The Problems with Govt’s Employment Programs

the HRM 

After the Covid-19 pandemic hit the world in early 2020, Nepalis were forced to face the brunt of a deep economic slump which resulted in the closure of businesses and massive job losses. Official statistics show that more than a million Nepalis lost their jobs at home and abroad in 2020.
Realizing the urgent need of the hour, then Minister for Finance Dr Yuba Raj Khatiwada, while presenting the budget for the fiscal year 2020/21 announced an ambitious plan of creating more than 700,000 jobs through various programs.

Later, a task force formed by the government to study the impacts of Covid-19 suggested that at least 1.5 million new jobs must be created to resolve the unemployment crisis triggered by the pandemic.

Likewise, another government task force suggested creating over 2.5 million jobs in the next four-five years by restructuring and expanding various government programs like the Prime Minister’s Employment Program (PMEP). The committee formed by the Ministry of Industry, Commerce, and Supply (MoICS) had recommended expanding and restructuring the government programs focused on entrepreneurship and employment, and reviving the ‘sick’ industries that were closed in the past due to various reasons.

Meanwhile, the government is now preparing to provide jobs to 22,000 unemployed youths by providing vocational training. A working procedure for the implementation of the program has been tabled in the cabinet by MoICS. After the working procedure is endorsed by the cabinet, at least 22,000 youths will get employed in the current fiscal year. For the same, a budget of Rs 800 million has already been allocated, according to Arjun Pokharel, secretary at MoICS. According to him, the government is collaborating with several production-oriented industries to implement the program. As per the working procedure, the government would publish the names of the youths who are interested to participate in the program. Then, they will be provided training at the industries for jobs. Once the program is implemented, industries will hire the participants for at least two years at minimum wages. In turn, the industries will be entitled to receive subsidies from the government.

According to the ministry, industries also have options to hire best-performing youths after the completion of two years. “The program has been brought after requests from industries themselves. Once the program is implemented, youths get employment for at least two years. And those who are best in the job are guaranteed a long-term contract,” said Pokharel.

Earlier when Bishnu Prasad Paudel was the finance minister, he had allocated a total of Rs 1 billion for the program. The budget has been downsized to Rs 800 million by the current finance minister Janardan Sharma.

It is estimated that at least 500,000 youths enter the domestic labor market every year. However, with the lack of adequate training and skills, many are forced to opt for foreign employment even for minimum wages. According to officials, programs like these are helpful for semi and low-skilled youths. As per the ministry, the government would bear the salary of the youths for three months during training. After the period, the industry itself should bear the salaries for the next two years. And the salary should be provided as per the Labor Act.

Implementation in Question
For creating jobs, the government has been heavily dependent on PMEP, which was launched in 2019 amid much fanfare during the premiership of KP Sharma Oli.
Under the program, the government guaranteed to provide a minimum of 100 days of work for registered unemployed citizens, to address issues related to unemployment. The government has also allocated Rs 12 billion for the current fiscal year for the program.

However, the implementation of PMEP has received heavy criticism from labor experts and even from government officials. “The government had implemented such an ambitious budget just to provide employment to political party cadres. Billions of rupees are going to waste every year. What has been the contribution of the program to the overall economy? It is just spent on useless programs. It has no contribution on development–neither on country’s economy nor on skills of youths,” said a government undersecretary under the condition of anonymity.

Given the last three years of progress, PMEP has clearly failed to reach the target. In August last year, it was reported that the program, which was announced to provide employment opportunities to 200,000 people across the country for 100 days, has provided employment to just 171,000 people, and for only 71 days.
Under the program, people were even seen plucking weeds and gardening. After such reports emerged, the government was heavily criticized, but there was no change in the program.

When asked how the program will be beneficial for youths, secretary Pokharel said the proposed program would make youths skilled even if the job is not guaranteed. “The skill they get will always be beneficial in their career and to work elsewhere. So programs like these leave a positive impact.”

Too Many Programs
In the current fiscal year, the government has allocated Rs 4.34 billion for strengthening organizations providing technical, vocational, and skill training to employ 75,000 people, including those from the informal labor sector and returnee migrant workers.

Likewise, the government has also set the target of offering self-employment, farming, and business opportunities to 179,000 people through the Youth and Small Entrepreneur Self Employment Fund and various other loan schemes and programs.

Likewise, in 2016, the government launched the Prime Minister Agriculture Modernization Project (PMAMP). The program has also been criticized as the government has failed to meet the target. According to the government, a total of Rs 131 billion will be spent over the 10-year project. The project has also a high recurrent expenditure in comparison to the capital expenditure.

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