Category Archives: Amendment 2015

The extent of ‘Confiscation’ around the world!

It is a pity that greedy middlemen who act as consultants to the ‘rich’ and the ‘powerful’ have now stepped up their campaign against the ESI and EPF schemes. They do not come forward to analyse how 27% of wages is recovered towards social security in Germany while it ranges upto 69 and 73% in Scandinavia.

It is even more pitiful that the politicians in power choose to pay heed to these middlemen to spoil the living conditions of the working population throughout the nation. The first of choice of these middlemen is to coin new terms. Contribution to Provident Fund is called by these middlemen as ‘confiscation’; removing the ESI and EPF benefits is projected as ‘increasing the take-home pay’; beneficiaries of the ESI and EPF schemes are called ‘hostages’. Fertile minds work in innumerable ways to curtail the benefits enjoyed by the common people!

The most charitable comment on the tendency of these middlemen could only be that these people are ‘least honest’ in their attempts. The way they tax their brains to coin new phrases to project their anti-people act as pro-people ones show that they enjoy their own sadistic behaviour. Their arguments will be replied to point-wise, later.

For now, we present only the opinions of the public across the world about the social security benefits provided by their governments and the extent of ‘confiscation’, as collected from Facebook:

(1). Patty Stewart Lucca : We visited Denmark, Sweden, and Norway. We can see your point!! We were very impressed how many benefits you had, free medical care. Free education, maternity and paternity leave, no homeless people in the streets! Taxes are high, but every one has the right to shelter and food. Some citizens can have more than others, but everyone has a decent standard of living. We said it would not work in the US, because we have a different work ethic here. (April 18, 2014).

(2). Bjarne Thyregod : Judy – because You dont know better. And Sorry to tell but a Danish teacher earn 60K a year, all people have 6 weeks paid freedom, state paid pension. Students dont pay their studies, schools re free, student get 1000 dollar pr month from the state, hospitals are free,, doctors free. We have som oeople that Want to get more and pay less – greed is a world spread disease.

(3). Tony Mavilia : My father came to the USA in 1932- he never completed high school because he had to go to work at 16 – was drafted into the army – The GI bIll enabled him to learn a skill. He bought a house ( worked 2 jobs to afford it – then Mom went to work, She had HS only ) They put me through private HS and I paid for College oin my own no loans ( partial scholarship – New York States Regents Scholarship and part time job while in school ) They lived a pretty secure life – vacationed several times a year – bought new cars when needed and had all the requisite mod-cons of a middle class life .At his death he owned his home – no mortgage payments. THAT was the American Dream. To live decently, own a home, see that your children got a decent education, have a secure job live nicely off your pension and savings and leave something to your kids when you passed away. Very few can afford that anymore- make no mistake the GOP laid the foundation for that beginning with the policies of Ronald Reagan and is working over time to make sure no American will live as was the former norm – the American Dream is dead and the GOP is responsible in great part. Now they work to remove Social Security and Medicare. Who do they represent – certainly not the American People.

(4). Mark Møller Hansen : I’m a Dane and there’s several things wrong with this:===== 1: The lady in the picture is an ACTRESS PLAYING a teacher, not a real teacher
. ===== 2: The average salary with a minimum of 4 years experience is 45k rather than 61k (no benefits and a higher pressure and negative energy than any other profession at the moment) =====3: The minimum taxes are around 43% (45% if you’re working)
 =====4: Students can barely survive on the support they get and there are no jobs to get since virtually all part-time jobs are occupied by wellfare-receivers (companies don’t have to pay for them, meaning a free work-force)
 =====5: The average family’s struggling to keep afloat with prices and taxes going through the roof while millionaires and politicians are laughing all the way to the bank.

No, Denmark isn’t crap and we TRY to take care of each other, but bureaucracy’s screwing us over as badly as any other country.

(5). Jackie Has IC : America sucks for our generation. It was great for my parents generation who could graduate high school, get married, get a good job that would invest in the worker and train that worker so yes you could work your way up, build a new home, mother stayed home, raised two kids, had family vacations, fathers job lasted 30 years, possibly came with a pension, plus health insurance. As his own children have had none of that at all, only low wage jobs, part time, zero growth or job training within any company, forced to go to college for a promise of a good job forced into to a lifetime of student loan debt, unable to live on one parent income, forcing the mother to work outside of the home, forcing the added cost of daycare which our parents didn’t have. It goes on and on. No we don’t have the American Dream, it’s a joke. People go homeless and die even if they have a job in this country. And our country allows it to happen and looks the other way, they don’t care one bit.

(6). Paul Chataway : The point is not to be anti USA or anti any other country, I have heard the above stats m any times and I wonder why other countries don’t follow countries like Norway, Sweden, Switzerland and Dans, and look seriously at adopting similar principles…Today everyone is under more stress just to get through life should we not be looking at trying to enjoy our lives as we move forward and minimise our stresses? I am writing this from China where I choose to live but I am from Australia where some of the above principles apply and at times I really SAD to see our social institutions being attacked as if “Social Entitlements ” are evil. But Corporate Welfare is just because it might create jobs. That wealth distribution & caring about the less fortunate is a corporate concept. Don’t allow the Greedy rich & powerful dictate social policy, there is advantage ONLY FOR S FEW , to keep people in financial insecurity, it provides cheap Labour, your under some ones easy control. No i don’t support a dog eat dog society we don’t have to accepting this LIE we can all be included in being a part of a supportive fair community.

