CH.

1 INTRODUCTION

Development is a comprehensive economic, social, cultural and political process, which

aims at the constant improvement of the well-being of the entire population and of all
individuals on the basis of their active, free and meaningful participation in development
and in the fair distribution of benefits resulting there form. The human being is the central
subject of the development process and that development policy should therefore make
the human being the main participant and beneficiary of development.1

India has fully recognized the importance of the development policies of which Social
Security constitutes a significant part and hence it is accordingly taken up definite
strategies to realise the goal of ensuring economic security of every individual. Social
development was viewed as the primary goal with economic growth being only a means
to achieve it. The alleviation of poverty and raising the standards of living of poor people,
promoting education and employment and making the citizens self-sufficient through the
accelerating of development along with growth and social justice has been the major
plank of development strategies since India became independent. These objectives
received utmost priority in all the Five Year Plans. In fact the planning to achieve these
goals was started before India got its independence. In 1931 at Karachi, the Indian
National Congress passed a landmark resolution on Fundamental Rights and Economic
and Social change, the provisions of which have been regarded as the antecedents of the
Directive Principles in the Constitution.2

In general sense, social security refers to protection provided by the society to its
members against providential mishaps over which a person has no control. The
underlying philosophy of social security is that the State shall make itself responsible for
ensuring a minimum standard of material welfare to all its citizens on a basis wide
enough to cover all the main contingencies of life. In other sense, social security is
primarily an instrument of social and economic justice.

1
‘Declaration on the Right to Development,’ adopted by UN General Assembly Resolution, December
1986
2
http://shodhganga.inflibnet.ac.in/bitstream/10603/71638/9/09_chapter%202%20social%20security.pdf

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The concept of social security has evolved over a period of time. In the primitive
societies it was mankind’s struggle against insecurity to protect himself from the vagaries
of nature or finding the basic necessities of day today life. Later community living came
into existence which brought the family to provide adequate social measures for the
needy. With the rapid industrialisation, there was break up of family setup destructing the
traditional system resulting in need for institutionalised and state-cum society regulated
social security arrangement. Therefore, the concept of social security kept evolving and
widening as there is no commonly accepted definition of the term.3 Hence an attempt has
been made in this chapter to discuss the concept, definitions along with the background
of origin and development of social security.

The idea behind the concept of social security is that the state shall be responsible for
protecting its citizens against certain contingencies of life. There is no such definition of
social security which may be country to country according to the prevailing social
legislations, traditions ideals.

The basic principle of social security implies collective action by the community to help a
member against misfortunes and wants he cannot meet with his own resources. It is based
on business ethics “ideals of human dignity and social justice”.

Social security is the security that society furnishes through appropriate organizations
against certain risks to which its members are exposed. Broadly speaking the idea of
social security is that “The state shall make itself responsible for ensuring a minimum
standard of material welfare to all citizens on a basis wide enough to cover all
contingencies of life from womb to the tomb.

According to ILO “Social security is the protection which society provides for its
members through a series of public measures against the economic and social distress
resulting from sickness, maternity, employment injury, unemployment, invalidity, old age
and death. These measures are also of a great importance to a country which is on the

3
Government of India, Planning Commission Report of the Working Group on Social Security for the
Eleventh Five Year Plan, (2007- 2012), p.17.

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way of large scale industrialization as they improve employee’s morale by providing
sense of security to them again various industrial hazards.”

In fact social security is an attack on five “Giants” namely:

 Want,
 Disease,
 Ignorance,
 Squalor and
 Illness

Security against giant of “squalor” means security against all those evils which come
through the unplanned and unorganized growth of cities. The ultimate aim is one’s
economic and political protection. It is to protect the poor and to ensure that they have an
acceptable standard of living.4

4
http://mbaexamnotes.com/social-security.html

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CH.2 CONCEPT OF SOCIAL SECURITY

All the industrial countries of the world have developed measures to promote the
economic security and welfare of individual and his family. These measures have come
to be called as social security.5 Social security is dynamic concept and an indispensible
chapter of a national programme to strike at the root of poverty, unemployment and
diseases.

Social security may provide for the welfare of persons who become incapable of working
by reason of old age, sickness and invalidity and or unable to earn anything for their
livelihood.6 It is necessary to analyze various definition of social security in order to
appreciate the nature and concept of social security.

