Social Security Provision for Unorganized Sector in India Debolina Dey* and Laishram Ladu Singh** International Institute for Population Sciences Abstract As a result of medical improvement and increased life expectancy people are living longer than ever in most of the countries. India is no exception in this phenomenon. With the longer life ageing also takes place simultaneously and old age brings lot of insecurity mostly financial insecurity in general and particularly for those belonging to BPL category. Realizing the increasing need to provide financial security to the destitute elderly The Government of India launched various scheme under The National Social Assistance Programme (NSAP) of the Ministry of Rural Development on 15th of August 1995. The present paper focus on the expenditure and allocation of fund for the NSAP with special focus on IGNOAPS with the help of Indistat.com. The paper finally comes out with obvious positive trend of increasing expenditure, significantly after the year 2010-11 for all over India and extreme concentration of funds among the few states. Key words: NSAP, IGNOAPS, Social Security, Unorganized Sector. “The State shall, within the limits of its economic capacity and development, make effective provision for securing the right to work, to education, and to public assistance in cases of unemployment, old age, sickness and disablement, and in other cases of undeserved want.” - Article 41 of the Indian Constitution *Debolina Dey, Doctoral Fellow, International Institute for Population Sciences, Govandi Station Road, Deonar, Mumabi- 400088, India, Email: [email protected] **Dr. Laishram Ladu Singh, Professor and Head, International Institute for Population Sciences, Govandi Station Road, Deonar, Mumabi- 400088, India, Email: [email protected] 1 | P a g e Introduction: In traditional Indian society, older people had a sense of honor and authority. The decision-making in the family were mostly assigned to them. They were valued for their experience and wisdom. On that tome mostly people of two or three or more generations would live together peacefully and happily under one roof. The family, commonly the joint family type, and social networks provided an appropriate environment in which the elderly spent their lives comfortably with all their respect. The traditional joint families as a social setup had risks distributed with households taking care of the social security needs of the elders. The presence of young and the old under the same roof enabled spreading of income risks and had for long negated the need for a centralized system of retirement planning. The emergence of modernization as well as industrialization, urbanization, occupational differentiation, education, and growth of individual philosophy has eroded the traditional values. These factors are responsible for breaking up of joint family system and respect for elders among members of younger generation. For a developing country like India, the rapid growth in the number of older population presents issues, barely perceived as yet, that must be addressed if social and economic development is to proceed effectively. Unlike in the western countries, where there is dominant negative effect of modernization and urbanization of family, the situation in the developing countries like India is in favour of continuing the family as a unit for performing various activities (Siva, 2000, 2002, 2004). Today India is home to one out of every ten senior citizens of the world. World has been experiencing demographic transition from high mortality and fertility to low mortality and fertility for a long period of time. It started as early as eighteenth century in Europe and Western World. Demographic transition represents population structure transition which reflects in age structure transition. Decline in mortality rise the longevity of the people in one side and in another side decline in fertility reduce the young population. So the process of population ageing is defined as the decline in the proportion of young population and rise in older population. The analysis of historical patterns of mortality and fertility decline in India indicates that the process of population aging intensified only in the 1990's. The older population of India, which was 56.7 million in 1991, is 72 million in 2001 and is expected to grow to 137 million by 2021. India’s rapid ageing is due to declining fertility, and longer life expectancy. The Total Fertility Rate (TFR), which was 2.76 during 2005-10, is projected to reach the replacement level by 2020. Indeed, variations in the TFR among different regions and groups in the country are high, with 2 | P a g e some states, such as Kerala and Tamil Nadu already experiencing TFR below the replacement level (Government of India, 2001). In India with majority of its population aged less than 30, the problems and issues of its grey population has not been given serious consideration and only a few studies on them have been attempted in our country. The main objectives of any social security (or social protection) system are consumption smoothing over an individual’s lifetime; insurance (particularly against longevity and inflation risks); income redistribution for society as a whole; and poverty relief. However, these have to be traded off against economic growth, labour market efficiency and labour market flexibility (Asher, 2009). At a global level, world is aging fast. The concern towards aging population has shaped up in building various social welfare measures for the older population pertaining to their insecurities especially the economic insecurity. However, in most of the developed western countries the social support towards elderly is associated with Medicare and network of homes, day care centers, nursing homes along with little monetary support in terms of pensions. For instance, social security programme of the United States includes old age assistance to the needy persons supplemented by medical insurance, social services, housing projects, institutional care, etc. The Canadian programme for the elderly constitute the Canadian Pension Plan in which Canadian labour force contributes in order to earn retirement pension at the age of sixty-five. In Britain, the Social Security Programmes provides financial help to the elderly, disabled, unemployed and widows. The pension in the country is based on needs for the aged with a contributory old age pension. On the other hand, developing nations increasingly face difficulties supporting their older population. In most developing countries, the elderly live at the bottom of the socio-economic strata. Older women, in particular, confront harsh conditions. Many people in the developing world hold informal jobs or work without wages in rural areas. These older persons enjoy no proper pension system have scarce retirement savings, if any. Most poor countries have no pension system, government only provide for the military and government officials. Given this background there exist several studies which explain about the needs and reforms of the Indian social security system. Asher (2003) is one who talk about the reforming of India’s social security system. He also talked about pension plans, provident fund schemes and retirement policies of India’s social security system in 2009. Asher and Bali (2010) also investigate India’s social security system, with primary focus on pensions or retirement income arrangements. Sanyal 3 | P a g e and Singh (2013) proposes a universal pension scheme that will bring relief to the working population in the unorganized sector and argues that it will increase the coverage of pension without disturbing the fiscal situation. Barrientos (2007) discusses new strategies to provide old- age security in low income countries. Several studies respect to this field shows that ageing is a very newly emerging research area which has been realized through demographic transition. The most of the population in India is now below 30 and most of the people are working in informal sector of the economy. Reform and increase coverage of social security system is the matter of concern in now days. Indian Scenario In India, the government’s concern for the old and the aging of the population as a priority began with India’s participation in the World Assembly Conference in Vienna in 1982, where India adopted the United Nations International Plan of Action on Aging. This plan focused on the government’s role in adopting programs aimed at providing care and protection to the old, while synchronizing these with the changing socio-economic conditions of the society. Following participation at the World Conference, the Government, by way of stressing its intentions for the welfare of the old, began to recognize the old as a social category that needs specialized attention (Shankardass, 2004). Following the global attention and in view of the increasing need for intervention in area of old age welfare, Ministry of Social Justice and Empowerment, Government of India adopted ‘National Policy on Older Persons’ in January, 1999. The policy provides broad guidelines to State Governments for taking action for welfare of older persons in a proactive manner by devising their own policies and plans of action. In India, the policy defines, ‘senior citizen’ as a person who is 60 years old or above. It strives to ensure well-being of senior citizens and improve quality of their lives through providing specific facilities, concessions, relief, services 10 etc. and helping them cope with problems associated with old age. As a result, providing for the care of older persons has become increasingly a major concern of the state and voluntary organizations resulting in various social security and support mechanisms towards the old as a helping hand of formal support. They include constitutional provisions, pension schemes, insurance schemes and various other privileges and benefits at the national and state levels. The Ministry of Social Justice and Empowerment, Government of India, is responsible for undertaking a special care of their welfare, care and protection by initiating various programs and projects.