AND AUGMENTING MEDICAL CARE SERVICES REMOVING DIFFICULTIES FACED IN FUNCTIONING DUE TO DUALITY OF CONTROL ESI Corporation has taken number of decisions for over-coming difficulties being faced in the delivery of medical care services through

10 |

ESI Hospitals and dispensaries due to duality of control. The various actions taken are : •

REVOLVING FUND SCHEME: - To cut down delays in provision of super specialty treatment, supply of drugs and dressings and repair & maintenance of equipments, ESIC has set up revolving fund with the consent of state government. Under this scheme the payment is made by ESIC against the valid sanction of the state government out of the money kept with the State Medical Commissioner office of ESI Corporation.

•

MODEL HOSPITAL SCHEME: ESI Corporation has taken a decision to set up one hospital in each State as Model Hospital. At present, ESIC has set up Model Hospital in 18 States. These hospitals are being up graded as per norms and standards laid down by ESI Corporation.

The

expenditure on Model Hospitals is fully borne by ESI Corporation. •

RUNNING OF ESI MEDICAL SCHEME DIRECTLY IN NEW GEOGRAPHICAL AREAS : Implementation of ESI Scheme in new areas directly by ESI Corporation in new geographical areas.

•

TAKING OVER OF ESI MEDICAL SCHEME IN THE STATES BY ESI CORPORATION:- ESI Corporation has written to the State Govts. to give their consent for handing over the ESI Scheme to ESI Corporation.

(b)

ZONAL SUPER SPECIALITY HOSITALS : Four Super specialty hospitals have been proposed to be set up in four zones i.e. south, East, West and North zone. In the first phase, super specialty hospital is proposed to be set up at Sanath Nagar, Hyderabad for South Zone and the foundation stone for the same has already been laid and construction work is to be started shortly.

(c)

CENTRAL RATE CONTRACT FOR ALLOPATHIC & AYURVEDIC DRUGS:- To ensure uniformity in the supply of good quality drugs, ESIC is formulating Rate Contract for drugs following transparent bidding procedure and strict eligibility criteria’s which is provided to the states for adoption. 11 |

(d)

NORMS AND STANDARDS:-

ESIC has formulated norms and

standards for staff and equipments for smooth functioning of hospitals and dispensaries. (e)

DECENTRALIZATION:- Powers have been delegated to the state medical commissioners for sanction of equipments, release of advance on account payments and repair & maintenance of equipments.

(f)

OCCUPATIONAL DISEASE CENTRE ESI Corporation has set up five occupational disease centre at Basaidarapur (New Delhi), Chennai (Tamil Nadu), Kolkata ( West Bengal), Mumbai ( Maharashtra) and Indore ( Madhya Pradesh) for prevention and early detection and diagnosis of occupational diseases amongst ESI beneficiaries. Special emphasis is being given for prevention of occupational diseases in insured persons working in hazardous industries.

(g)

PREVENTIVE HEALTH SERVICES To strengthen promotive and preventive health services under ESI medical scheme, ESI Corporation has allocated a separate budget of Rs.20/- per IP family unit per annum. This will help in prevention of diseases like diabetes, Hyper tension, HIV /AIDS and also promote healthy life styles amongst beneficiaries.

(h)

EXPENDITURE ON SUPER SPECIALTY TREATMENT To provide cashless and hassle free medical services, ESI Corporation has taken a decision for bearing the super specialty expenditure directly w.e.f. 01.08.2008. For this tie up arrangements have been made directly by ESIC with reputed and Govt. / private hospitals for specialty investigations and services.

(i)

IVF TREATMENT ESI Corporation is providing artificial re-production and IVF treatment facilities to insured persons.