In general sense, social security refers to protection provided by the society to its
members against providential mishaps over which a person has no control. The
underlying philosophy of social security is that the State shall make itself responsible for
ensuring a minimum standard of material welfare to all its citizens on a basis wide
enough to cover all the main contingencies of life. In other sense, social security is
primarily an instrument of social and economic justice.7

5
Encyclopaedia Britanica, Vol.20, p.762.
6
Dr.S.C.Srivastava, Treatise on Social Security and Labour Law (Lucknow: Eastern Book Company) 1985
Edition
7
http://www.yourarticlelibrary.com/employee-management/social-security-concept-objective/

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CH.3 DEFINITIONS OF SOCIAL SECURITY

Sir William Beveridge

In 1942, Sir William Beveridge headed a committee that reviewed the national schemes
of social insurance in Great Britain during the post war period. In his report he defines
social security as follows:

“The security of an income to take place of the earnings when they are interrupted by
unemployment by sickness or accident to provide for retirement through age, to provide
against the loss of support by the death of another person and meet exceptional
expenditure, such as those connected with birth, death and marriage.”8

The Beveridge report argued that there were ‘five giants’ that were stalking the land and
that should be tackled. They are want, disease, ignorance, squalor and idleness.9

ILO

According to a definition given in the ILO publication’, “Social security is the security
that society furnishes through appropriate organisation against certain risks to which its
members are exposed. These risks are essentially contingencies of life which the
individual of small means cannot effectively provide by his own ability, or foresight
alone or even in private combination with his fellows”.

Jean Dreze and Dr.Amatya Sen

According to Jean Dreze and Dr.Amatya Sen, “The basic idea of Social Security is to use
social means to prevent deprivation and vulnerability to deprivation.”10 Robin Burgess
and Nicholas Stern Summarises the objective of Social Security as “The prevention by
social means of very low standards of living irrespective of whether these are the results
of chronic deprivation or temporary adversity.”

8
Dr. N. H. Gupta, Social Security for Labour in India 1986 Edition p.32.
9
Stephen Mckay & Karen Rowlingson, Social Security in Britain
10
Jean Dreze and Amartyasen, ‘Public Action For Social Security’

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The Encyclopaedia Britannica

The Encyclopaedia Britannica defines Social Security as ‘the main purpose of any plan
for Social Security in insurance against interruption and destruction of earning power and
for special expenditure arising at birth, marriage or death. This definition mainly focus as
on interruption in earning capacity and expenditure arising at birth, marriage or death11
but no mention about sickness, disablement maternity, unemployment etc., The kinds of
interruption in earning capacity have not been specified clearly. The interruption may be
of above contingencies.

Late President Mr. V.V. Giri

“Social security is the security that the state furnishes against the risks which an
individual of small means cannot stand the risks which an individual of small means
cannot stand up by himself or even in private combination with his fellows.”

Social Security is a fundamental task of a state and it is right of a citizen to enjoy this
security. It is quite clear from the above mentioned definitions that in a democratic and
welfare state, social security against law and order. It is social justice of the state. We
cannot think about any progress of society so long as certain measures are not available
to citizens.

11
Encyclopaedia Britanica, 1963, Vol.20, Chicago, London, Toranto, Geneva, Sydney, p.891.

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CH.4 FEATURES OF SOCIAL SECURITY

Social security provides financial helps in case of contingencies such as unemployment,

maternity, industrial disease, old age and death etc.

From the analysis of these above mentioned definitions one can identify the following
features of social security:

 Social security in some countries is applied to all governmental programmes and

in some countries it is applied only to Social Insurance programme.
 It covers wide variety of health and welfare schemes. The coverage of social
security is very wide meeting the different contingencies of an employee member.
 Social Security is a dynamic concept and its coverage changes with social,
economic and political system prevailing in a given country at a given time.
 A comprehensive scheme of social security consists of “Social Insurance and
social assistance".
 The modern social security scheme is the integration of its two important
elements of social insurance and social assistance and covering of all social risks.
 Social security must provide protection against all the ordinary risks of life and as
well as special risks of employment.
 It should bring under protection all member workers by hand and brain who live
solely by their mere earnings.
 All social security programme although differ from country to country but they
aims at providing some form of cash payments to individuals to individuals to
replace at least a part of the lost income that occurred due to any such
contingencies.
 It provides financial helps in case of contingencies such as unemployment,
maternity, work injury, industrial disease, old age, widowhood and orphan hood
etc.
 Under social security the members of a particular category are offered safeguards
and benefits such as medical and financial and to injured and financial help to

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widows, orphans and educational assistance in the form of scholarship and free
ships to the needy students.

