Report No. 30 of 2014 - Performance Audit of Employees’ State Insurance Corporation of Union Government, Ministry of Labour and Employment

Date on which Report Tabled:
Fri 12 Dec, 2014
Date of sending the report to Government:
Government Type:
Union Department
Sector Social Welfare


The Government of India has been enacting a number of legislations in the area of social security. Employees State Insurance Act, 1948 is an important Act in this regard. The Act provides certain benefits to employees in case of sickness, maternity and employment injury in factories or establishments employing minimum number of workers as determined by the Government. The Government of India, Ministry of Labour and Employment administers the Act through Employees' State Insurance Corporation (ESIC).

Outstanding dues on account of contribution from covered estab-lishments amounted to RS 1655.42 crore as of March 2013, of which RS 1001.82 crore was not recoverable. Non-initiation of timely action to determine the dues resulted in cases becoming time-barred and consequent loss of revenue amounting to RS 48.31 crore. Advances of RS 20.31 crore given to hospitals as of March 2013 were lying unadjusted in eight States. Substantial difference of RS 556.59 crore was observed between challans generated towards contribution to be paid by the employers and actual receipts.

Approximately 12000 ESIC employees had been irregularly availing medical benefits from ESIC dispensaries/hospitals without paying though the facilities were meant for only insured persons paying contributions. There were shortfalls in meetings of Standing Committee, Medical Benefit Council, Regional Boards and Hospital Development Committees. Regional Boards were not reconstituted in nine states though their tenure expired during 2004 to 2011. Shortfalls in conducting surveys/inspections/test inspections led to ineffective coverage of the scheme.

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