(7). Wayne Martin: I agree; your standard of living is much higher than it is here in America – I lived in Scotland and Ireland for 6 years and the standard of living there was so much better than when I came home – I couldn’t believe how much better life was over there…when I retired, I was paying 54% in taxes, which drove me to retire. You are so right – you pay more in taxes, but you actually get something for them….

‪(8). Gwen Sheder‪ My husband made more money than that before he retired from the phone company three years ago. He got 6 weeks paid vacation. Our health coverage provided by his employer is the best coverage in the world. If we have health concerns it is taken care of immediately. We choose our own doctors. When my husband was having heart problems it was taken care of right away. He had a triple by-pass by a top heart surgeon. Out of pocket expenses was $500 USD. Also, he has a great pension. Our home and two cars are paid for. It does not get any better in the world than that. It is all about how you play your cards in America. He paid 30% in taxes. A lot less than Europeans. By the way people can get higher education for less than $21,000 at public intitutions. It is affordable if you know how to go about it. Also, people can get grants, scholarships, and government assistance for higher education. It is all a matter of making use of what is available.

(8. a). ‪Terry McCoy‪ Ummm.. yeah the only reason you your enjoying such a good life style in retirement is because of the union that your husband was a part of while working for the telephone company. In this day and age starting out as a young 20 something a family would be hard pressed to duplicate that life style

(8.b).Ruth Leahy‪ Gwen Sheder You are living in another Age that people today cannot access. That’s why the Scandinavian system is being touted. To stop people falling through the cracks. You totally miss the point. Lack empathy. If you could do it then anyone can. Sounds like it was your husband doing it anyway, not you per se. Those Days are long gone. Just because you had it “easy” doesn’t mean others can who are no lesser people than you or your husband. You haven’t even tried to walk in other peoples’ shoes yet you know! Nothing.

‪(8.c). Donna Richardson‪ No, the moral is “go back in time to when unions were strong and the Republican Party didn’t exist only to help the wealthy devour the middle class.”


Readers may, if time permits, go through many such statements from the link provided below given in two pieces. Add them together to reach the thread:



Also, the benefits assured under the social security system in Philippines:

Click to access DownloadContent


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Tracing the ‘hostages’: An attempt through the RTI Act !

During his speech at the time of presenting the budget, Hon’ble Finance Minister said that both the EPF and ESI had “hostages, rather than clients”. As this was contrary to truth, it was considered necessary to ascertain the basis on which the Ministry of Finance had included such a phrase in the speech of the Hon’ble Minister. It is in the interest of the working population to identify the caucus that caused such a term to be planted in the Budget speech.

An application under the Right to Information Act, 2005 has, therefore, been sent to the Ministry of Finance on 09.04.2015. Readers will be informed of the developments as and when reply is received from the Ministry of Finance.

The text of the application is as follows:


Mr. C.K. Ramaswamy,
Under Secretary (Budget Division),
Central Public Information Officer,
Ministry of Finance,
Room NO. 237,
North Block,
New Delhi – 110001

Sub: Application under Sec.6 of the Right to Information Act, 2005 – Speech of the Hon’ble Minister of Finance at the time of presentation of Budget – information – requested.


I would like to reproduced the following paragraph from the speech delivered by Hon’ble Finance Minister, Mr. Arun Jaitely while presenting the Budget of the Government in the Parliament on 28.02.2015:

“61. Madam Speaker the situation with regard to the dormant Employees Provident Fund (EPF) accounts and the claim ratios of ESIs is too well known to be repeated here. It has been remarked that both EPF and ESI have hostages, rather than clients. Further, the low paid worker suffers deductions greater than the better paid workers, in percentage terms…”

Hon’ble Minister has said
1. that the ESI Corporation does “have hostages, rather than clients” and
2. that the “low paid worker suffers deductions greater than the better-paid workers, in percentage terms”.

Both observations are not true, as we know. Because, the provisions for Exemptions enshrined in the Employees’ State Insurance Act, 1948, provide for exemptions from the coverage of the Act, to the factories or establishments, if only the employers make available benefits that are ‘substantially similar or superior’ to those provided by the ESI Act.

Getting such exemptions is a matter of right for the employers, as assured by the Act itself. It is so simple. There is a format in the ESIC offices for this purpose. There are three columns in it. The first one lists out the benefits provided by the ESI Scheme. The next column is to be filled in by the employer recording the benefits that he provides. The third column is intended to be filled by the employer wherein he would say whether, in his own assessment, the benefits provided by him are ‘substantially similar’ or ‘superior’. The employers must assess themselves first that way, before coming to the ESI Corporation for exemption. The ESIC will examine them and on being satisfied that the benefits provided by the employer are ‘substantially similar or superior’, recommend the case to the Central or State Government, as the case may be, for exemption.

But, in fact, none of the employers in the private sector could provide the package of benefits superior to those provided under the ESI Scheme. It is only the unwillingness of the employers to provide better benefits that keeps the employees within the fold of the ESI Scheme. Even the newspaper, The Hindu, an employer covered under the ESI Scheme, has, editorially, acknowledged, on 01.01.2005, that the package of benefits given by ESIC can rarely be matched by private employers.

