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Fiscal fitness


MUKUL HUMAGAIN


After a four-month delay, employees at the National Sports Council (NSC) will finally receive their salaries. The NSC was in a severe financial crisis as the Finance Ministry had blocked its regular budget and it wasn't able to provide salaries to its staff. It was only after the NSC agreed to downsize that the Finance Ministry cleared its regular budget.

For employees at the NSC it has become regular to receive salaries after a delay of three or four months, particularly in the last year. The NSC, which has been forced to use its development budget to pay salaries as its regular budget was just not enough, received a further blow when the budget for the current fiscal year was announced: it was allotted a total budget of Rs 100 million, Rs 32 million less than last year. To make matters worse, the Finance Ministry directed the NSC to stop using its development budget to pay salaries.

The present crisis at the NSC goes back a long way. It has to do with corruption and nepotism that have plagued the country's top sports body, in particular the massive recruitment of staff in the last seven years. Every time a new sports minister or member-secretary came to power, their cronies were appointed to the NSC. It all began when Keshav Sthapit, the current mayor of Kathmandu, was member-secretary at the Sports Council. Four hundred new jobs were created at the Council during his tenure. This tradition continued during the tenure of Bal Bahadur KC at the sports ministry. KC, who has the distinction of being the first sports minister of the country, appointed an additional 274 staff to the Council. But the Council never thought it necessary to inform the finance ministry about the increased workforce. Until the present crisis crippled the Council, the finance ministry had been allocating the regular budget for the 370 staff that the NSC reported in 1992.

The crisis did not present itself earlier as there was enough money at the NSC from preparations for the eighth SAF Games. It also had money coming from "lotto", a lottery scheme that was started by casino magnate RD Tuttle to help the SAF games, and a 0.5 percent sales tax that was levied on goods coming into the country prior to the SAF games. Revenue from these sources provided salaries, but after the SAF Games concluded, the Council finally faced a severe financial crunch.

To increase its regular budget the NSC then began lobbying for its 1376 employees by meeting the Prime Minister, and the ministers for education, and sports. But the Finance Ministry remained firm in their demand that NSC staff be retrenched before it would clear even the Council's regular budget. When recruitments were made during Sthapit's and KC's time, the NSC said that it would provide salaries for its new recruits from its own resources. But that was just big talk. Finally, a committee comprising representatives of the NSC, the Finance Ministry and the Ministry of Education and Sports was formed to solve the matter. The NSC was advised to to cut staff. But differences remained between the NSC and the Finance Ministry over the number of staff to be retrenched.

Before Dasain, the NSC sent a proposal to the Finance Ministry stating that the number of staff would be reduced to around 1100, and sacked 158 permanent staff. In December, it fired another 100 staff of which 40 were permanent. But the Finance Ministry was not satisfied and it once again asked the Council to reduce the number to 900. The NSC is now preparing to axe another 143 staff in order to get its money. Though the NSC has been forced to obey orders from the Finance Ministry it is facing a legal challenge from retrenched employees. Those who have been axed have filed a petition challenging the decision.

The NSC, especially in the past decade, has been a victim of politicisation. Each government that came to power in the last ten years installed their people as the Council's top men. Those in charge of the NSC never tried to run the institution professionally and democratically. It was only due to pressure from the Finance Ministry that the NSC was finally forced to downsize. As Kamal Khanal, administrative chief, NSC says: "We have no option, other than to agree with the Finance Ministry."

For now, it seems that the financial crisis has passed but it is still unclear whether the Finance Ministry will increase the regular budget next year. The Finance Ministry has also stated that there are massive irregularities in the budget at the NSC. The Council's budget may not be enough to pay salaries, or promote sports, but it sure is lining some pockets.


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(11 JAN 2013 - 17 JAN 2013)


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