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Social Security in India, Objectives, Acts and Schemes

Social Security in India

Social Security: Social security is a human right which response to the universal need for protection against certain life risks and social needs. It covers eventualities like Sickness, Maternity, Disability, Death, Unemployment, and Old age. Social Security in India covers treatment, rehabilitation or compensation. Lack of Social Security in India or in any other nation can lead to destitution, crime, child labour, etc.

Objectives of Social Security

Compensation, Restoration and Prevention are the three major objectives of Social Security.

  • Compensation implies security of income. It is based on this consideration that during the period of the contingency of risks, the individual and his/her family should not be subjected to a double calamity, thus by destitution and loss of health, limb, life or work.
  • Restoration commutates cure of one’s sickness, reemployment to restore him/her to earlier condition. In a sense, it is an extension of compensation.
  • Prevention measures are directed to avoid the loss of productive capacity due to sickness, unemployment or invalidity to earn.

Social Security Measures in India

In 1927, formulating a health insurance scheme received the attention of the Government of India. The Royal Commission on Labour also stressed the need for health insurance for industrial workers. The problem of health insurance was discussed in the Labour Ministers Conference in 1940, 1941and 1942 which resulted in the appointment of a committee presided over by Professor B.P. Adarkar in 1943.

BP Adarkar Committee (1943)

The committee was provided with the task of preparing details of the compulsory insurance for industrial workers. Adarkar Committee submitted the report in 1944 with recommendations based on compulsory contribution principles wherein contributions by the workers depended upon their earnings in slabs. ILO experts modified Adarkar’s report and finally, it was passed as the Employees’ State Insurance Act in 1948. Professor B. P. Adarkar developed the first Social Security scheme in India in 1944.

  • The govt enacted the Employees’ State Insurance Act, 1948 (ESI Act) to set up Employee State Insurance Corporation (ESIC).
  • Employees Provident Fund Act, 1952 was enacted to set up the Employees Provident Fund Organisation (EPFO).
  • Some earlier schemes like Workmen’s Compensation Act (1923) paved the way for workers & families to receive benefits in case of injuries.
  • The Maternity Benefit Act, 1961 provides for 12 weeks’ wages during maternity plus paid leaves.
  • The Payment of Gratuity Act, 1972 provides 15 days’ wages for each year of service to employees who have worked for 5 years or more in organizations with 10 worker strengths or more.

Social Security Schemes in India

India’s social security schemes cover the following types of social insurance:

  • Pension
  • Health Insurance and Medical Benefits
  • Disability Benefit
  • Maternity Benefit
  • Gratuity

There are two major social security plans in India, the Employees’ Provident Fund Organization (EPFO) and the Employees’ State Insurance Corporation (ESIC). The EPFO runs a pension scheme and an insurance scheme. All of these are supposed to grant EPFO members and their families benefits for old age, disability, and support in case the primary breadwinner dies. The ESIC covers low-earning employees providing them with basic healthcare and social security schemes.

Originally aimed at factory workers, the coverage was extended to include greater parts of the population, e.g. employees in hospitals or educational institutions. The ESI scheme has been implemented in all states excluding Manipur and Arunachal Pradesh.

Important Social Security Schemes

The Government of India has launched various important social security schemes in India. A list of Social Security Schemes in India is mentioned below in the table:

List of Social Security Schemes in India
Social Security Schemes Details
Atal Pension Yojana (APY) It is an old-age income security scheme for the working poor and the longevity risks among the workers in the unorganised sector. The Government had launched the scheme with effect from 1st June 2015. The scheme replaces the Swavalamban Yojana / NPS Lite scheme. It is administered by Pension Fund Regulatory and Development Authority (PFRDA).

Eligibility of APY

  • Minimum age 18 yrs – 40 yrs.
  • Individuals must have Bank account

Benefit of APY

  • Fixed Pension between Rs. 1000 – 5000 after age of 60 yrs.
  • Eligible of tax benefits similar to National Pension System.
  • Monthly pension is available to subscriber and to his spouse after death

The subscriber has to contribute on monthly basis between Rs. 42 and Rs. 210, if he joins at the age of 18 years. For the same fixed pension levels, the contribution would range between Rs. 291 and Rs. 1,454, if the subscriber joins at the age of 40 years.

