Central’s Social Security Scheme With Pension, Insurance Coverage for Informal Workers 

Central’s Social Security Scheme Cover 2018 With Pension, Insurance Coverage for Informal Indian Workers 

With an aim to offer a security measure to the workers belonging to the informal labor sector the central government is aiming at preparing the blue print under social security scheme. Under the initiative the Labor and employment Ministry has prepared the social security code draft which aims at offering with universal coverage which includes covering everyone who is excluded under ESIC and EPFO ambits.

Under the new recommendations made the PMO has directed the Labor Ministry to get started working on the process of implementation of the social security welfare before the General Elections.


Announcement Details

The new announcements were officially stated by the Prime Minister Office forwarding to the Labor Ministry for implementation before elections this coming year. As per the details, the ministry has been issued with recommendations to prepare the work out plan for the scheme. The net budget of Rs 2 lakhs has also been announced by the PMO for implementation of the scheme that will benefit 40 percent of the work force of the country belonging to the lower groups.

Key Features

  • The new scheme is a type of welfare scheme that will prove helpful in covering up over 40 percent of the social security funds for the beneficiaries registered under the scheme.
  • The scheme also states that the remaining of the 60 percent of the contribution is expected to be made directly by the beneficiaries in part of full.
  • The directives were officially made by the PMO to the labor Ministry at the time of High Level cabinet meeting with the officials from the labor ministry. The directives were also made by the PMO after approval from the FM (Finance Ministry).
  • As per the PMO the benefit of the scheme will first be made to the people belonging to the poor sections of the society. This has been done with an aim to lower the investment of the funds towards the scheme in the initial stage.
  • The government has stated that the funds will further be made available for benefiting other sections of the society. The scheme is expected to be fully functional for implementation by next 5 to 10 years time period nationwide.
  • Under the scheme it is expected that the Labor Ministry will try and design the proposed plan for the scheme to offer with numerous benefits in the form of old age benefits, retirement plans, unemployment scheme, disability and maternity benefits.
  • The scheme will also offer with health benefits to over 100 million people belonging to the poor sections of the society. The scheme is expected to go universal within a period of ten years from implementation.


  • The benefit of the scheme will be offered to the working class category of the country who are Indian nationals and belong to the poor section of the society.
  • Apart from this the benefit will first be offered to the poor people who are belonging to the unorganized worker section of the society and are not getting any employment benefit under any other such scheme run by the government.
  • It is expected that the scheme will offer benefit to over 500 million workers nationwide from economically weaker section of the society.

3 Phases

  • First Phase – The scheme will be implemented in three phases and in the first phase it will cover BPL workers and destitute who are unable to make contributions themselves and the over all cost will be covered by the government.
  • Second Phase – In the second phase the scheme will cover unorganized sector workers who will have to make some part of the contribution and remaining to be covered by the government.
  • Third Phase – The third phase of the scheme will include workers who are able to offer coverage for themselves individually or jointly by their employers.


For effective implementation of the scheme the government has announced to implement a set budget of Rs 18,500 crores in the first stage of implementation. Overall the scheme will offer coverage to over 500 million workers.

With the implementation of the above mentioned scheme the government aims at offering social security coverage to people who lack any such benefit by the government. The funds offered will be in the form of insurance coverage for managing medical, pension and PF benefits.

Before implementing the scheme the central government wants to assure that the funds for implementation of the scheme are already made available. The government has also stated that presently it needs to work out the extra amount of fund that will be required as top up amount for implementing the scheme depending on the resources available.


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