Trade Unions reject proposal to swap ESI benefits for health insurance

NEW DELHI: Trade unions have rejected a proposal to allow workers to opt for a health insurance product instead of benefits under the Employees’ State Insurance scheme, dealing a blow to the government’s intent to open up huge business opportunities for private insurers.

Stakeholders, including trade unions and employers’ representatives, opposed the proposal at a tripartite consultation to discuss the Employees’ State Insurance (Amendment) Bill on Thursday.

About two crore organised workers are insured under the Employees’ State Insurance Act of 1948. With their family members also entitled to the benefits, the total number of people covered by the scheme is about eight crore. The amendment bill that’s under consideration proposes the addition of a section that would give workers a one-time option to choose a policy recognised by the Insurance Regulatory & Development Authority in lieu of benefits available under the ESI Act. Workers would also get a one-time option to return to the staterun scheme.

The change, which finance minister Arun Jaitley proposed in his budget speech of 2015, was rejected by the majority of the stakeholders on the grounds that the Employees’ State Insurance Corporation provides unlimited benefits against a small contribution, while mediclaim policies are based solely on commercial interests of private companies.

“The schemes operated by ESIC are funded by the covered employees and the employers and should not have been the subject of the government’s budget,” said Prasanta Nandi Chowdhury, national secretary of the Centre of Indian Trade Unions. She said the government should withdraw its hasty attempt to implement this amendment. “The move reflects the high-handedness of the government and hijacking of the ESIC. This is totally unacceptable and hence the proposed amendment deserves to be outrightly rejected,” said Ram Kishore Tripathi, secretary of the Hind Mazdoor Sabha.

The amendment is also being opposed by the Bharatiya Mazdoor Sangh, an affiliate trade union of the Rashtriya Swayamsevak Sangh.