Pradhan Mantri Jeevan Jyoti Bima Yojana (PMJJBY) It is a scheme with death coverage (Life Insurance). It is implemented by the Life Insurance Corporation (LIC). It provides life coverage to the poor and low-income section of the society.


  • Scheme can be availed by people aged between 18 to 50 years.
  • Must have a Bank Account


  • Insurance coverage of Rs 2 lakh.
  • Provide risk coverage of 1 year.
  • Premium to be paid Rs 436 /yrs (initially Rs 330)
Pradhan Mantri Suraksha Bima Yojana (PMSBY) It is an accident Insurance scheme under Ministry of Finance it covers Accidental death or disability coverage. It was launched in on 2015.


  • Persons between 18-70 years of age group are eligible for PMSBY.
  • The maximum age for the Pradhan Mantri Suraksha Bima Yojana is 70.
  • To use PMSBY, the applicant must be at least 18 years old.
  • Have a Bank Account.


  • It offers a life cover of Rs. 2 lakhs for one year for in case of accidental death or permanent disability.
  • A life cover of Rs. 1 lakh is provided to the beneficiary in case of partial disability.
  • Scheme can be availed by any individual aged between 18 years to 70 years.
  • Premium of Rs.20 to be paid. (Rs 12 initially)
Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) Yojana Under the scheme, the government has promised a direct payment of Rs. 6000 in three equal instalments of Rs. 2000 each every four months into the Aadhar bank accounts of eligible landholding Small and Marginal Farmers (SMFs) families.
PM Kisan Mandhan Yojana
  • Under the scheme, farmers between 18 and 40 years of age will get Rs 3,000 monthly pension after reaching 60.
  • All small and marginal farmers (with less than 2 hectares) who are currently between 18 to 40 years can apply for the scheme.
  • Life Insurance of India (LIC) has been appointed insurer for this scheme.
  • The farmers will have to make a monthly contribution of Rs 55-200, depending on the age of entry, in the pension fund till they reach the retirement date.
  • The enrolment for the voluntary scheme is being done through the Common Service Centres (CSCs) located across the country.
  • No fee is charged for registration under the scheme.
  • The Centre pays Rs 30 to CSC for every enrolment to ensure that the scheme witnesses maximum coverage.
Pradhan Mantri Laghu Vyapari Mandhan Yojana, 2019 The new scheme that offers pension coverage to the trading community was launched from Jharkhand.

  • Under the scheme, all shopkeepers, retail traders and self-employed persons are assured a minimum monthly pension of Rs. 3,000/- month after attaining the age of 60 years.
  • All small shopkeepers and self-employed persons as well as retail traders with GST turnover below Rs. 1.5 crore and age between 18-40 years, can enrol for this scheme.
  • The scheme would benefit more than 3 crore, small shopkeepers and traders.
  • The scheme is based on self-declaration as no documents are required except Aadhaar and a bank account.
  • Interested persons can enrol through CSCs across the country.
  • To be eligible, the applicants should not be covered under the National Pension Scheme, Employees’ State Insurance Scheme and the Employees’ Provident Fund or be an Income Tax assesses.
  • The Central Government will make a matching contribution (the same amount as the subscriber contribution) i.e. equal amount as a subsidy into the subscriber’s pension account every month.
  • Five crore traders are expected to join the scheme in the next three years.

Social Security in India UPSC EPFO

The Social Security in India UPSC EPFO is an important topic for the UPSC EPFO exam. As this topic is in relation to the essential functioning of the Employees Provident Fund Organisation. Its syllabus includes the important social security schemes and the legislations that have been framed by the Parliament of India as the Employees’ State Insurance Act, 1948 (ESI Act), Employees Provident Fund Act, 1952, Workmen’s Compensation Act (1923), Maternity Benefit Act, 1961, Payment of Gratuity Act, 1972.

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Social Security in India. FAQs

What is meant by social security in India?

Social security is a human right which responds to the universal need for protection against certain life risks and social needs

What do you mean by social security?

The protection that a society provides to individuals and households to ensure access to health care and to guarantee income security

Which is the first social security Act in India?

Workmen's Compensation Act of 1923 and the various State maternity benefit acts.

Who provides Social Security in India?

Ministry of Labour & Employment

What are the different types of Social Security in India?

Social security is divided by the Indian government into seven branches like health Insurance and Medical Benefit; old age/retirement benefits; unemployment insurance; life and disability insurance; maternity and childcare benefits; rural job guarantee; and food security.

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