So, in all probability, Hon’ble Minister might have, deliberately, been misled by various persons with vested interests, for ulterior reasons to belittle an organization of national importance. I, therefore, request you to kindly supply the following information under Sec. 6 of the Right to Information Act, 2005:

Kindly supply the copies of
(a) the filenotings, if any, received by the Ministry of Finance from the Ministry of Labour or
(b) communications, if any, received from other sources
based on which the contents of the aforesaid para 61 had been included in the Speech of the Hon’ble Finance Minister.

I send herewith Postal Order for Rs. 20 (Rupees twenty only) drawn in favour of the Pay & Accounts Officer, Department of Economic Affairs, New Delhi, Rs. 10 being the fee payable under the RTI Act, 2005 and the remaining Rs. 10 towards the photocopying charges of the filenotings or communications to be supplied.


Yours faithfully,


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ISSA chose ESIC for Good Practice Award-2012 !

ESIC got ISSA Good Practice Award-2012 !

The International Social Security Association chose India for the Award in 2012. The Award was given by the ISSA at Seoul on 30.10.2012.


“The ESI Corporation of India has made remarkable efforts to extend social security protection to the workforce in India,” said ISSA Secretary General Mr. Hans-Horst Konkolewsky.

In all, 41 nations participated in the competition meant for Asia and the Pacific 2012 and India got the first prize.

Launched in 2008, the ISSA Good Practice Award programme is organized on a regional basis over a three-year cycle, and has garnered international attention from social security institutions.


Yet, our Finance Minister had fallen victim to the Goebbelsian propaganda by vested interests and said that the ESIC held the beneficiaries as “hostages”. It is sad that middlemen who work against the interests of the society are allowed to influence the decision of the democratically elected Government.

We request the rulers who happen to occupy power-centres to approach  all the core issues with open mind, so that the final decision is correct and is really  in the interest of society as a whole. ESIC has done well. It could have done much better but for certain decisions at the level of the Ministry of Labour & Employment. It would be in the interest of the nation that the Scheme is run without corruption and political interference.

Press Note Page 1

Press Note Page 1

Press Note Page 2

Press Note Page 2

NB: The website thanks Ms. Meenakshi,  for her timely prompting through her letter in response to the previous article. 

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Thankyou Mr. Labour Minister! The insured population is grateful to you!!

The ESI Corporation meeting held today, the 7th April 2015, has decided to defer the matter pertaining to the amendments proposed to be made to Sec. 44 of the Act to enable the private players to have a role in the Social Security field. We are grateful to the Hon’ble Minister for Labour, the Chairman of the ESI Corporation, for having agreed to the suggestions of the Members of the ESI Corporation. That is grace and that is great! We thank all the Members of the ESI Corporation who helped the Chairman arrive at this correct decision.

While there cannot be two opinions about revamping the method of functioning of the ESI Corporation, the fact is that the private players who may desire to enter into this field cannot provide the package of benefits that is provided by the ESIC. The very fact that none of the employers at present is able to get exemption by satisfying the provisions of Sec. 87 of the Act testifies to this fact.

Here is a golden opportunity for the Hon’ble Minister for Labour to take it as an experiment to tune up the functioning of the ESIC. The action-plan for revitalising the organisation can start with the following:

1. Corruption control must be given priority. If sincere steps are taken in this regard, the organisation’s positive image will increase multi-fold. This organisation can be set apart as an experimental laboratory to see how corruption-control measures can result in improved public welfare.

2. First of all, the purchase procedure of medicines must be computerised so that it ensures transparency in finalisation of tender;

3. The methods of quality control of medicines supplied must be made transparent, without giving any room for collusion between the suppliers and the officers of the ESIC.

4. The dispensaries and hospitals run by the State Governments may also be supplied with medicines purchased centrally by the ESIC, so that there is uniformity of standards throughout the nation in all the ESIS institutions. The cost of the medicines thus supplied to the State Governments can be adjusted in the funds transferred to them, every quarter.

5. The Regional Offices, ESIC hospitals and dispensaries must be fixed with CCTV everywhere so that the demands for and acceptance of bribe can be monitored. There had been many cases where the allegations of demand of bribe had been found to be true from the demeanour of the persons involved but could not be proved satisfactorily. In such cases, the visuals from the CCTVs would have helped establish truth.

6. Proper transfer policies introduced in the year 2005 and implemented up to 2007 should be enforced, once again, in a transparent manner treating everyone alike, especially in respect of officers in the cadre of Social Security Officers and above. Treating everyone alike will result in obedience of everyone to law besides helping the administrators to resist political or other kind of pressure, if any.

7. Number of Inspections have been reduced. But, the fact is that the purpose of inspections is only to advance the purpose of the Act by detecting concealed employment and concealed wages. So, proper inspections may be encouraged. Honest employers would not have any grudge in producing their records and account books to the SSOs for inspection. Any corruption in the area of inspection, assessment of contribution, etc., can be tackled easily when the Administrators are given free hand.

