Of income security

<b>THE SUNDAY STORY</b> A person who reaches the age of 60 in India can now expect to live for more than another 15 years. But many cannot afford to take life easy in their old age.

“Among the most urgent concerns of older persons worldwide is income security,” notes a recently released report of the United Nations Population Fund. Their health, it pointed out, was another major concern.

“In the past, traditional social values and religious observances used to be quite supportive of the elderly in many developing countries,” said S. Irudaya Rajan, a demographer at the Centre for Development Studies in Thiruvananthapuram, in a book on social security. “Today, however, economic change, the disappearance of the joint family system and increased mobility are drastically eroding the support base of the elderly. At the same time, institutional arrangements catering to the needs of these people have been few and their coverage limited.”

A person who reaches the age of 60 in India can now expect to live for more than another 15 years. But many cannot afford to take life easy in their old age.

According to Dr. Rajan and E.T. Mathew, 56 per cent of men and 55 per cent of women continue to work beyond 60. (The proportion is higher in rural areas.) Even at 80 years and more, 20 per cent of men and 13 per cent of women are still working. This, they point out, is “due to lack of social safety nets and high levels of poverty.”

Only 8 per cent of India’s labour force of about 460 million is covered by any kind of social security provided by the employer, such as pensions, provident fund and gratuity, says K.P. Kannan. He was a member of the National Commission for Enterprises in the Unorganised Sector, which submitted its first report in May 2006.

There is no such safety net for those in the unorganised sector, which employs 84 per cent of the workforce and accounts for half the country’s GDP.

Besides, half of those employed even in the organised sector as gardeners, drivers, cleaners and the like do not enjoy such benefits.

The Commission recommended in 2006 that the Union government establish a National Social Security Scheme to provide a minimum level of health, old age and accident benefits. The State governments could, if they wished, provide additional coverage. But the government chose to create only a health insurance scheme covering those below the poverty line and some limited groups of workers

Kerala, which began its demographic transition earlier, had put in place social security schemes that covered 70 per cent of the workers in the unorganised sector, said Dr. Kannan. In the face of aging populations, there would probably be pressure in other States for similar measures.