Death and taxesThe lockdown has bankrupted businesses, and they need sensible relief packages.
Following a dip in new infections after peaking in October last year, Nepal was only starting to crawl towards recovery as businesses looked forward to making up for the unprecedented loss. There were positive indicators of a rebound earlier this year as the government launched a nationwide vaccination campaign; but as a direct consequence of lax measures to contain Covid-19, a deadlier second wave of the pandemic has now brought with it the same set of chilling challenges as stay-at-home orders are imposed or extended across the country in the wake of a record surge in cases and deaths. It’s a rerun of 2020. Only this time, the deficit of governance has been exposed to a new high as our uncertainties extend with no indication of when we will start to see the curve flatten and, with it, a gradual and safe opening of the economy.
While science-guided decisions and mandatory safety protocols are imperative to get out of the prohibitory orders when cases eventually start to dip, the government needs to urgently address the concerns of citizens, especially the most vulnerable who have again found themselves in an unfortunate situation amid stringent measures. Authorities cannot ignore the plight of the most marginalised, who, lacking work and any savings, are at the mercy of volunteers to put food in their mouths. Last year, the government announced relief programmes in kind. It provided food to the vulnerable communities; but almost a month since prohibitory orders have been in effect, the government has failed to provide any respite. The utter negligence of the state towards its citizens is unacceptable. It is the state’s responsibility to ensure that taking care of the poor is not left to private charity alone. They are only filling the vacuum that the government has created, and their resources to help those in need are not infinite.
Last year, following the four-month-long nationwide lockdown to prevent the pandemic, Nepal Rastra Bank had released some alarming figures. Tens of thousands of people had been rendered jobless, and a whopping 61 percent of businesses had shut their operations, according to the central bank’s report. The study, which covered 52 districts, showed that 22.5 percent of employees had been laid off by businesses with the largest layoffs in the hotel and restaurant sector, followed by small and medium-scale enterprises that laid off 30.5 percent of their employees. Putting numbers to despair, the study also reported that small and medium-scale enterprises were among the worst hit with 77.2 percent of the businesses even unable to pay salaries. On average, the survey revealed that businesses trimmed 18.2 percent of their payroll.
The government cannot ignore these exhaustive figures which tell us about the extent of economic distress that the citizens continue to endure. And these are limited assessments that do not give us the full picture. Various reports have also repeatedly warned that a significant number of people would slip into extreme poverty due to the pandemic. For more than a year now, a vast majority of the public has been making calculated decisions to meet their daily needs, and their savings have hit rock bottom. There is no job security, and thanks to weak implementation of labour laws, people have again found themselves in a difficult situation as the prohibitory order restricts all nonessential work. But there is no respite for the citizens save penalty waivers on loans and recovery deadlines as directed by Nepal Rastra Bank or the Supreme Court decision on Wednesday not to impose fines on taxpayers.
While these are welcome measures, they are not enough for citizens and businesses who’ve taken a massive hit in their income and revenue sources last year, and are again reeling under restrictions. The government must learn from the inadequate and impractical relief packages announced in the previous year and identify the concerns of citizens to duly address them as it prepares to present the federal budget for the next fiscal year. It needs to pursue both short- and long-term objectives to lift people and business out of this crisis. Only correct economic and social policies will lead us there and protect the fundamental rights of the people. The government must respect and protect these rights.