8. The attitudinal change of the wavering staff members on the Administration side and those in the medical and para-medical side can be brought about, with adequately positive result, if they are made to understand that there is no scope for corrupt activity or indiscipline. Besides, all the staff members must be made to know the history of the scheme in depth. That will make them know that they are part of an organisation in a mission.

9. Moreover, the views of pseudo-intellectuals who are campaigning, vigorously, against the ESIC and EPFO, with their one-sided propaganda, by abusing their access to the power centres, should not be accepted as gospel truth as has been done while presenting the budget by including the word ‘hostages’ therein. The views of such persons must be made public and the views of the other side invited and examined with open mind.

Once an EPF Inspector in Maharashtra intimated his programme to visit a factory on a particular day. When, he was walking towards the factory, on that particular day, a person in a tea shop at the corner of the street, just accosted the EPF Inspector and provided him with precise details of employees working in the said factory but had not been covered under the EPF Scheme. His name was also in that list of such omitted employees. Such instances were many and ubiquitous.

It proves that the employees wanted EPF coverage and were ready for deduction of EPF contribution from their wages. Contributing to EPF is, thus, considered positively as savings by every employee. Even when there is no deduction of any kind from the wages, an employee would want to save and, therefore, set aside a portion of his earnings for the future. The employees would not resent deduction of EPF contribution, from their wages.

But, one spin-doctor, goes to town with his irrepressible tirade that this kind of recoveries amount to ‘confiscation’. What an ingenuous idea of trying to make the people believe that heaven is not heaven at all but hell ! One is reminded of Hitler who said, “By the skillful and sustained use of propaganda, one can make a people see even heaven as hell or an extremely wretched life as paradise”….



Press Release 07 04 2015

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Kind Attention, ESI Corporation Members! Please ask these questions on 07.04.2015!

“By the skillful and sustained use of propaganda, one can make a people see even heaven as hell or an extremely wretched life as paradise”….

– Adolf Hitler


There is a sustained campaign, now a days, in India, against the ESIC (and the EPFO too) by vested interests with ulterior motives. But, the fact is that Social Security can serve the public better only when in public sector. Paul Krugman, the celebrated Nobel Prize Winner of 2011 has examined the issue in depth and warned the American legislators not to fall victim to the propagandists of privatisation of social security. He warned the USA not to fall victim to the propagandists who wanted to privatise Social Security. Some of his findings can be seen from the article given below:

Paul letters copy

Yet, the Indian politicians indebted to hyper-rich businessmen do not care. And there are so many Goebbelses who pose as themselves intellectuals and act as middlemen for those hyper-rich to poach into and encroach the ESIC properties. They work as a ‘team’ to ‘lease’ or ‘sell’ the ESIC to the rich. They mix up the issue of purging corruption in an organisation with dumping the very organisation itself. Man made failures in the organisation cannot be used to blame the organisation itself. But, these anti-ESIC propagandists pretend otherwise. They do not want to accept the fact that such man-made failures were only because of the unholy nexus between politicians and bureaucrats.

They run away from facing facts or answering questions. They want to use any means to achieve their end of selling the organisation to private-sharks. Greed for large amount of money makes such men immune to sense of justice. That there is corruption in the Collector’s office does not lead one to do away with the Collectorate itself. That there is corruption in election does not imply doing away with the system of election itself. ESIC can be run successfully if it is allowed to run corruption-free.

The ESIC is the brainchild of great souls. It has been built up from scratches. It became a mighty organisation because of the sustained efforts of so many committed officers, staff in both the general and medical side. So many judgments of Courts uphold this fact. There are so many devoted and dedicated officers and staff members in the ESIC. Numerous success stories are there but the propagandists would not even have a look at it. The murkier side they project became murkier thus mainly because of the political patronage and interference in the System. A lot has been said about them in various Posts in this website. The propaganda of these anti-ESIC groups that privatisation would work wonders is a white lie. Such a stand is not based on empirical facts. On the other hand there is clear proof that the politicians who worked overtime for privatisation and globalisation had, actually, been cheating the public for long.

In the year 1993, Mr. Manmohan Singh & Co, had been batting for globalisation. One vividly remembers him and Mr. Chidambaram proclaiming day-in and day-out that globalisation would bring in glorious days for the nation and there would be transfer of technical know-how and what not.

Can anyone say what technical know-how has been brought into India by Coca-Cola and Pepsi during the past 22 years? Has any one examined the cost-benefit ratio of having allowed these two units to enter India? How much money is siphoned off by them out of India every year, as profit?

In the year 2011 and 2012, the same Mr. Singh, during the Independence Day address said that large section of children in India suffer from malnutrition. He said, on 15.08.2012, “We would achieve independence in the true sense only when we are able to banish poverty, illiteracy, hunger and backwardness from our country…. Malnutrition in children is a big challenge for us..” Dr. Singh was talking of ‘banishing’ poverty, 21 years after injecting his globalisation-liberalisation-privatisation-medicine in the body of the nation. When Germany had been reduced to ashes in 1945, she gathered herself up and became a mighty nation within a period of 20 years. Her DM attained full value in 1971, within 26 years. That economic miracle could be achieved by Germans because of the effective social security system of the nation.

