The anomaly came to notice when authority assigned to implement the program went through the budgetary allocations for the fiscal year. “Workers throughout the country paid well over Rs 450 million in the fund in 2010/11. However, the government has allocated just Rs 100 million in the fund,” said a source.[break]
The existing law clearly states that the fund contributed by workers through one percent SST will be maintained in a separate revenue heading and will be used for financing different social security programs for workers.
“This is a foul play. The collections from SST should have been transferred to the fund straightaway,” said former finance secretary Rameshwar Prasad Khanal.
Interestingly, MoF officials give different argument, not even bothering what the law says. “We allocated only Rs 100 million because the fund manager has not yet managed to make use of Rs 50 million allocated last year,” said Bodh Raj Niraula, head of budget division, MoF.
Other officials even said that allocating all the money to the idle fund was meaningless.
“If the fund manager started implementing the schemes and required additional money, we can always release funds,” said Niraula.
Surprisingly, the statements of senior MoF officials go against the concept with which the fund was created in 2009/10. The fundamental idea of the concept, enforced by the then Finance Minister Surendra Pandey, was to generate a fund through contributions of workers, employers and the government.
While the immediate goal of the fund was to provide insurance and other facilities to the workers, its long-term goal was to develop a well-sustained National Social Security Plan that will cover all citizens.
“Clearly the arguments of MoF officials reflect foul play on the part of the government,” said an official at the Ministry of Labor and Transport Management (MoLTM).
“The meager budgetary allocation by MoF means that we won´t be able to implement the schemes this year as well.”
Krishna Bahadur Raut, executive director of Social Security Fund Management Committee (SSFMC), said the committee had requested the government for Rs 39.4 million to set up the office and complete all arrangements to implement the programs. “But the budget allocated just Rs 10 million for the purpose,” he told Republica.
Apart from that, Finance Minister Bharat Mohan Adhikari in his budget statement said that the government will decide on contributions it will make and seek employers to contribute through enforcement of a separate Social Security Act. Surprisingly, he said, the act will be finalized in the next fiscal year -- 2012/13.
“This is a gross injustice. The state has forced poor workers to pay one percent SST since two years; and says it will decide on contributions from employers and government in the next fiscal year,” said Bishnu Rimal, chairman of General Federation of Nepalese Trade Union.
Even the private sector representatives flay such move of the government. “It has left all of us confused. Worse is that we fear it would deepen rift between the workers and employers,” said Pashupati Murarka, chairman of Employers´ Council at the Federation of Nepalese Chambers of Commerce and Industry (FNCCI). He urged the government to correct the mistakes soon.
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