12 |

(j) EXPANSION OF AYUSH FACILITIES ESI Corporation is expanding provision of AYUSH facilities in ESI Hospitals and dispensaries as per the local requirements of the area. For promoting the same, the total expenditure on provision of AYUSH facilities in the first five years is fully borne by ESI Corporation. (k) PATIENT SATISFACTION SURVEY ESI Corporation has under taken patient satisfaction survey in ESI Hospitals by independent agencies and is taking various actions based on the findings of the survey for improving the medical care facilities in ESI Hospitals. (l) GRADING AND ISO CERTIFICATION OF ESI HOSPITALS AND DISPENSARIES ESI Corporation is getting its hospitals and dispensaries graded by reputed organizations. Further action has been initiated for getting ISO certification in respect of hospitals and dispensaries. (m)

IT ENABLEMENT OF ESI INSTITUTIONS

To provide quick and hassle free medical care services, ESI Corporation has undertaken a plan for IT enablement of ESI Hospitals and dispensaries. (n)

STARTING OF MEDICAL EDUCATION INSITUTION As apart of initiative for over coming the shortage of medical manpower and improving the services in ESI Hospitals, ESI Corporation has under taken a project for starting medical colleges, nursing colleges, dental colleges and training school for other para medical staff in ESIC /ESI Hospitals. In the first phase, it is proposed to set up 11 Medical Colleges and 12 Post Graduate Medical Sciences and Research in the existing ESI Hospitals having 300 beds in the States.

13 |

(o) CHANGE IN THE PATTERN OF REIMBURSEMENT OF MEDCIAL CARE EXPENDITURE TO THE STATES ESI Corporation has taken a decision to reimburse the administrative expenditure incurred by the State Govt. on actual basis without ceiling subject to fulfillment of certain conditions. This will ensure State Govts. to post the medical and para medical staff in ESI Hospitals and dispensaries as per norms and standards of ESI Corporation and will help in providing proper medical care facilities to ESI beneficiaries. Further, the ceiling on medical care reimbursement to the States is being increased from Rs. 1000/- to Rs.1200/- w.e.f. 01.04.2009. (p) HOSPITAL DEVELOPMENT COMMITTEES Hospital Development Committees have been constituted in all ESI Hospitals and have been given adequate administrative and financial powers for taking decisions for improvement in medical care facilities. SOME OF THE BENEFITS AVAILED BY ESI BENEFICIARIES 

Specialized investigations such as CT scan. MRI scan, TMT & Echocardiography, invasive and non invasive cardiac tests etc.



Valve replacement, provision of Stents, Angioplasty, Coronary bypass surgery and other heart operations



Dialysis and kidney transplant



Temporary and Permanent Pacemakers



Cochlear implants



Anti cancer drugs



Surgical and orthopedic implants



Liver and Bone marrow transplant.



Joint replacements. 14 |

There is a huge infrastructure comprising of 144 hospitals, 1427 dispensaries, 307 Specialist Centres, 2135 IMP Clinics and arrangements with other institutions to provide medical care to beneficiaries. Total amount disbursed

during last three years towards Medical

Benefit is as under:(Rs.in million) Particular

2006-07

2007-08

2008-09

Medical Benefit

7797.8

9247.9

11232.2



Modernisation/upgradation/expansion of ESI Hospitals An additional amount of Rs.50/- per IP family unit per annum is given

to State Government over and above ceiling of Rs.1,000/- on fulfillment of certain criteria such as occupancy

of hospitals, grading of hospitals,

provision of staff etc. as per norms . Focus has now been thrown on preventive

and

promotive

health

occupational health. An Action Plan

care

including

strengthening

of

for the same has been drawn up and

is being implemented. Rs.20 per I.P. per annum are being proposed to State Governments outside the ceiling

for

this

purpose.

However,

the

expenditure beyond the prescribed ceiling is solely borne by the State Govt. concerned. The employers who are not coming under the purview of the ESI Act 1948 are absolved of their liabilities under the Workmen Compensation Act 1923 and Maternity Benefit Act 1961. OLD AGE MEDICAL CARE On payment of a nominal amount of Rs 120/-per annum per couple, medical care is offered to the superannuated and disabled insured persons and their spouses provided they were in continuous insurable employment for atleast five years before retirement.

15 |

B-

CASH BENEFITS:(i) Sickness Benefit:Sickness Benefit represents periodical payments made to an insured person during the period of certified sickness.