Germany Social Security

 Social Security Germany

But, both Mr. Singh and Mr. Modi are afraid of having a look at these historical feats through Social Security run by public sector. Because, their aim is not welfare of the common-man but the welfare of the super-rich.

We, therefore, plead before the Members of the ESI Corporation to pose, at least, the following questions to the rulers, during the ensuing meeting on 07.04.2015 and obtain their reply duly recorded in Minutes. That way they can at least prevent another catastrophe falling upon the nation, although they had failed to prevent it last time before amending the ESI Act in 2010. The questions that are require answer from the authorities are:

Category I:

1. It is now said in Para 6.g. (Page 8) of the Summary Record of the 3rd meeting of the Sub-Committee on Medical Services and Medical Education held on 13.05.2014, that “Setting up and running of Medical Colleges is a cost intensive proposition in r/o capital cost, recurring cost, loss of revenue, etc.,” In Para 6.h (Page 9) of the same report, the Sub-Committee says that “based on current projections, the surplus funds of the corporation are likely to be negative by 2016-17.

◆ How is it then when the Bill 66 of 2009 for amending the ESI Act was introduced in the Lok Sabha, the Financial Memorandum said in Para 3 that “The Bill does not involve any expenditure whether recurring or non-recurring nature”.
◆ How was the Ministry of Law and the Ministry of Finance convinced to certify thus, when the Medical Colleges involve recurring expenditure?
2. The Sub-Committee of 2014 says, in Para 6.a (Page 8) that “no projections of requirements of doctors were made while approving the medical colleges. ESIC doctors (MBBS) under bond would be available only from 2020 onwards and the current requirement would have to be met from outside ESIC system. Graduate doctors are readily available in the market.”

◆ How is it that the Sub-Committee of the ESIC that proposed the amendments, in the year 2009, to the ESI Act said against Item 17 for insertion of the new section 59 (B) that “There is acute shortage of doctors and para-medical staff in ESI Hosptials / dispensaries with (which) is adversely effecting the delivery of health care services to insured persons. It is therefore necessary for ESIC to have its own Medical Colleges and other training institutions to produce doctors and paramedical staff.”
◆ How is it that when the Parliamentary Standing Committee on Labour asked the same question, it was given wrong information as reply?

◆ How did that Parliamentary Standing Committee made to become victim to wrong information and was made to give its approval for setting up medical colleges?

3. It is now said in the Hqrs. Memo. No. L-11/12/3/20-(Corporate Cell) / ME Cell dated 05.01.2015 that the “ESIC should exit the field of medical education entirely as it is not the core function of the ESIC”. How is it that the Advice Department of the Ministry of Law cleared the draft Bill on 26.06.2009, within a record period of two days, without examining the real issues involved in it which were legally and constitutionally objectionable? (For more details: —).

4. How is it that the ESIC authorities say, in their Memo dated 18.03.2015, that “Admissions to ongoing MBBS/BDS?PG courses at ESIC Medical Education Institutions shall be continued” when they proclaimed on 05.01.2015 that the ESIC was going to exit the medical education itself?

5. How is it that they invite further problem to the ESIC and create, thereby, problems to the future student community also by admitting one more batch of students, when they had gone on record saying that the ESIC “did not have the core competency to run medical colleges” and that the medical colleges may be handed over to ‘relevant agencies with capability and mandate to run medical colleges’ (Vide Item 6/1 of the Action Taken Report on the Record of Discussions at the Presentation made by the MOLE to the Prime Minister on 05.07.2014).

Category II:

The Members of the ESIC are requested not to yield to any kind of political or bureaucratic pressure once again, as they had done in 2008-2010. They are requested to ask the following questions also from the authorities on record:

A. Will the authorities assure that the Medical Colleges, Hospitals and the buildings of these institutions at Rajaji Nagar (Bangalore), K.K. Nagar (Chennai), Joka (Kolkata) and Dental College (Rohini) will never be handed over to any private players in future?

B. Or, will these four institutions also be handed over to private players, after some time and whether it was only for that purpose admissions are sought to be made for another batch of students ?

C. What is the difficulty for the authorities to conduct a comprehensive Consumer Satisfaction Survey to know the opinions of the beneficiaries about the functioning of the ESI Scheme in the public sector?

D. What sort of study was made by the authorities to examine the experience of other countries regarding privatisation of social security?

E. Was the International Labour Organisation consulted before embarking on such major changes? Because even before introducing the Bill in 1946, Indian Government had invited Mrs. Stack and Mr. R. Rao to study the proposal of Dr. Adharkar and the draft Bill and offer their suggestions. The final Bill that became ESI Act was as per the suggestion of the ILO only.

Category III:

In addition, the following ten questions posted earlier under a different thread “Moving the court of law …” may also be raised by the Members so that the public whom they represent get appropriate reply in time. Those ten questions are also reproduced here for easy reference please:

1. Where is the provision in Sec. 59-B to empower the ESIC to run the “medical colleges” through private players or even through State Governments? Such third party participation is permitted by Sec. 59 (3) only to run the ESI Hospitals and not Medical Colleges. How can the ESIC mix up Sec. 59(3) with Sec. 59 (B)?

2. Besides, the basic issue is, where is the continued need for the ESIC to run medical colleges and also to seek PPP for that purpose, when it has found out that it is not its core activity, at least, now?

