45th SESSION OF
THE INDIAN LABOUR CONFERENCE
Item No. 1: Service Conditions, wages and social security for various categories of workers employed in different Central Government and State Government schemes (Angawadi, Mid-day meal, ASHA, Sarva-Shiksha Abhiyan and other schemes under various Ministries of Central Government.
There are a number of schemes that are being administered by the Central Government wherein services are taken from a variety of category of workers. These workers are neither recruited in the manner of a government servant nor are they provided wages and social security as is available to the government servant. In the absence of social security, such workers would be considered as unorganized workers. There could be a number of categories of workers falling in this group but the following ones constitute the largest among them:
(i) ASHA workers
(ii) Anganwadi workers: and
(iii) Those engaged for providing Mid-Day Meal under Sarv shuksha Abhiyan:
2. The Service conditions and wages of these workers are defined by the respective Departments. Necessary details have been collected from these Departments in the context of service conditions, wages and social security of these workers, which are as under:
Under the National Rural Health Mission (NRHM), every village in the country has been provided with a trained female community health activist as ASHA or Accredited Social Health Activist, selected from the village itself and accountable to it. The ASHAs have been trained to work as an interface between the community and the public health system. However, in the Ministry of Health & Family Welfare, which is implementing the NRHM, there is no initiative to recognize them as Government employees as they have been envisaged as voluntary activists under National Rural Health Mission.
Anganwadi Workers (AWW)
Integrated Child Development Services (ICDS) Scheme is a centrally sponsored scheme of the Government of India being implemented through states/UTs. The Scheme operates through a network of 7005 operational ICDS projects and 13.18 lakh Anganwadi Centres against 7076 sanctioned ICDS sanctioned ICDs projects and 13.70 Lakh sanctioned AWC/Mini AWCs. At present out of 13.72 Lakh sanctioned Anganwadi Workers (AWWs) and 12.54 lakhs Anganwadi Helpers (AWHs), 13.31 Lakh AWWs and 11.56 Lakhs AWHs are in position. These workers being “honorary Workers” are paid a monthly honorarium as decided by the Government from time to time. Government of India has enhanced the honoraria of these Workers w.e.f. 1.4.2011 by Rs. 1500/- above the last honorarium drawn by the AWWs and by Rs. 750/- of the last honorarium drawn by the Helpers of AWCs. In addition to the honoraria paid by the Government of India, many States/UTs are also giving monetary incentives to these workers out of their own resources for additional functions assigned under other schemes. Ministry of Women & Child Development has reported that in view of the very nature of the role of the AWWs and AWHs in the ICDS scheme, it is not feasible to declare them as Government employees or extend them the benefits as admissible to employees of the Government. Moreover, in a ruling of 7.12.2006 in Civil Appeal No. 4953-4957 of 1998 – State of Karnataka & others Vs. Ameerbi & Others, Hon‟ble Supreme Court has also held that AWWs do not hold any civil post and Minimum Wages Act is also not applicable to them.
Mid-Day Meal Workers
Under the Mid-day Meal scheme 27.48 lakhs, Cook-Cum-helpers (CCH) have been engaged for preparing and serving of the Mid-day Meal to the elementary class children studying in Government, Government-aided, Local Body Schools, National Child Labour Project Schools, Education Guarantee Scheme/Alternative & Innovative Education (AIE) Canters, Madrasas/Maqtabs recognised under Sarva Shiksha Abhiyan. They work for about 3-4 hours in the schools for preparing and serving the Mid-Day Meal (MDM) etc. Since Cook-cum-Helpers under Mid Days Meal Scheme are engaged for limited hours on part-time basis for preparing and serving the MDM, they are not treated as Government employees. However, they are paid minimum honorarium of Rs.1000/- per month for preparing and serving MDM in the Schools, on sharing basis with States/UTs on existing sharing pattern. Few States viz. Uttarakhand, Kerala, Mizoram, Karnataka, Punjab etc. are paying more than Rs1000/- per month for the honorarium to Cook-cum-Helpers by providing additional funds from the State Share. The noon-meal workers of State Government of Tamil Nadu are regular employee of the State Government.
3. The Central Government has legislated Unorganized Workers Social Security Act 2008 wherein Central Government has been given the responsibility of providing the following social security cover to the
a) Life and Disability Insurance
b) Health and Maternity Benefit
c) Old Age Pension
4. Pursuant to the mandate, the Central Government has formulated the following social security schemes:
(a) Aam Aadmi Bima Yojana for providing life and disability cover to certain categories of unorganized workers wherein the premium is paid by the Central and State Governments.
(b) Rashtriya Swasthya Bima Yojana for providing health insurance cover initially to BPL families and thereafter to domestic workers, street vendors, beedi workers, building and other construction workers and such NREGA workers as have worked for more than 15 days during the previous financial year. The premium is paid by the Central and respective State Governments.
