By L.E. Pep
The local Government bill will be amended to reschedule the village elections for 2020. As announced previously by the PM in the National Assembly, the district councils and the rural population were getting ready for the elections. But the so-called La Cuisine decided otherwise… The political parties are strongly objecting and social media is abuzz with quite a lot of Mauritians criticizing the decision.
The objectors are airing strong suspicion that the postponement of the elections is mainly the result of the regime buying time, fearing a clean sweep by the opposition party if it were held now. Buoyed by its convincing win at the Quatre Bornes by-election, the latter has the wind in its sails and it will need more than such manoeuvres by the so-called La Cuisine to stop it.
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Portable Retirement Gratuity Fund: Divergent views
The introduction of this fund has been long awaited by private employees. It is a welcome move as it will allow a private sector employee to accumulate his or her time of service and gratuities in the event of resignation, change of employment or dismissal. However, both the trade unions and the employers have reservations on the rate of 4.8% of the monthly remuneration that the employer will have to contribute upfront replacing the previous payment representing the 15-day remuneration per year of service for the calculation of gratuity.
The Portable Retirement Gratuity Fund will have the merit of encouraging mobility of the workforce. And those firms that will be paying the 4.8% rate or above will be able to retain their performing workers. Besides other issues like the recycling fee which the employer is now exempt from paying, unions want a higher contribution rate from the employers whereas the latter are worried that it will escalate their cost of production especially for small operators.
It will be interesting to follow up how Government will tackle these issues. These are the kinds of reforms that make a real difference to our ways of doing business.
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Another Fact Finding Committee: this time the SIFB
The Sugar Insurance Fund Board, an institution falling under the Ministry of Finance, was, till recently, being exhibited by the regime as an exemplary “foolproof” institution working in the interest of planters. It seemed that it has also fallen prey to the habit of creative accounting, depriving some 10,000 planters of their due compensation payments up to an amount of Rs 450 million. It was bad publicity for government, and the fudging of the Minister of Agriculture calling it an “omission” did not help either.
Now to make matters worse, Government has set up a Fact Finding Committee (FFC) to look into SIFB’s alleged cooking of the books. We have had such FFCs in the past – the one on Trust Fund for Specialised Medical Care chaired by our dear Vijaya Sumputh – which mainly looked at the facts and figures, made some recommendations and proposed some remedial actions which would have created too many problems if implemented.
So most of these FFCs finally ended up gathering dust in drawers. As demanded by the opposition, we need a full-fledged commission of enquiry with full powers to probe our SIFB – an institution “par excellence” falling from the pedestal they had hoisted it up.
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When our version of the “Gilets Jaunes”?
As a formidable example of an apolitical social mobilization, without the lumpen elements, it is one. We should be inspired by the movement which is protesting against the increase in fuel prices and eroding purchasing power of the middle class and more broadly a sense of general disgust with the ruling elite.
We have every reason to have our own “Gilets Jaunes”. Is it justified to have taxes and charges comprising more than half the cost of fuel? And this money is being spent on recurrent expenditure. This is irresponsible! Gasoline prices around the world show that our fuel prices are much higher than many of our competitive textile producers, namely Indonesia, India, Turkey, Bangladesh, Malaysia, South Africa, Sri Lanka, Philippines, Kenya, Thailand, Morocco, China, and Madagascar.
Petroleum taxes are really just like another VAT that adversely affects the middle class and the poor. It increases the regressivity of our already unfair tax system impacting far more heavily on both the middle class and the poor. The tax money is not being used for the welfare of the population but to develop a model of development of smart cities, real estates and gated communities designed by an elite for the wealthy while the majority of the population are banished to the ghettoes of the smart cities. But they will have the luxury of watching the metro passing by without having the means of affording a ride.
En marche, les gilets jaunes mauriciens !!!
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Another blunder by the MBC
Whether it is the earlier acting director or the new one or the chairman of the MBC, they have a tendency to surprise us with their incongruous statements. The latest one was about our meagre subscription fee. “Abroad for example there are subscriptions of 10$ or 30$ per person; here we have a fee of Rs150 which is not sufficient.” But abroad, Sir, there is a greater range of variety and program content and it seems that its viewers can’t get enough of a good thing. There is so much competition and ratings for each programme that it is a daily fight for survival.
Even at Rs 150, the few viewers who have no choice but to watch the MBC find that there are not getting value for money and they are mostly disgusted with the whiff of obsequiousness and servility that oozes from certain local programmes. Sometimes it is painful to watch, like the debate that took place last week between the Attorney General and some selected journalists. Abroad, Sir, he would have been on a hot seat, really grilled and it would attracted a keen viewership.
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Prestige projects and Mauritius shining !!!
It is not projects like the Metro Express and the Cote d’Or complex that will propel Mauritius into the league of high income economies. Nor will these be the perfect exhibits to sway opinions in favour of the present government. The BJP in 2004 general elections had also banked on the blitz of “India Shining” and its lopsided focus on the urban growth story and economic optimism while neglecting the distress and backwardness of the rural landscape. It turned out that “India Shining” is often dubbed as one of the biggest reasons for the BJP’s government’s failure to return to power at the Centre.
The prestige projects as exhibits of a Mauritius shining are likely to have the same effects as in India because voters are more bothered about issues that affect them directly in their daily lives – purchasing power, corruption, relative poverty, governance issues, cronyism… Indeed, increasing fuel taxes, state capture, jackpots for cronies – the earlier Rs 40 million compensation and now Rs 100 million for the paedophilia case – are the determining factors that will influence voters in the forthcoming polls.
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BOM: Conflicting statements
The Governor of the Bank of Mauritius (BOM) at the Annual Dinner with major economic stakeholders stressed the fact that the banks were keeping Rs 4-6 billion excess balances and that it was held voluntarily as a precaution. If banks are keeping excess liquidity, it means that demand is not that buoyant or there are expectations of higher risks. Both are in contradiction with BOM’s forecasts of the economy. The BOM on the contrary believes that domestic demand will remain the key driver of real GDP growth and that economic activity remains commendable – not in line with the latest issue of Monthly Statistical Bulletin which confirms the continuing fall in the growth in bank credit.
Equally puzzling was the request to banks to raise interest rates when the MPC has persisted in keeping the repo rate low resulting in unbelievably low savings rates. And the one requesting banks to ensure that they take all precautions to keep our jurisdiction clean was like shooting oneself in the foot as it was its sister-organisation the FSC which without any inhibitions opened the floodgates for Alvaro Sobrinho’s billions.
* Published in print edition on 30 November 2018