Centre plans PPP model for managing workers’ social security funds

New Delhi, May 7: The Centre,looking to provide social security cover to all workers, is considering a public-private partnership (PPP) model for managing the provident fund and insurance accounts of subscribers.
The provision is part of the latest draft of ‘labour code on social security 2018’, which provides universal social security to all workers.
At present, 50-60 million workers are covered under the insurance schemes of Employees’ State Insurance Corporation (ESIC) and provident and pension schemes of Employees’ Provident Fund Organisation (EPFO). The Centre plans to extend social security coverage to 500 million workers, under its code on social security, and plans to rope in an ‘intermediary agency’ to manage the corpus of funds.
“Given the vast scope and jurisdiction of Social Security, the code proposes a decentralised enforcement…At the same time, provision for intermediate agencies has been made, on the lines of PFRDA Act [Pension Fund Regulatory and Development Authority Act], in select fields such as fund management, point of presence, service delivery, benefit disbursement, record-keeping and facilitation for enabling PPP system in administering social security,” the draft code, circulated to stakeholders for inviting comments, said.
PFRDA, which administers the national pension system (NPS), has set up a trust to take care of the assets and funds of the scheme. Known as NPS Trust, it is responsible for monitoring and evaluation of all operational and service-level activities under the national pension system. The NPS trust is managed by the board of trustees appointed by PFRDA from time to time, comprising of professionals and experts drawn from diverse fields.
“The thought behind this provision is to expand the service delivery net to cater to the broad base of subscribers who are not just very large in numbers but are also very heterogeneous in their characteristics, including geographical spread, access to information, and ability to participate in this right based system. At the same time, this provision allows for engaging expertise for specialised yet non-core activities,” the draft code on social security said.
However, the proposed law said that the core activities of social security will continue to be a responsibility of the government. The government has put in adequate safeguards for exercising control over the PPP body that will handle the corpus of social security funds, as per the proposed code.