3. When the Administration has admitted that the buildings of 8 more medical colleges are only “under construction”, why should it not forget about medical colleges but use the infrastructure created, for some other purposes, in such a manner that it generates permanent rental income to the ESIC to add to the ESI Fund, to offset the money lost during the last six years?

4. Is it obligatory for the ESIC to run those medical colleges through proxies, either through the State Government or through PPP or through other methods (as implied from the world ‘etc’), just because buildings have been constructed or just because the MCI is going to give permission to it?

5. When the Private Players are allowed to run the medical colleges, will they be running it as per their own licence or by using the licence obtained by the ESIC from the Medical Council of India?

6. If the ESIC is using the licence obtained by it for running the medical colleges and allowing that licence to be used by the private players, will it be legal, when the ESIC has gone on record saying repeatedly that running the medical colleges is not its core activity?

7. Would those private players be able to get permission from the Medical Council of India to run medical colleges on their own? Are these private players permitted to be the beneficiaries of the misadventure and discomfiture of the ESIC in having illegally started construction of buildings spending thousands of crores of rupees from the year 2008?

8. How is it that some private players like Reliance, SRM and others are reported to have already entered the premises of various (proposed) medical colleges at Coimbatore, Joka and other places, officially and inspected the infrastructure under construction?

9. Is it true that those private players would admit students under Management Quota to make money, using the licence granted to the ESIC for starting medical colleges?

10. What is the significance of giving only 15 days’ time to the State Governments to accept the Terms and Conditions framed by the ESIC before and for inviting the private players to have a role in running the medical colleges on behalf of the ESI Corporation?

We request the Members of the ESIC not to fall prey to the one-sided propaganda of the ‘team’ of pseudo-intellectuals who make their living by brokering for the rich and crushing the poor. They can make easy living that way; can have direct links with power-centres; can enjoy the glory of getting articles published in news papers. But, that is not in the interest of the working population. The members of the ESIC have a vital role to play on 07.04.2015 to save the nation from chaos and for that purpose they should not fall prey to the propaganda of various kinds against the ESIC without hearing the other side.


“The receptivity of the masses is very limited, their intelligence is small, but their power of forgetting is enormous. In consequence of these facts, all effective propaganda must be limited to a very few points and must harp on these in slogans until the last member of the public understands what you want him to understand by your slogan”.

– Adolf Hitler


Paul Krugman
We thank the Members in advance for asking these questions!


1. Report contaiing the recommendations of the ESIC Sub-Committee for establishing medical colleges:



ESIC Sub-Committee wants to establish medical colleges and prepares ground for amendment that came in later in 2010.



Admission before the PM in 2014 that the ESIC does not have core competency to run medical colleges


ESIC Sub Committee of 2014 says the decision to open medical colleges was wrong.



Filed under Amendment 2015

Beware of the Demolition Squad, Mr. Prime Minister! ESIC is the symbol of Civilisation!!

During a meeting of the ILO in the year 1922, When many other countries had introduced various social security measures the Indian Government was wavering. So one member said that among the civilised countries, India was the only country where there was no social security measure. That was an indication that the world considered social security measures as an index of civilisation. The nature of benefits provided in every country under the Social Security Scheme is the indicator of the degree of civilisation achieved by the people of that county.

When Mr. Joshi, the Indian member heard the aforesaid comment in the world body, he got provoked and said that India would bring in legislation for compensation for employment injury. The Workman’s Compensation Act, came into existence next year in 1923 only because of that promise of Mr. Joshi, the Indian representative, in that world body. That was how India took her first step to enter into the civilised world.

The Royal Commission of Labour which toured India for two years from 1929 to 1931 submitted its report stating that the incidence of sickness was more in India than in any other country and the need for sickness insurance was more in India than in any other nation.

The Beveridge Report

The Committee headed by Sir William Beveridge examined the issues pertaining to labour  for one and a half years and submitted, in November 1942, an exhaustive report which paved way for a civilised society. His report aimed at ‘shaping the economy to serve the people’, while the rich and powerful had vested interest in ‘shaping the people to serve the economy’.

Sir William Beveridge in 1944. He became hero overnight when his report was tabled in the House of Commons in December, 1942. Photo Courtesy: The Guardian, U.K.

Sir William Beveridge in 1944. He became hero overnight when his report was tabled in the House of Commons in December, 1942. Photo Courtesy: The Guardian, U.K.

ESI Corporation was not born in a day. It took more than a year and half for Prof. Adharkar to go through the report of Sir William Beveridge to adapt it to Indian conditions. Comprehensive analysis was made on the issues relevant to our nation. The report was submitted by him on 15.08.1944. Consequently, when the ESI Act was enacted in 1948, the responsibility of running the Scheme was vested in the Government.

Art. 41 insists on “Public” Assistance

The founding fathers had rightly entrusted the responsibility of running the Social Security Scheme to the Government only. That was why Art. 41 of the Constitution directs, as under:

“The State shall, within the limits of its economic capacity and development, make effective provision for securing the right
◦ to ……,
◦ to …………,
◦ to public assistance in cases of unemployment, old age, sickness and disablement, and in other cases of undeserved want”.
The Art. 41, thus, gives direction to the State that in cases of Sickness, disablement and in other cases of undeserved want, the State is to provide “PUBLIC ASSISTANCE” . The State cannot, therefore, make provisions for “private assistance” and wash its hands of the affairs. The responsibility for Maternity relief was placed on the shoulders of the Government only as per Art. 42.