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CH.5 CHARACTERISTICS OF SOCIAL SECURITY

The purpose of any social security measure is to provide individuals and families the
confidence that their standard of living will not be eroded by meeting with such socio-
economic contingencies in their life. The concept of social security varied from country
to country.12 This is understandable in a way because of the differential social and
economic development of societies in difference parts of the world. But the need for
economic protection is universal and hence social security measures have three major
characteristics even though they vary from country to country and from time to time
according to the need of the people and countries resources. They are as follows:

Social security measures are established by law.

They provide cash benefit to replace atleast a part of income in meeting
contingencies such as unemployment, maternity, employment injury, sickness, old
age etc.
These benefits are provided in three major ways such as social assistance, social
insurance and public services.

The most well-known techniques adopted by social security at present are no doubt social
assistance and social insurance which are discussed as follows:

Social Assistance

Social assistance schemes will grant benefits to people needing them. Social assistance is
a devise organised by the state by providing cash assistance and medical relief, to such
members of the society as they cannot get them from their own resources. The ILO
defines social assistance scheme as one that provides benefits to persons of small means
granted as of right in amounts sufficient to meet a minimum standard of need and
financed from taxation.13

The special characteristic of this measure is that it is financed wholly from the general
revenues of the state and the benefits are provided free of cost. But the beneficiary has to

12
Dr.V.G.Goswami, Labour and Industrial Law (Allahabad: Central Law Agency) 2011 Edition p.3.
13
Goswami, Supra note 16, at 11.

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satisfy means test which means certain prescribed conditions. The first risk to be covered
was that old age, but gradually non-contributory benefits were also introduced for
invalids, survivors and unemployed persons as well. Today social assistance programmes
cover programme like unemployment assistance, old age assistance, national assistance.
Thus, the social assistance underlines the idea that the care of people could not be left to
voluntary charity and should be placed on a compulsory and statutory basis. It represents,
“the unilateral obligation of the community towards its dependent groups”.14

Social Insurance

Social Insurance was first introduced in Germany by Bismark and since spread all over
the world.15 Social insurance is a plan insurance which aimed for protecting the wages of
those workers who do not have sufficient source to support their own self or their
families in case of loss of income due to meeting contingencies in their work life. Lord
William Beveridge has defined social insurance as “plan of insurance of giving in return
for contributions benefits upon subsistence level, as a right and without means test so that
individuals made build freely upon it.”

From the above analysis the following ingredients may be regarded as basic features of
scheme of social insurance:

o Certain risks which cannot be faced by the persons in their individual capacity are
faced collectively by a group of persons;
o For that purpose they have pooled together their resources;
o Benefits are provided to them in case of contingency;
o This makes them maintain their standard up to a subsistence level;
o Benefits are payable to them according to rates prevalent as a matter of right in
accordance with their salary or income; and
o The payment of contribution is obligatory since they are insured against the risk
compulsorily.

14
S.N.Mehrotra, Labour Problems in India
15
R.K.A.Subrahmanya, Strategies for Protective Social Security

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CH.6 APPROACHES OF SOCIAL SECURITY

“Social Security is a dynamic concept considered in all the advance countries of the
world as an indispensable chapter on all national programmes to strike at the root of
poverty, unemployment and disease, it was considered most essential for industrial
workers’.

The different comprehensive schemes on social security schemes on social security and
labour welfare would help in boosting the industrial morale and efficiency and is an
indispensable means to production and productivity.

A program of social security would lead the way to a new and better life for masses in
India. The different comprehensive schemes on social security and labour welfare would
keep industrial morale and efficiency and is an indispensable means to production and
productivity.

Broadly speaking the approaches of social security are three fold in nature:

(i) Compensation
(ii) Restoration
(iii) Prevention

I. Compensation means income security during spell of risks because the individual
and his family not be subjected to a double calamity involving both destitution
and loss of life, health and work. Under worker compensation, workers are
compensated in case of any permanent disability reducing permanently or
temporary earning capacity of aggrieved employee. It is compensating suffered
employees due to contingencies and unexpected mishaps by providing financial
support.
II. Restoration - It means giving individuals and their families the confidence that
their level of living and quality of life will not suffer as far as possible due to any

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 social and economic loss. “It aims at restoring the previous social and economic
status of the employee by providing financial and social help under different
provisions of social security Acts. Due to restoration of one’s previous status
financial position the self- confidence and self-esteem of the employee can be
maintained.”

