Sharing the Burden
By Hon. Prof. Biman Prasad - Leader of the National Federation Party.
Opinion Piece was published in the Fiji Times on:-
Saturday 2nd April 2020
As the impact of COVID-19 is felt across the economy, we must not forget the most vulnerable of our people. We need a well thought-out strategy and a funding pool to help them.
Workers and their families will be among the worst-hit, including those in travel, trade and tourism. These losses will be felt by workers in the informal sector and small to medium enterprises.
FSC workers are on four months’ leave. Many others are on reduced hours. So with both unemployment and underemployment, and with little or no support from Government, many workers and their families are struggling to make ends meet.
The Government’s only solution is the usual, easy one - open up workers’ FNPF balances so they have access to their own money.
But even that remedy is running out of steam. The Government has used it so often – and so inefficiently – that the poorest workers have no FNPF savings left.
A few weeks ago the Economy Minister (followed up by his favourite Fiji Sun journalist) tried some politics of distraction, asking what unions were doing to help workers who had lost their jobs.
Perhaps they have both forgotten that in the years of the so-called “boom” economy the Government has repeatedly bashed unions with repressive laws, arrests and intimidation.
The long-term result is that unions have been significantly weakened and unable to organise and protect their members.
This could have been a time for partnership between the government and well-organised, effective unions. But this is a government which is determined to accumulate all power to itself. If that is what it wants then, when the crunch comes, it must also take responsibility.
I had earlier suggested in a Fiji Times column that elected officials, permanent secretaries, CEOs of statutory bodies and higher-paid civil servants take a pay cut and for this money to go to a Workers Solidarity Fund.
The idea was that all workers – people on wages and salaries, including MPs – could contribute to a fund which supported less fortunate workers and their families.
But that is not what the Government did.
What did the Government do?
First, the Economy Minister announced pay 20% cuts for Government Ministers and MPs. This cut should have been higher for Government Ministers (some of whom earn more than $200,000, so they are grossly overpaid anyway). But at least it was something.
Second, the Government cut employers’ FNPF contributions from 10% to 5% and employees’ contributions from 8% to 5% (of course all the contributions are paid by the employer in the end).
So in total FNPF members now get an 10% contribution in their account, down from 18%, a 10% cut. And it does not help a worker who is laid off.
18% of zero is zero. And 10% of zero is still zero.
But there is certainly one employer which gains a huge advantage – the Government.
The Government’s own 2019-20 budget estimates put the civil service salary and wage bill at about $1.04 billion.
If you take 5% out of this, the Government has saved more than an estimated $52 million in FNPF contributions.
The Government seems to be able to afford to keep all its public servants on full pay. But it is not using its own gain from the FNPF cut to help people with no jobs.
Workers whose FNPF contributions have been cut would feel a lot better about the cuts if the savings were going towards helping fellow workers in need.
Instead the savings go to the employers. If this helps the employers to support their employees, that is good. But why isn’t the Government using its savings to help everybody else?
All over the world governments have stepped up to help workers with financial support. But the Fiji Government seems to be saying that people who do not work for the Government are somebody else’s problem.
In the middle of our worst financial crisis since Independence, with perhaps 100,000 working people in Fiji with no pay or reduced pay, the Minister of Labour this week could think of nothing to say except that pay cuts were “unacceptable”. He seems to be on a different planet!
It’s not too late
It is not too late for the Workers Solidarity Fund we have suggested. We suggest that it is overseen by a committee with Government and Opposition MPs, unionists, employers and NGOs.
We need to show the people of Fiji that their leaders are working together to solve our problems.
There is some talk now that perhaps tourism from Australia and New Zealand might be possible if we carefully control the health environment.
But this would probably mean excluding other tourists, so the tourism industry would still be operating on a smaller scale.
So we need to plan ahead. There are many months of financial distress ahead of us. And let us not forget the truth – the Fiji economy was in trouble even before the coronavirus hit.
There are other vulnerable groups in Fiji who depend on the wages of workers now suffering layoffs or pay cuts – persons with disabilities, those on social welfare, elderly, and women and children in the informal sector. Somehow we will have to find some additional cash to meet the increased need.
But food and essentials are the bottom line. The Government should be planning ahead.
If we cannot increase the meagre financial support we now give to the most vulnerable, we should at least be ensuring that food, medicines and other essentials will be available to them.
The Government has to step up and share its plans for this with the people.
This is not a normal economic slowdown. It is a major economic crash. The coronavirus is not the fault of the Government.
Time for leadership
But it is now time for the Government to respond with imagination and leadership. Mistakes or missed opportunities now will have deep social and economic consequences for the future.
Next door to us, New Zealand has applied a combination of decisive and empathetic leadership and bi-partisan political co-operation to beat the coronavirus. This has been a winning formula praised around the world.
Of course we do not have New Zealand’s money. But why can we not learn lessons from the way its leaders came together to solve the problem?
Now is the time for Government to unite every one, develop policies with proper and thorough consultation and share their plans so everyone can contribute to recovery. We can work better and more efficiently together if there is a plan.
Those hit hardest by this crisis are not somebody else’s problem. Helping them is the responsibility of all of us. But the Government must take the lead.
Professor Biman Prasad is the leader of the National Federation Party. The views expressed in this articles are not necessarily those of The Fiji Times.