Social security: cover for all
There is little not to like about the contribution-based social security scheme unveiled by Prime Minister KP Sharma Oli on Nov 27. From now on, all working Nepalis in formal or informal sector, and both private and public enterprises, will contribute 11 percent of their basic monthly salary to the new Social Security Fund. This will in turn be topped by another 20 percent by their employers. As workers will be entitled to nearly two times more money than they have to deposit, it will be in the interest of all working individuals, irrespective of their income size, to enlist.
Of the 31 percent, 1 percent will cover medical treatment; 1.4 percent will cover accidents; 0.27 percent, dependent family members; and 28.33 percent, old-age pensions. While other coverages will be activated after six months of paying into the social security pool, the old-age pensions may be claimed by those over 60 who have contributed to the fund for 15 years. Any way you see it, the start of the first-of-its-kind universal social security scheme is a landmark for Nepal. It is also perhaps the first major step towards the creation of the kind of socialist, welfare state envisioned by the new constitution.
It is indeed a monumental development for low-wage workers who heretofore had it hard, many of them unaware where their next meal would come from. Now, for a minimal contribution, they will be able to better plan their future. But first, the scheme needs to work. Questions have been raised regarding the potentially trillions of rupees that could be collected. With such gigantic sums involved, how will transparency and good governance be ensured? And when that is cared for, what will be done with the money? One good idea is to invest it in big-ticket national projects.
But before all that, how will the ‘basic salary’ of each contributing worker be determined? Many industries and businesses don’t pay their workers mandated basic salary. These employers will now have to increase their salary bill, an issue over which they have tussled with successive governments. Nor was the way PM on Nov 27 Oli took nearly all the entire credit for the scheme seemly. But however the scheme was unrolled, there is no gainsaying its potentially life-changing impact on millions of Nepalis.
Bidya Devi Bhandari: God save the Queen
And poor old Ram Baran Yadav was being pilloried for acting hoity-toity on the job! But compared to the excesses of his successor as the country’s president, Bidya Devi Bhandari, the medical doctor is turning out to be rather saintly. It would be stretching it to say that Yadav was attuned to public sentiment. If so, Bhandari is tone-deaf.
From getting sitting Supreme Court judges to kneel down to receive Dashain tika from her blessed hands, to making motorists wait for hours as the police clear the way for her illustrious motorcade, to lavishly spending people’s hard-earned money on luxury cars, the communist president is perhaps the epitome of the kind of crony capitalism that her mother party likes to rail against.
Arguing that the aging fleet of cars belonging to the previous president is unreliable, Shital Niwas now wants to replace the whole fleet, a noble task for which the government has just approved Rs 140 million, on top of the Rs 40 million that had already been disbursed for the same purpose. It is unclear why a ceremonial president needs cars with top security features. Or why she needs different vehicles for ‘formal’ and ‘informal’ use. But the new queen of republican Nepal has asked for it. And my word, she shall have it.
So what if people rain all kinds of curses on her for delaying their travel home, as the roads her majesty will travel on are cleared of all vehicles, nay, even pedestrians, an hour in advance? So what if the only well-oiled academy of national police has to be dismantled to expand her bungalow? So what if she is being heavily criticized even within her own party for supposedly besmirching the name of her husband, Madan Bhandari, the preeminent Nepali communist hero? Her highness does not care. She does not have to care.
The request for new cars has been routed through the Nepal Army, supposedly as the president is their ceremonial head. By doing so she perhaps hopes most of the blame will be deflected off the glistening pillars of the ‘Cool Residence’. And it just might, you know. She will not be the first head of state in Nepal who thinks the country is hers for the taking. On current evidence, she will not be the last.
