Govt mulls forming labour bank
KATHMANDU:
The government is gearing up to establish a labour bank with paid-up capital of at least Rs five billion to properly link remittance with national productivity and to provide easy banking service to workers.
If things go smoothly, the bank will come into operation within this year.
Giving priority to the labour bank plan, the budget announced on Sunday has talked of conducting study to open the bank with investment from employers’ organisations, workers and the government. The institution is envisaged mainly for facilitating banking services, to channelise remittance resources and carrying out welfare activities focusing on aspirants leaving the country for foreign employment and workers in formal and informal sector of the domestic labour market.
On Monday, a board meeting of the Foreign Employment Promotion Board (FEPB) also decided to expedite the process of setting up the bank. “The meeting has directed a committee formed under FEPB to speed up the preparations and fix legal provisions,” said Raghu Raj Kafle, executive director of FEPB. According to him, the bank will come into operation within the first trimester of next fiscal year, if preparatory works move positively.
The committee, formed under economic expert Ramesh Koirala, includes President of Nepal Association of Foreign Employment Agencies Hansa Raj Wagle, Director General of Labour Department Rabindra Mohan Bhattarai, Director of Nepal Rastra Bank Bhishma Dhungana and Kafle as member secretary. FEPB officials said that they will not compromise on the main agendas of the planned bank and would rather work on formulating new laws to open the bank, if necessary.
The main focus will be to set up and run the bank under the Bank and Financial Institutions Act 2006. After the operation of the bank,
apart from the basic banking facilities, the workers will also be able to get loan at cheaper interest rate to go for employment abroad or for business ventures within home country.
As per the preliminary plan, the bank will also garner investment from National Welfare Fund and Social Security Fund. Discussion is underway to fix paid-up capital at Rs five billion with authorised capital of Rs 10 billion. In total, the government is likely to have 50 per cent stake in the bank, as per the FEPB.
Compensation to be doubled
During the Monday’s meeting, the board members of Foreign Employment Promotion Board (FEPB) agreed in principle to double the compensation amount being provided to the families of migrant workers who die or get injured abroad.
“There has been a decision to double the compensation; however it will be implemented only after needful amendments are made to the Foreign Employment Regulations,” said Raghu Raj Kafle, executive director of FEPB.
As per the existing provision, families of each deceased migrant worker get Rs 150,000. Similarly, maximum of Rs 150,000 in compensation is provided to injured workers. The compensation is currently being extended from Foreign Employment Welfare Fund’s reserve of Rs 2.5 billion, according to FEPB.
Likewise the meeting has decided to provide scholarships to children of workers losing their lives abroad. To this regard, FEPB will use the resources of the fund and collaborate with Ministry of Education.
Source: THT
