As the national economy undergoes change and consolidation in response to the changing world economic order, special efforts are being mounted by the Government to soften the impact of transition, particularly on the working class. The Employees Provident Fund (EPF) Organisation sees its role in the forefront of such effort. To fulfil this role the EPF has put in place a plan for strategically repositioning itself as a customer focused growth driven organisation. This plan, titled Reinventing EPF India was unveiled on June 28,2001. It will be implemented incrementally within a time frame of three years.
High Impact Agency
The EPF Organisation recognises itself as a High Impact Agency of the Central Government. Its 2.4 crore members taken with their families add up to about 10 crore citizens. Consequently, EPF accepts that the quality, content and efficiency of its programmes and service will make a significant and visible difference to the public face of the Government as a whole in the eyes of citizens. Further, the 3.27 lakh businesses or other institutions within the compliance crucible of EPF influence public opinion through the media and other forums in a manner which far outstrips their actual numbers.
Span of Business
Currently the EPF delivers service to over 2.4 crore subscriber members from its 260 geographical locations across the country. These are benefits in the nature of income replacement on account of superannuation, disability, job loss or death. Three programmes that presently provide such income replacement are the Employees Provident Fund Scheme, 1952, the Employees Deposit-Linked Insurance Scheme, 1976 and the Employees Pension Scheme, 1995.
During the financial year 1999-2000, the business of the EPF Organisation included gaining compliance from 3.27 lakh businesses in order to credit the accounts of 2.4 crore subscribers. Nearly, 40.07 lakh claims were settled and amount disbursed to members through separate cheques. Additionally, the EPF organisation issued 3.07 crore annual statement of accounts to its members and paid monthly pension to 7.38 lakh retired employees.
Market Share and Growth
The EPF is the industry leader in the Provident Fund & Pension business. It has, however, a very small percentage of market share. Today, the vast majority of workers in the informal sector have little or no income support for old age. The new economy has created jobs in the informal sector but there is increasing stagnation in the formal sector. The reach of EPF in the informal or service sector is insignificant and it is this sector which is targeted for growth in any plan that seeks to expand membership.
The EPF has been internally articulating this concern. Therefore, it has crafted a plan that seeks to strategically re-position EPF as the key agency for the management of social security programmes in the country.
The EPF recognises that the key to growth and strategic repositioning is significantly increasing the confidence and comfort level of existing subscriber members on the one hand and the creation of a facilitating compliance environment on the other. Only a much higher comfort level amongst clients will lead to buy in into the programmes and the desired growth.
The plan seeks to strategically reposition the Employees Provident Fund as a frontline provider of Provident Fund, Pension and other old age income security projects meeting world-class standards of quality, timeliness and efficiency.
In January, 2000 Dr. Satyanarayan Jatia, the Union Labour Minister and Chairman, Central Board of Trustees, Employees Provident Fund Organization put in place a major policy initiative with two objectives. The first objective is to convert Employees Provident Fund India into a customer-centric organisation focused on geometric growth that is 20 to 30 per cent annual growth as opposed to the traditional incremental average annual growth of 6.6 per cent. According to the second one, in the short term, leverage available internal resources and legacy computer programmes to significantly improve compliance and subscriber service.
The plan has undergone an intensive planning and thinking through process with active technical expertise and support from the Ministry of Information and Technology and the Indian Space Research Organization (ISRO). The project will re-engineer the organisation and business structure and will enable the redesigned business process with Information Technology.
The projects objective is to put in place a significantly strengthened and upgraded national institutional framework that will enable a customer-centric geometric growth in the spread and reach of old age income security to the working class.
Currently, old age income security protection is available to 26 million or under 10 per cent of the estimated working class population. The modernisation programme seeks to build up the capacity of EPF to enable it to significantly close the uncovered gap. This will specifically focus on the growing ranks of casual labour and employment in the newly emerging post- manufacturing service economy.
The immediate project goals are to establish a system that will enable a worker to access his or her account current balance through appropriate devices (KIOSKS) in any of the 267 EPF outlets across the country. It will also enable any worker to submit a claim at any of the 267 offices, regardless of where he or she is currently or last employed and to get the claim settled within 2 or 3 days.
The modernisation programme seeks to create an information-driven compelling compliance regime that will promote voluntary compliance and at the same time quickly identify and correct delinquency by habitually visiting such delinquency with all the penal and legal consequences.
The project has passed the planning mode and is now in the implementation mode and will be implemented, in the first phase, in six clusters spread across the country in the next 24 months against an inflexible timetable.
The project has been designed with both medium -term and short-term goals. In the next three months, the process of registration will start. This will involve the issue of a nationally unique identity number to each member of the Fund along with a Smart Card that will carry the employees pass book. The unique number-SSN (Social Security Numebr) will remain employee- specific regardless of the identity of the employer or any change in employment. This will enable participation of even casual and migrant workers who will be able to access their account from any location.
Once the different elements of the project are stabilised on the ground, the quality of service and the corresponding comfort level of the members in relation to participation in the schemes will show a significant improvement leading to the envisaged geometric growth.