Restoration means reemployment and providing self-confidence through cure of

sick/injured employees.

III. Prevention - Social Security is a basic instrument of social and economic justice
among members of the society.” It not only aims at compensation and restoration
of one’s financial and social status; it further aims prevention of mishaps,
industrial injury and occupational diseases.

Prevention aims at avoiding loss of productive capacity due to sickness i/injure or

Unemployment. Factory Act, Industrial safety Act and worker’s Compensation Act are
helpful in the preventions of different Industrial hazards leading to injury and
occupational diseases. Prevention is better than cure.”

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CH.7 OBJECTIVES OF SOCIAL SECURITY

Social security is of great importance to developing and underdeveloped countries which

aims at large scale rapid industrialization. It helps in improving morale of employees by
providing sense of security to them against various industrial hazards, occupational
diseases and any other types of unfair practices.16

“The State shall within the limits of its economic capacity and development make
effective provision for securing public assistance in case of unemployment, old age,
sickness, disablement makes the concept of social security of high importance to the
country.”

From its modest beginning in the 20th century, Social security in the present 21st century
has become a fact of life for millions of people throughout the world. In some countries it
includes only economic security while in other countries it covers wide different fields of
social security. It has now widely influenced by the economic and social policies of all
the developed and developing countries.

These are some of the important objectives of social security:

 Access to social security is a fundamental human right to which every individual

is entitled as a member of the society.
 Its main objective is to give individual that confidence through which they must
be sure that their level of living and quality of life will be adversely affected due
to any mishaps and contingencies.
 The aim of social security has been widened to include the complete quality of
working and living life in each aspect.
 Society security is wise investment which motivate the employees and boost their
morale.
 It is basic instrument of social and economic justice among members of the
society.

16
http://mbaexamnotes.com/social-security.html

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  Social security leads to adoption of the schemes of unemployment, insurance and
creation of new employment through a drive for rational planning and industrial
development.
 It further aims at the establishment of a scheme of old age and unemployment
pension.
 Social Security emphasis covering more different types of risks like sickness,
maturity and employment injuries.
 Under Social security cash benefits were to be given for employment injuries for
permanent partial incapacity.
 The main objective of social security is that a citizen who has contributed or is
likely to contribute to his country’s welfare should be given protection against
certain hazards of life.
 It emphasizes and ensures that the ideas of human dignity and social justice is
duly taken care.

The main objective of social security is that a citizen to his country’s welfare should be
given protection against certain hazards of life. According to the International Labour
Organization “ Social security is the protection which society provides for its members
through a series of public measures against the economic and social distress that
otherwise would be caused by the stoppage or substantial reduction of earning resulting
from sickness, maternity, unemployment, invalidity, old age and death.”

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CH.8 NEED FOR SOCIAL SECURITY

Modernisation and urbanisation have resulted in radical socio-economic changes and give
rise to new conflicts and tensions consequent upon the erosion of age old family and
fraternal security.17 The transition from agricultural economy to an industrial economy
brought in special accompanied problems like industrial accidents in serious dimensions.
Hence the joint family system, workers mutual aid societies, private savings etc. are
found to be out dated and inadequate to the tempo of modern life to provide relief in the
event of sickness, old age, maternity, unemployment, employment injury etc.

Human development insists that everyone should enjoy minimum level of security.
Workers also want to be free from economic threats which disrupt in their daily lives.
Hence, there must be a system in which the state bears the responsibility for providing
and ensuring a basic level of social security which is an essential ingredient in the
protection, development and full utilisation of human resources.

As social security is one of the fundamental needs of the modern human society to
provide for alternative sources of income to the workers at the time of contingencies
through a concerted effort of the most appropriate organisations, it was very much
realised by the state regarding the importance of protecting the victims from the
contingencies in work life. It is to meet this type of need the institution of social security
is developed.