ESIC reviewed repeatedly

The scheme was made operational in 1952. Many Committees had reviewed the ESI Scheme periodically. They were: The ESIS Review Committee (1966), the Estimates Committee of Parliament (1969-70), the Committee on Perspective Planning (1972), the High Powered Committee on Amendments to the ESI Act (1978), the ESIS Review Committee (1982), Committee on Perspective Planning (1993) and The Report of the Working Group on Social Security for the Tenth Five Year Plan (2002-2007). The meeting of this Working Group said, as under in its Minutes dated 03.07.2001:

“There is need to take new initiatives to extend the spread and reach of the existing social security schemes being administered by the Employees’ State Insurance Corporation and Employees’ Provident Fund Organisation.“

Six Principles of Beveridge

Beveridge had codified Six Principles of Social Insurance. Two among them were the element of compulsory contribution from each insured person and his employer and the “Unification of Administrative Responsibility” through a single Social Insurance Fund. The report of Prof. Adharkar also emphasised the same. The Scheme in India is run by the Government to assure the insured population and the employers that the funds would be managed as per rules, the scheme would be run corruption-free and the defaulting employers and erring employers would be penalised by the State itself. That was a guarantee to other employers and employees that there would be equality in applying law. The grievance redress mechanism under any Government would be open and transparent.

Best financial management in ESIC

The Scheme had been run in a satisfactory manner, in spite of many negative actions of the corrupts and zombies, within the organisation and in the enforcing machinery of various State Governments. If the political leaders had been more committed in the welfare of the people, the Scheme could have done much better. Even in spite of all the pitfalls, the Scheme had been better managed financially than any other public sector autonomous body until the year 2007. Better than private units. The Economic times 05.02.2003 would testify to it.

Economic Times 5 2 2003 copy

Overbearing and misguiding bureaucracy

Any dilution of the the scheme would be challengeable successfully in Court of Law and would expose the Government having fallen victims to the misleading notes of the bureaucrats. Politicians falling victims to the bureaucracy had been brought out very clearly in the famous serial ‘Yes, Minister’. Indian scenario is not different in any manner. Occasions are numerous when the elected Ministers just sign on files as desired by the bureaucrats. India has seen many bureaucrats becoming Ministers and Prime Ministers too, only because the elected politicians could neither understand nor cope with the tactics used by the bureaucrats to bend them to the will of the latter.

During the discussion in the House of the People on 23.03.1992, Mr. A. B. Vajpayee blamed that the bureaucrats were more responsible for creating economic crisis than the political leadership. His statement is one of the many evidences available to prove that the Ministers are led and are not obeyed by the bureaucrats.

The following are the excerpts from the Indian Express dated 24.03.1992:
“Mr. Vajpayee hit out at the bureaucrats, five or six of them, who kept shuttling between the Prime Minister’s office, the North Block and the Planning Commission, and also the IMF, and said they were more responsible for creating the current economic crisis than the political leadership. These officers should not be entrusted with negotiating the Dunkel proposals at the GATT meetings, he cautioned”.

Intention is only to “reduce” benefits 

Private players are free to provide any kind of benefit that matches and surpasses the ones provided under the ESI Act. There is no need for any adventurous dilution of the provisions of ESI Act. There must be proper in-depth study before embarking on any such adventures. If needed, even a pilot project can be formulated and tested. The international experience on such privatisation must be examined. The information already received by the ILO on this issue was only in the negative about such privatisation. There should, therefore, be no reliance only on the filenotings of the bureaucrats to tamper with the existing system just in order to facilitate private players in social insurance. That would result in the private players playing havoc with the living conditions of the working population.

They enter into this field to make money, to prepare profit and loss account while the ESIC as a State machinery prepares Income and Expenditure account. Any hasty measure to allow private players by diluting the provisions of Exemptions under Sec. 87-91 would, clearly, prove that the intention of the rulers is only to reduce the quantum of benefits that are made available now to the working population in the organised sector.

Customer Satisfaction Survey

The Government of Gujarat had conducted a Customer Sastisfaction Survey among the public when Mr. Narendra Modi was Chief Minister of Gujarat in the early 2000s about the services rendered by various departments, as informed by Shri Hasmukh Adhia, IAS, Secretary, Administrative Reforms & training and Director General, SPIPA, Government of Gujarat, during his lecture in the Indian Institute of Managment, Ahmedabad.

Similar survey proposed in the year 2006 in the ESIC had not materialised. One such survey among the beneficiaries of the ESI Scheme would not be out of place, now, before venturing on misadventures. Gujarat Gas Company Limited conducted Customer Satisfaction Survey to understands its own strength and weaknesses.


It was adjudged the best managed company of the year 2004-05 by the Business Today.


Beveridge worked hard and conducted extensive study on various issues for one and a half years to prepar his monumental document and when it was made public,  he became a national hero overnight in the United Kingdom. In India, the bureaucrats do not show any intention to study the issues and impacts by conducting any study but work hard to demolish the scheme overnight.