To qualify for this

benefit, contribution should have been paid for atleast 78 days in the relevant contribution period which is a period of six months i.e. from 1st April to 30th September & 1st October to 31st March and relevant benefit period is from 1st January to 30th June and 1st July to 31st December.. The maximum duration of sickness benefit is 91 days in two consecutive benefit periods. There is a waiting period of 2 days which is waived if the insured person is certified sick within 15 days of the last spell for which sickness benefit was last paid. The Sickness Benefit rate is roughly equivalent to 60% of the average daily wages of an insured person. Even after exhausting the sickness benefit payable up to 91 days if an insured person is still suffering from Tuberculosis/Leprosy, mental and malignant diseases or any other specified long-term disease, he is entitled to Extended Sickness Benefit (ESB) at a higher cash benefit rate of about 75% of average daily wage for a period of two years or more if he fulfills the contributory conditions. The rate of Enhanced Sickness Benefit (ESB) is 40% over & above the standard benefit rate i.e. at about 75% of the wages. For undergoing sterilization operations for family planning, IP will get upto 7 days in case of vasectomy and IW will get upto 14 days for tubectomy, the period is extendable in cases of post operative complication etc. Amount disbursed towards Sickness Benefit is as under:(Rs.in million) Particular Sickness Benefit

2006-07 774.8

2007-08 854.0

2008-09 1221.1

Amount disbursed towards Extended Sickness Benefit is as under:(Rs.in million) Particular Extended sickness Benefit

2006-07 106.5

2007-08 109.4

2008-09 130.5

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(i)

Maternity Benefit:-

Maternity Benefit implies periodical payment to an insured woman in case of confinement or mis-carriage or sickness arising out of pregnancy, confinement, pre-mature birth of child or mis-carriage. For entitlement to maternity benefit, the insured woman should have contributed for not less than seventy days in the immediately preceding two consecutive contribution periods with reference to the benefits period in which the confinement occurs or it is expected to occur. The daily rate of benefit is double the standard benefit rate which is almost equal to the full wages. Maternity Benefit is payable for a maximum period of 12 weeks in case of confinement, 6 weeks in case of mis-carriage and additional one month in case of sickness arising out of pregnancy, confinement, pre-mature birth of child or mis-carriage or medical termination of pregnancy. Maternity Benefit continues to be payable in the event of death of an insured woman during her confinement or during the period of 6 weeks immediately following her confinement leaving behind a child

for the whole of that

period and if the child also dies during the said period, until the death of the child. If confinement takes place at a place where medical facilities under the ESI Scheme are not available. The Corporation in its meeting held on 08.07.2008 has decided to enhance the amount from Rs. 1,000 to Rs. 2500 per confinement payable to insured women and wives of IPs (ii)

Disablement Benefit:-

In case of temporary disability arising out of employment injury, disablement benefit is admissible to an IP for the entire period so certified by the Insurance Medical Officer/Insurance Medical Practitioner for which the insured person does not work for wages. This benefit is not subject to any contributory conditions and is payable at a rate equivalent to about 75% of the average daily wage. The benefit is however, not payable if the incapacity does not exceed 3 days excluding the date of accident. Where the disablement due to an employment injury results in permanent, partial or total loss of earning capacity, the periodical cash 17 |

payments are made to the insured persons for life depending on the loss of earning capacity as may be certified by a duly constituted Medical Board. However commutation of periodical payment is permissible where the permanent disablement stands assessed as final and the daily rate of benefit does not exceed Rs. 5 per day, and where Benefit rate exceeds Rs. 5/- per day but commuted value does not exceed Rs. 30,000/- at the time of the commencement of final award of his permanent disability. Amount paid during last two years is as below:(Rs. In million)

(iii)

Particular

2006-07

2007-08

2008-09

PDB

Rs. 927.7

949.2

1278.2

TDB

Rs. 278.3

304.6

342.4

Dependants’ Benefit:-

Periodical payment is made to dependants of an insured person who dies as a result of employment injury.

The widow & widowed mother

receive monthly pension for life or until re-marriage. An amount equivalent to 3/5th of the disablement benefit rate is payable to the widow. Widowed mother and each child also share among themselves an amount equivalent to 2/5th of the disablement benefit. Children get benefit till 18 years of age. In case of infirmity, the benefit continues to be paid, till the infirmity lasts. Married daughters are not entitled to share dependants benefit. However, it is subject to the condition that the total Dependants benefit distributed does not exceed at any time the full rate of disablement Benefit.

In case it

exceeds the above ceiling the share of each of the dependants is proportionately reduced.