17
M.Velusamy, Labour Welfare : Legislation and Social Security

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CH.9 LABOUR LAWS AND SOCIAL SECURITY

There are several legislative acts that are providing social security to workers in India.
These legislations provide social security to workers from each and every contingencies
like risks and mishaps which they are exposed to:

 “Employee’s provident fund and Miscellaneous provision 1952: It emphasis on

employee’s pension and family pension.
 Payment of gratuity Act 1972. It provides reward for providing a decent and long
service of an employee towards his organization.
 Workmen’s Compensation Act 1923. It aims to provide medical care. Periodical
payment during sickness and industrial accident/ occupational diseases to which a
worker is expected to while on the job.
 Employee’s State Insurance Act. The Act provides insurance to employee’s at a
highly economical premium and providing all types of insurance coverage for
meeting different contingencies during his life and giving a handsome amounts
after death to the family members.
 Maturity Benefit Act. It covers pregnancy, confinement their consequences and
medical care before and after delivery of the child.
 Group Insurance. Employees are given life insurance policies at very nominal
premium as compared to individual insurance.
 Payment of Wages Act 1936. Ensures timely right salary after permissible
deduction to the employees.
 The Minimum wages Act 1948 - It safeguard the workers to get minimum wages
from their respective employers at the prevailing price index.
 The Factories Act 1948: It is wide act which provide security to workers against
health, cleanliness, safety good working condition and employment of women and
children.

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Besides these important Acts social security is being provided to different segment of
employees by these sub acts like:

 Coal Mines Provident and Bonus scheme Act 1948

 The plantation labour Act 1951
 Assam Tea Plantation Provident Act 1955
 Personnel Injuries (Compensation Insurance) Act, 1963
 Seamen’s Provident Act 1968.

Beside these above mentioned legislations. There are certain other schemes introduced at
different levels for the purpose of providing social security measures with different
conditions.

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CH.10 CONCLUSION

The social security system got boost due to western influence and rapid industrialization.
Social reformers, labour welfare organizations and many progressive employers
persuaded the government to undertake social security measures as protection to workers
against different types of contingencies and mishaps.

In India due to high industrialization a new class of industrial workers is created with its
rural background with very little social and material sources and background, which
requires a great need and importance of systematized held through different measures of
labour welfare and social security Acts. Due to joint family especially in villages
unemployment, accidents, occupational diseases, old age and other contingencies does
not allow to suffer only individual members but their whole family suffers. Due to the
development of liberalism and individualism account of western influence the social
security has become indispensable in India.

Indian Govt. from time to time has been adding different Acts to safeguard the interest of
employees in those professions where there were more chances of exploitation and
victimization like mines, plantation coal and workers working in ships etc.

In conclusion it can be seen that Social security benefits have expanded rapidly after
independence. Social Security in India has been supported by laws which have enacted
from time to time during last four decades. In India Employee State Insurance and
Employee provident fund Schemes of the central government where state does not need
to contribute.

Unfortunately in India only workers engaged in Industry and organized sectors are
covered by these schemes. Unorganized sector, agricultural sectors have been ignored
they have to yet received benefits of these social measures.

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 Bibliography

 Shukla V.N. – “Constitution of India”, 12th edition – EBC,

Lucknow.

 Bakshi P.M., “The Constitution of India”, 13th edition –

Universal Law publishing.

 http://www.yourarticlelibrary.com/employee-
management/social-security-concept-objective-and-other-
details/35405

 http://shodhganga.inflibnet.ac.in/bitstream/10603/76677/9/0
9_chapter%202.pdf

 http://shodhganga.inflibnet.ac.in/bitstream/10603/71638/9/09
_chapter%202%20social%20security.pdf

 http://mbaexamnotes.com/social-security.html

 Dr.V.G.Goswami, Labour and Industrial Law (Allahabad:

Central Law Agency) 2017 Edition

 M.Velusamy, Labour Welfare : Legislation and Social

Security (Delhi: Dominant Publishers and Distributers
Private Ltd) 2014 Edition

 V.V. Giri, Labour Problems in Indian Industry (Bombay: Asia

Publishing House) 1972 Edition

 Deepak Bhatnagar, Labour Welfare and Social Security

Legislation in India (New Delhi: Deep & Deep Publications)
1984 Edition

 Meenakshi Gupta, Labour Welfare and Social Security in

Unorganized Sector (New Delhi: Deep & Deep Publications)
2007 Edition

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 Dr.S.C.Srivastava, Treatise on Social Security and Labour
Law (Lucknow: Eastern Book Company) 1985 Edition

 Dr. N. H. Gupta, Social Security for Labour in India (New

Delhi: Deep & Deep Publications) 1986 Edition

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