Policy level corruption and conflicts of interests have pervaded every branch of governance in Nepal

The endorsement of the Bill relating to the Banks and Financial Institutions (known as BAFI Bill) with amendments by the parliamentary Finance Committee represents an example of the blunder committed by it earlier under pressure of certain lawmakers holding a conflict of interests on the one hand and an example of what course should be taken with regard to other issues and Bills influenced by groups with conflicts of interest.

In that sense, this course correction by the Finance Committee is welcome. Certain important points have been corrected after Parliament sent the Bill back to the Finance Committee for necessary revisions six months ago.

They include the fixing of the terms of BAFI chairpersons and the barring of people holding constitutional posts from their association with banks and financial institutions as board members or as holders of any other position.

The Finance Committee had made changes to the contents of the Bill drafted by Nepal Rastra Bank and removed any limit on the number of terms of chairpersons of BFIs (banks and financial institutions) and raised their tenure from four to five years.

The earlier draft of the Finance Committee which had revised the central bank’s original draft would have meant to harm the banking sector and public interest and would have only promoted the vested interests of a small group of people.

Parliament had sent back the Bill after sharp public criticism had greeted the Finance Committee’s revision, including from experts in the field and former governors of the central bank.

Now any BFI chairperson can hold a maximum of two terms of four years each; the lock-in period to convert promoters’ shares into public shares has been increased from seven to ten years; holders of constitutional posts have been barred from holding any position in BFI; and the allocation of a BFI’s shares to its employees has been brought back down to only 0.5 per cent of its total shares.

The latest revision has also rightly barred micro-finance companies from using the term ‘bank’ which a number of them have been using till now.

Policy level corruption and conflicts of interests have pervaded every branch of governance in Nepal, including most of those who are in authority.

In a number of cases, there are laws and regulations which forbid such corruption and practice of conflicts of interests; but in many others, there are virtually no such provisions; but in many cases the laws and regulations are not strong enough to discourage holders of positions of power from pushing issues and decisions to favour certain group(s) rather than the general public.

Parliament, for example, has the regulations to bar MPs from taking part in any discussion on issues in which their personal interests clash with their responsibilities as lawmakers.

But this regulation is bypassed from time to time, as in the case of the passing an amendment bill to Education Act not long ago. Problems also arise because the contents of the many bills are not discussed with all stakeholders.

Such conflicts of interests need to be minimized in the future, and the sections of society should raise alarm bells against any case of conflict of interest and policy level corruption.

Enforce RTI

Democracy can be consolidated and good governance and development achieved only when right to information is effectively enforced.

It is the right to information that helps ensure good governance, transparency and accountability and, ultimately helps consolidate democracy from top to bottom. The National Information Commission has stressed the need to promote right to information in all government machinery.

People have the right to know about what the government is doing for the betterment of the public.

People will be able to know about the government activities when its line ministries and agencies disseminate information through proper channels along with its websites.

All the ministries have deputed information officers to disseminate information to the public about the works carried out by them. But there is a tendency of concealing the vital information that can be useful to curb corruption.

Some information involving the national security cannot be shared with the public. But issues related to development, good governance and public concerns must be provided to the media regularly.