Murky business in Nepal Airlines
Who wouldn’t love to see the country’s flag carrier fly to every conceivable destination in the world, proudly bearing the national standard? There was thus a lot of excitement when, in 2017, Nepal Airlines bought two Airbus A330-200s. The addition of the ultra-modern 247-seater, long-range aircraft, the NA management promised, would herald a new era in Nepali aviation. But there was just a wee problem. Till date, in the absence of proper paperwork, it is not even clear that the NA actually bought the two aircraft.
It has been a murky affair all along. First, instead of buying the aircraft directly from Airbus, the NA management decided to purchase them through the US-based AAR Corporation, at $209.6 million apiece. Interestingly, the AAR didn’t have the aircraft. The NA then decided to get the two planes from the Portugal-based ‘Hi-Fly Airlines’. In another bizarre twist, when the NA got the delivery, it was from the Ireland-based ‘Hi-Fly X’ (no relation to the Portugal-based company). Again, if the NA management had nothing to hide, why didn’t it get the planes directly from Airbus? And where are the papers that prove the NA’s ownership?
Unable to come clean on the series of exposés that our sister publication Annapurna Post has been running on the issue, Nepal Airlines CEO Sugat Ratna Kansakar has taken to Twitter to accuse “a prominent media” of “unnecessarily…dragging into controversy a third party, an esteemed internationally reputed company Airbus”. He also suggested that the Nepali media act with “a sense of responsibility” and not destroy the country’s fledgling aviation sector.
He seems to have gotten it backward. The reason this media organization has been running this series on the NA is that it wants, first and foremost, a robust aviation sector, which is vital if Nepal is to realize its tourism potential. For this it is important that our national flag carrier be in rude health, and able to compete against the best in business, at least in South Asia.
The prime minister is reportedly keen on getting to the bottom of the issue but other cabinet ministers and top bureaucracy are apparently unwilling, perhaps because some of them personally profited from the gargantuan deal. This is not inconceivable. In the past, no less than a sitting prime minister has been charged with profiting from NA’s aircraft lease. The current government’s goal of bringing two million tourists by 2020 is laudable. But that will be a tall order if has to rely on a corruption-ridden and ailing national flag carrier.
Bista’s Malaya coup
Any way you look at it, the recent labor agreement between Nepal and Malaysia is a landmark deal. Nepali laborers will henceforth not have to pay a single rupee to go and work in what is Nepal’s number one labor importing country (besides India), with a floating population of around Nepali 400,000 workers. The recruitment service charges, two-way air fares, visa fees, medical check-up cost—all will now be borne by the employers in Malaysia. Nepal government had stopped sending workers to Malaysia five months ago, in protest against the hefty fees being imposed on its poor workers: on average, a worker had to fork out at least Rs 80,000 to cover all costs.
Minister for Labor Gokarna Bista had gotten a lot of flak for it. The south-east Asian country could never be forced to accept Nepali workers, the critics said, when it could easily import cheaper labor from Bangladesh and Pakistan. But Bista held his ground, firm in his belief that the quality of Nepali workers was superior—in that they are considered more adept and reliable—than those from other competing labor-exporting countries. His faith has been vindicated. This is another feather in the cap of Bista, who in his earlier avatar as the Minister of Energy had also done a commendable job.
Manpower agencies in Nepal are now cribbing and complaining. According to the new agreement, they will from now on be paid directly by the companies hiring Nepali manpower. Their cut will amount to half a month’s salary of the recruited worker. They say it is nearly not enough to cover their costs and have threated to stop recruiting people to go to Malaysia if they cannot get at least a month’s salary of the recruited workers. The way we see it, with Nepal exporting an average of around 600,000 workers a year, the manpower agencies can still earn enough. If they want still more, they are in the wrong business.
No business should be allowed to thrive on exploitation of some of the poorest people in the society. Having inked the deal with Malaysia, the government must now not give in to the manpower agencies’ pressure tactics. It is unlikely to, in any case. Rumors are that the government is preparing similar agreements with other big importers of Nepali labor in the Gulf. Perhaps the days of the unscrupulous manpower agencies are truly numbered.