(c) Swavlamban scheme for all such unorganized workers as contribute between Rs.1,000 and Rs.12,000 per annum under a pension scheme with a contribution of Rs.1,000 by the Central Government.
Except the Swavlamban scheme, the benefits of the other two schemes are not available to Anganwadi workers, ASHA workers, those engaged in Sarva Shiksha Abhiyan and Mid-Day Meal.
45 TH SESSION OF
THE INDIAN LABOUR CONFERENCE
Item No. 2: Social Security with special reference to Assured Pension with indexation for all workers including self – employed
Employees’ pension Scheme came into effect from 16-11-1995. It has been designed as a defined benefit Social Security Scheme Formulated following the actuarial principle for ensuring long term financial viability of this Scheme. The purpose of EPS. 1995 is to provide:
(a) Superannuation benefit, retirement pension, permanent/total disablement pension: and
(b) Widow or widower pension, Children pension or orphan pension.
2. Key object of the existing pension scheme is to provide financial and old age social security to its workforce particularly to those belonging to the lower income group and to provide income security to the family in case of death of a member/Pensioner of EPS, 1995.
3. Contribution of the Government and mandatory contribution of the employer is limited to the wage ceiling of Rs.6500/- per month. EPS, 1995 is funded by diverting 8.33% out of 12% of employer’s share of the wages. Central Government contributes @ 1.16% of the wages up to the wage ceiling of Rs.6500/-
4. Any defined benefit pension scheme would be subject to constant calibration of either benefit structure or the contribution structure or combination of both.
5. It may be mentioned that Employees’ Pension Scheme, 1995 is a funded scheme and increase in pensionary benefits can only be determined on the principles of aggregation of resources and risk sharing on actuarial basis. Under Para 32 of employees ‘Pension Scheme, 1995, there is a provision of annual valuation of Employees pension Scheme, 1995 by the Valuer appointed by the Central Government. Consequent upon this annual valuation, Government can change the scale of minimum payable pension or the rate of subscription or the scale of permissible benefits.
6. In the last few years, there has been a constant demand from pensioners for linking their pension with the inflation i.e. declaration of relief from time to time to negate the effect of inflation on pension. However, no such provision exists under the present Scheme for automatic declaration of relief.
7.The scheme does provide for grant of relief to the pensioners by the Central Government taking into account the performance of the Fund. From 1995 to 2000, the Annual Valuation revealed surplus which was used to grant relief to the pensioners. Thus, relief to the pensioners @ 4% w.e.f. 16-11-96, @ 5.5% w.e.f. 1-4-98, @ 4% w.e.f. 1-4-99 and @4% w.e.f. 1-4-2000 was allowed. However, on account of persistent actuarial deficit in the Fund, no relief could be declared by the Central Government after the year 2000.
8. An Expert Committee was constituted by the Government in 2009 to review the EPS, 1995, which inter-alia considered the issue of inflation indexation of pension. However, the actuarial cost of providing any such benefit is so huge that no workable solution could be found. This is so because the actuarial cost of providing relief of only 3% per year itself is Rs.98,653 crore. In such a situation, making a provision of inflation indexation for each 1% inflation would indicate an actuarial cost of around Rs.33,000 crore. If the average inflation is say 10%, this will entail an actuarial cost of more than Rs.3,00,000 crore which the Employees‟ Pension Fund, in its present form, will not be able to sustain.
9. Therefore, index linking of pension i.e. increase in pension by fully neutralizing inflation is not feasible through a funded scheme like EPS, 1995. In EPS, 1995, the contribution of employer and Government is at a fixed rate of 8.33% and 1.16% respectively. Therefore, the value of benefits cannot be left open ended linking pension with inflation.
10. The benefits that can be given under EPS, 1995 are to be governed by the contribution rate and earning on the fund. If benefits are increased without increasing the contribution or without increasing the earning by improving investment returns, the future generation shall be burdened by the deficits. The commensurate increase in benefits is possible only if requisite funding is received from any source.
11. In order to increase earning of the fund, definite steps have been taken by adopting latest pattern of investment approved by Ministry of Finance (2008 of Ministry of Finance) with the caveat that investment in equity will be zero percent. The proposal in this regard has been approved by CBT in its 201st meeting held on 25-02-2013. The notification of the pattern is under consideration in the Ministry of Labour & Employment. Considering the prevailing debt market condition, amendments have also been approved in the guidelines regulating investment. While amending the guidelines and recommending the change in pattern for investment, care has been taken not to put the capital invested on risks. The above changes in investment regulations are likely to yield an estimated incremental earning of 0.5%.
12. A proposal for ensuring a minimum monthly pension of Rs.1000/- per month to all member pensioners under EPS, 1995 is under active consideration of the Government and the Ministry of Labour & Employment has requested the Government to shoulder the burden of the funds required for this purpose since neither the employers nor the employees are willing to share this cost.
13. EPS, 1995 is a mandatory scheme for workers employed through the employer. As regard Social Security for self-employed, New Pension Scheme (NPS) may be an appropriate solution for such people.