Once the Labour Code on Security and Welfare is put into effect, schemes like provident fund, pension and insurance schemes run under the EPF Act, 1952, and the sickness benefit scheme under the ESIC Act, 1948 will no longer exist in their present forms.
The Labour Ministry has restructuring and reorganisation on its mind as it plans to change the face of several schemes and give states more discretion.
The proposed change means that organisations including Employees' Provident Fund Organisation (EPFO) along with its board of trustees and Employee's State Insurance Corporation (ESIC) and the director-general of welfare will be deconstructed and brought under the umbrella of National Security Council and Central and State boards (NSSC). The new structure will be responsible for monitoring and keeping a check on the various social security schemes and funds in the country.
According to a Financial Express report, once the Labour Code on Security and Welfare (LCSW) is put into effect, schemes like provident fund, pension and insurance schemes run under the EPF Act, 1952, and the sickness benefit scheme under the ESIC Act, 1948 will no longer exist in their present forms.
The government has proposed this revamp to decentralise the structure and also to give states more money. To serve this purpose, each state will have Social Security Funds (SSFs) and the existing 16 social welfare schemes will be divided among the SSFs.
Also, the 17 crore subscriber accounts under the EPF will be divided among SSFs in each state proportionate to subscriber bases, fund sizes. For the division of the accounts, government will consider the size and money each state requires.
EPFO funds under the pension and insurance schemes will be divided among each state based on the number of subscribers in each state.
The state boards will be in charge of both SSFs and their respective scheme funds.There are 34,000 employees working at EPFO and ESIC and the divide will be equal for the new structure. Grade A officers within both these organisations will work with the Central Board or NSSC. Rest of the employees will be deputed to the state boards where they are currently posted.