A cursory survey had been conducted in Mumbai once in the 1990s. It showed that 85% of the employers wanted the scheme while 85% of the employers did not want it. The Regional Directors of Maharashtra would testify to it. So, any radical change in the concept and structue must be preceded, necessarily, by proper study and analysis from all angles.

ESIC can work wonders

We reiterate that as far as the ESIC is concerned the System is correct but the men need to change their attitude. That can be done, when the political leadership is committed to run the Scheme corruption-free. When done, ESIC can work wonders for the improvement of the nation’s economy and prove to the world that our nation is really a civilised nation.

What is more, India can even surpass many nations and reach the top in the Human Development Index. The Scandinavian countries top the Index at present, only because of social security measures which are run corruption-free. That is civilisation.

For more, read ‘Barbarism and Civilisation: History of Europe in our time – Bernard Wasserstein. 

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Sorry! No ‘hostages’ there, Mr. Finance Minister!

The following are the excerpts from the speech of the Finance Minister, Mr. Arun Jaitely while presenting the Budget of the Government on 28.02.2015:

“61. Madam Speaker the situation with regard to the dormant Employees Provident Fund (EPF) accounts and the claim ratios of ESIs is too well known to be repeated here. It has been remarked that both EPF and ESI have hostages, rather than clients. Further, the low paid worker suffers deductions greater than the better paid workers, in percentage terms.

62With respect to the Employees Provident Fund (EPF), the employee needs to be provided two options. Firstly, the employee may opt for EPF or the New Pension Scheme (NPS). Secondly, for employees below a certain threshold of monthly income, contribution to EPF should be optional, without affecting or reducing the employer’s contribution. With respect to ESI, the employee should have the option of choosing either ESI or a Health Insurance product, recognized by the Insurance Regulatory Development Authority (IRDA). We intend to bring amending legislation in this regard, after stakeholder consultation.”



We, first of all, thank Mr. Arun Jaitely that he has chosen to consult the stakeholders before making amendments to further his observations on ESI Scheme.

In regard to his proposal to allow option to the employees to choose either ESI or a Health Insurance product, recognized by the IRDA, we have already brought out the well-known fact the medical benefit provided by the ESIC is just one of the many benefits and that it has close connection with important cash benefits like Sickness Benefit, Extended Sickness Benefit and also Sickness arising out of pregnancy and Sickness arising out of Confinement, Sickness arising out of premature birth of child or miscarriage.

In the present write-up we would like to remind the Minister just one fact which might not have been brought to his notice by the overzealous bureaucrats who wanted to please him so that he could, in turn, please the private players who would be pleased if the ESIC, which affects their area of operation, is not there.

The Minister has gone on record having said that the ESIC does “have hostages, rather than clients”.

The fact is that the ESI Scheme is run by government. Mr. Arun Jaitely belongs to that Government now. And his statement implies that he is of the opinion that the Government of India does have hostages through its ESI Scheme and not clients.

But, the employers through whom and with whose  active co-operation the scheme is run, would not and cannot say that they are held hostages. The ESI Act is not a compulsory provision. Because, the employers are free to get themselves and their employees totally exempted from ESI coverage.

Sections from 87 to 91-AA deal with exemptions. If the employers are able to provide benefits which are ‘substantially similar’ or ‘superior’ to those provided by the ESI Corporation, they can, as a matter of right, demand exemption from coverage under the ESI Scheme.

It is so simple. There is a format in the ESIC offices for this purpose. There are three columns in it. The first one lists out the benefits provided by the ESI Scheme. The next column is to be filled in by the employer recording the benefits that he provides. The third column is intended to be filled by the employer wherein he would say whether, in his own assessment, the benefits provided by him are ‘substantially similar’ or ‘superior’. Let them assess themselves first that way, before coming to the Minister and saying that the ESIC is holding them and their employees hostages.

The ESIC had successfully challenged all the employers, on many an occasion, whether they were ready to provide benefits on par with those provided by the ESIC. But, none came forward.

The Private Players do not want to provide all the benefits provided by the ESIC. Their intention is not to provide ‘social security’ but to ‘earn profit and throw a portion of it to all the political parties’.

But, ESI Act is for the welfare of humanity. It has kindness in-built. The deficiencies in providing service were and are only man-made and they can be set right by committed leadership backed by the Labour Ministry committed for honesty and transparency in running the organization. “Cleaning corruption is like cleaning the stair-case. It must start from the top”. There had been many an illustrious era that the ESIC has seen in its 63 years of existence, although it had seen many dark spells too.

ESIC has the capacity and can make the nation strong economically, if it is well-run.

We, therefore, request the Hon’ble Finance Minister not to rely only upon the convenient filenoting submitted by his pliant bureaucrats without studying the 210 years-old poignant and heart-rending history behind the ESIC.


The Finance Minister may better advise the employers to give all kinds of cash and medical benefits to their employees in a better manner than what is provided by the ESIC and seek proper exemptions as per the existing law itself. There is no need for amendments of any kind to the ESI Act, 1948, if the advice given to him by the bureaucrats was to free the ‘hostages’. For ready reference, we provide, in the following link, a presentation on the provisions in the ESI Act, 1948 that govern Exemptions:


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