The periodical increases in the amount linked

with the cost of living index is sanctioned from time to time to compensate for loss of real value of Rupee. An amount of Rs. 387.2 million, Rs. 378.3 million and Rs.495.7 million was disbursed in 2006-07, 2007-08 & 2008-09 respectively (iv)

Funeral Expenses:-

Funeral expenses upto a maximum of Rs. 5000/- on the funeral of a deceased insured person are reimbursed. The amount is paid either to the 18 |

eldest surviving member of the family or in his absence to the person who actually incurs the expenditure for the funeral. The amount disbursed during three years is as under-

(v)

2006-07

2007-08

2008-09

Rs. 20.9 million

22.7 million

27.4 million

Rehabilitation Allowance:-

Rehabilitation Allowance is paid to the insured person for each day on which he remains admitted in an Artificial Limb Centre at double the Standard Benefit rate. vi- UNEMPLOYMENT ALLOWANCE:In order to provide social security to workers covered under the scheme during the periods of involuntary unemployment, Rajiv Gandhi Shramik Kalyan Yojana has been implemented w.e.f. 1.4.2005.

This provides

unemployment allowance in cash to insured persons who lose their employment due to closure of their factory/establishment, retrenchment or permanent disability due to non-employment injury as well as medical care for self & family for upto one year. Further, insured persons in receipt of unemployment allowance can also undergo training in Vocational Training Centres of the Government to upgrade their skills with a view to get Employment Fee during training including bus/rail fare will be borne by the ESI Corporation. vii-Scheme for permanently disabled insured persons: Permanently disabled persons working in factories and establishments drawing wages upto Rs.25,000 per month are coverable under the scheme w.e.f. 1-4-2008. In order to encourage employment of disabled persons, the employers’ share of contribution in respect of such disabled employees will be paid by the Central Government for initial three years.

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14-

SELF -CERTIFICATION : In order to improve compliance by

concentrating on defaulters, a

system of self-certification by employers has been introduced

w.e.f.

1.4.2008 under which employers employing below 40 employees will be required to give

only a self-certificate regarding compliance while those

employing 40

or more employees would submit self-certificate duly

certified by a

Chartered Accountant. Those employers who are

regular in compliance and also submit the self-certification will not be subjected to routine inspections and will be inspected only on random basis once in a period of 5 years. 15-

INSPECTION POLICY:A new inspection policy has been introduced which places emphasis

on inspection of newly covered units, defaulters and those not submitting self-certification with a view

to concentrate on improving compliance.

Three special drives in a year are being undertaken to increase the coverage. 16-

I.T. Roll out:The Corporation has decided to modernize its entire service delivery

system by adopting information technology. It has been decided to connect through a network all the offices, dispensaries and hospitals and to computerize them. A detailed study to provide ERP Solution for ESIC has been got conducted from a professional agency.

Based on this

comprehensive study, the IT Roll Out plan is planned to be implemented on BOOT Model. During the implementation of the IT Roll Out plan, every I.P. will be given two smart cards so that in case he migrates, the family does not face any problem in getting benefits of the Scheme. The I.P. will also be given a unique identification number so that in case he changes job, he does not face any difficulty in getting benefits. 17-

Public Grievance Cell:Corporation has set up a Public Grievance Cell for redressal of

grievances received from IPs/IWs/ their family members, Employers, Trade

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Unions, General Public, Through Telephone on toll free number, E-mail, PM Office/Cab. Sectt./VIPs/Ministry of Labour or through Complaint Box. On receipt of P.G. application/references, a copy is sent to the respective ROs/SROs/SSMC/SMC/Director/D(M)D/ESI Model Hospitals etc. within 3 days for taking necessary action and redressal of grievances under acknowledgement to the sender. After settlement of the grievance (S) the applicant is informed and reports sent to the Ministry of Labour & Employment etc. Thereafter it is closed. 18-

ESIC National Training Academy:The Standing Committee in its 169th meeting held on 2.6.05 resolved

to set up a National Training Academy (NTA) for ESIC Corporation at Mumbai in the beginning. The Academy was later on shifted to ESI Hospital, Rohini at Delhi due to administrative exigencies. The Academy is presently functioning under the charge of an Addl. Commissioner who is assisted by officers of other categories to discharge all functions relating to imparting of training to ESIC Officers & Staff from time to time. The ESIC NTA has since then acquired a stature of prominence in imparting training to officers & staff both medical & non-medical of the Corporation. Although there is dearth of competent faculties yet the NTA has been able to hire the services of few of the best faculties for each course of training it has so far conducted. The quality & contents of the training courses were of very high standard. Although, the Academy is in its formative stage of development yet every care has been taken to equip it with state of the art facilities available anywhere in such training centres of National level. The officers & staff of the academy are striving hard to upkeep its standard equal to, if not more than, those of other institutions of high repute and prominence in the field. The Academy has completed 13 courses successfully in which 216 officers have been trained during the year 2007-2008. In addition to this Zonal Training Institute organized 84 training programmes in which 1936 officials have been trained.

