Budget 2007-08 : The poor remain ignored

The Finance Minister and the chief architect of many budgets in Nepal’s history, Dr Ram Saran Mahat, seems to have perfected the art of budget making that promises everything to everybody — to industrialists and businessmen in particular, besides fellow politicians, civil society lobbyists, and other interest groups. And while he also garnishes his speeches with dollops of such contemporary catchwords like peace-building, inclusive society and poverty reduction, the poor remain consistently ignored. Historically, poverty has remained the mother of all problems in Nepal, but the minister has once again let down the country by refusing to take on the issue headlong.

Dr Mahat’s distaste for the poor has a historical antecedent. The first post-1990 budget, basically authored by him, had provided that “the absolute poor will be identified and priority will be given to them for employment in government-run projects.” In operational terms, it meant job priority for the poorest, emphasis on labour-intensive infrastructure projects, equitable distribution of such projects across various regions, and more money in the pockets of the poor, the last provision triggering other socio-economic development activities in communities. But the provision that promised so much was never implemented. Interestingly, pretty much the same ideas were mooted earlier by the Marich Man Singh cabinet in the dying days of the Panchayat regime. It was astounding that such a major lapse on the part of the ruling party did not seem to bother the CPN-UML, then the main opposition.

The finance minister claims that the present budget is the outcome of the eight party consensus which also includes the Maoists. Obviously it did not occur to these “people’s warriors” that the budget offered a major opportunity for them to do a good turn to the hapless people. In sum, even the historic movements of Jana Andolan I and II have not helped improve the plight of the poor, who continue to be cold-shouldered by the powers that be. Social Democrats, Marxist-Leninists, even the Maoists, have been indifferent to the dismal condition of the poor.

While writing the new budget three specific questions should have been of paramount concern for the drafters, particularly at this crucial juncture in Nepal’s troubled history. Firstly, how do we take the money to the poor who need them the most? Secondly, is the allocated sum enough given the abysmal level of deprivation in the country? And thirdly, how can the poor people be trained to generate their own resources in order to lift themselves out of poverty quickly and sustainably? Sadly, the budget is not explicit on all three counts.

The planners have been bragging about the decrease in rate of poverty from 42%

in 1996 to 31% in 2003/04, as if this was the result of their wise plans and policies in

the past. It is widely known that the drop was chiefly driven by remittances. It should also be kept in mind that the ones who left the country were those who had money to pay for their travel.

Those left behind were the hardcore poor; they had little land to till in this land-deficient country and no skills to engage themselves in non-agricultural occupations. It is no surprise then that while 78% people are employed in agriculture sector, their contribution to GDP has been half that proportion.

Most of the past policy prescriptions have been limited to paper. Getting the government to adopt them would have involved committed and sustained advocacy. At its face, this should have been easy as the Planning Commission is chaired by the PM himself. But the planners would rather spend their time gracing the opening and closing ceremonies of useless ventures, going on foreign junkets, or enjoying cocktail circuits.

Whereas the politicians and planners have been indifferent to the plight of the poor, the bureaucrats have been making merry as well. In Nepal, due to years of tireless work of NGOs, rural areas are dotted with saving and credit organisations and full-fledged cooperatives. The Small Farmer Cooperative Limited (SFCL) has been particularly innovative in accelerating poverty reduction, even among the landless communities. But the government department dealing with cooperatives has been totally uncooperative in strengthening them.

Therefore, for the right implementation of their customary pro-poor rhetoric, the finance minister and the planners have to come out of their cocoons and take special measure to help these small institutions. For their part, the Maoists must reincarnate themselves from being “people’s warriors” to becoming genuine helpers of the people.

The finance minister surely knows about the causal relationship between empowerment of forest users and the success of forestry sector. It is time to replicate this success in the field of poverty eradication.

Shrestha is a development anthropologist