Fiscal measures hardly linked to job creation

The proposed budget has failed to offer fiscal measures to create jobs crucial to millions of the people in the informal sector who slipped to poverty because of the coronavirus pandemic, said experts yesterday. 

"Fiscal incentives proposed in the budget are not sufficiently linked to employment generation, particularly for the traditionally left-behind groups," said Debapriya Bhattacharya, convener of the Citizen's Platform for SDGs, Bangladesh.

The government has provided tax holidays and incentives to many sectors in the budget for the next fiscal year.  "But, there is no mention of how many wage employments these measures will create," he said.

The economist spoke while presenting a paper styled "National Budget 2021-22: What is there for the disadvantaged people" at a virtual media briefing organised by the platform, which comprises more than 100 non-state actors and their networks and associates.

Bhattacharya said the finance minister's budget speech focused on traditional skills development to increase the employability of the youth and encourage self-employment and overseas jobs.

"But there is no structured outline of how these jobs will be generated."

The budget speech claimed that one million jobs had been created in the information technology sector for the youth, and another one million were to be employed in 2021, he said.

"No source was cited, and no timeframe was mentioned," Bhattacharya said. 

There should be actions to identify how fiscal measures are to be linked to job retention and generation and the possible composition of the future additional employment.

"But, there has been no Labour Force Survey since 2016-17. How will the employment situation be monitored? This is a kind of information anarchy," he said.

According to the economist, the budget proposal ignored the new poor created by the pandemic-induced economic slump and offered no measures for the informal sector, the prime victim of lockdowns. "There is nothing for the new poor in the budget," he said.

More than one year has passed since the pandemic, but the government said it had no official estimate on the number of people who fell below the poverty line. 

There should have been a multi-year rational, coherent and inclusive budget to achieve faster and inclusive recovery, he said.

"But they did not do it. It is the shallowness of their thinking, the tendency of avoiding risks and attitude of denial."

The second wave was not considered in the preparation of the budgetary numbers. So, all projections for the next fiscal year were on the higher side, he added.

Mustafizur Rahman, a member of the core group of the platform, said many people fell into poverty in urban and peri-urban areas. Many shifted from the services sector to agriculture, and their income declined and they became poor.

"If we can transfer cash to them, it will create demand in the SME sector and generate jobs. The cash transfer should be repeated."

Sultana Kamal, also a core group member, said there was a lack of transparency in the proposed budget.

"If we always show the glamour and deny the weakness, it is not a good sign."

Mushtaque Raza Chowdhury, the vice-chairperson of Brac, thanked the finance minister for value-added tax exemption on sanitary napkin production, duty waiver on raw materials for cancer drugs and on latrine pan used in villages, and the VAT exemption for autism-related services.

"But it is hard to find in the budget proposal anything that is aimed at reducing the basic problems in the health sector."

The policymakers seemed to have failed to understand that the pandemic comes with waves after waves, he said.

"There was nothing in the finance minister's speech on how the country will counter the second wave and other future waves."

Rasheda K Choudhury, another member of the core group of the platform, said they had not expected any surprises from the finance minister for the development of the education sector in the budget.

"We had just wanted guidance, investment and measures to overcome the crisis in the education sector. But nothing was found in his speech."

"Because of Covid-19, which forced the closure of educational institutions, a generation is being destroyed. There is nothing in the budget for four crore students and 13 lakh teachers."

Inequality is being created in the education sector, according to the former caretaker government adviser.

"The children of the rich families can access education with digital devices whereas the children of poor people cannot."

About 60 per cent of students lacked access to online education, but no steps were taken to overcome it, said Shaheen Anam, executive director of Manusher Jonno Foundation.

"The current condition of the education sector will create a terrible scenario in the education sector in the future."

Child marriage has increased significantly due to the closure of schools and colleges, she said.

"We are not focusing on the mental state of the kids confined to homes."

The budget allocated Tk 2,023 crore to 17 lakh disabled people, she said.

"But if we count it in the most conservative way, there are 1.5 crore disabled people in the country. What will happen to them?"