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PROVISION OF SOCIAL SECURITY FOR WORKERS IN THE UNORGANIZED SECTOR Out of the total work force of about 459 millions in India, 26 Million workers are in the organized sector, 18 Million in public sector and 8 million in private sector) and the rest are in the unorganized sector. The ESI Act covers workers in the organized sector only. At present about 12.07 Million workers (i.e. 46.4% of organized sector) are covered under the Employees’ State Insurance Act, which represents only about 2.63% of the total work force in the country. The remaining workers in the unorganized sector to which the ESI Act does not apply remain outside the social security umbrella due to the following reasons: (i)

Employees of Central and State Govts. who are provided social protection under the rules of the respective Governments;

(ii)

Workers of factories/ establishments using power and employing less than 10 persons and non-power using factories and establishments employing less than 20 persons;

(iii)

Workers of factories/ establishments situated in the non-implemented areas, where the ESI Scheme has not been implemented;

(iv)

Workers of seasonal factories/ establishments;

(v)

Workers drawing wages exceeding Rs. 10,000/- per month. The workers engaged in agriculture and allied activities, household

industry, building and construction, small factories/ establishments, home workers, domestic servants, artisans, self-employed persons such as fishermen, hawkers, auto-rickshaw drivers etc. all constitute the informal or unorganized sector. The main characteristics of workers in the unorganized sector are the acute incidence of under employment, the scattered nature of work places, high incidence of home-based work, low collective bargaining power and the absence of an employer-employee relationship.

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The main problems in extending formal social security schemes to the workers in the unorganized sector and those located in rural areas are as under: (i)

Seasonal and intermittent nature of work;

(ii)

Irregular patterns of earnings;

(iii)

Irregular patterns of employment;

(iv)

Heterogeneous character of the rural population;

(v)

Lack of infrastructural facilities particularly for the delivery of medical care;

(vi)

Relatively weak administrative machinery for disbursing benefits.

The workers employed in the organized sector and working in the smaller factories and establishments can be brought under the ESI Scheme by gradually lowering the threshold limit for coverage under the ESI Act. Likewise, the workers who are drawing wages above the wage limit of Rs. 10,000/- per month can be brought under the ambit of the ESI Scheme by removing the wage limit altogether. Factories and establishments located in non-implemented areas having sufficient concentration of workers are being brought under the ESI Act gradually as per the phased programme drawn in consultation with the State Governments. A majority of the workers in the unorganized sector comprise agricultural workers and cultivators located in the rural areas. The social security needs of workers in this sector are different from those in the organized sector. The workers in the agricultural sector mainly require wage and income support in times of drought, lean seasons and during periods of unemployment. In addition, they also require medical care. The level of 23 |

their earning is not fixed and there is no fixed employer-employee relationship with wage records etc., which makes recovery of contribution from such workers a challenge. As the ESI Scheme framed under the ESI Act, 1948 in its present shape provides a uniform package of benefits at a uniform rate of contribution, it cannot be extended to workers in the unorganized sector in its present form. The Govt. of India, Ministry of Labour & Employment has introduced a Scheme called “ Rashtriya Swasthya Bima Yojna” for providing social Security BPL (Below Poverty Line) workers in the unorganized sectors. Conclusion We may conclude that

what is needed for a sound , successful and

sustainable social security dispensation is collective responsibility based on participatory approach. In it, political parties, employers, trade unions, NGOs and above all the National Government are required to come together to take up the challenge of providing social security for all and particularly, for the ageing population who have contributed immensely during their younger days for the development of the respective countries in the World.

B.K. Sahu Additional Commissioner Employees’ State Insurance Corporation Ministry of Labour & Employment Government of India [email protected]

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