Nepali Times
Strictly Business
Losing the labour lottery


Where did Raghuji Pant, the Minister for Labour, go wrong? Only last summer he seemed convincing to many people when he announced that "no matter what" he would impose a lottery system for private-sector agencies that select and send Nepali labourers for work abroad. Pant, a UML politician and a former journalist, said that what he was planning to do was driven by his concerns for the poor.

Since the supply of Nepali labourers vastly exceeds the demand for them to work as plumbers, cooks, factory-floor workers and the like in South Korea, the Gulf countries and Malaysia, the recruitment agencies exploited the opportunity to sell the available spaces at exorbitant prices to those who could pay, thereby pushing out the poor from even gaining a foothold in the international labour market. Pant said that a lottery, conducted under the government's watch, would level the playing field in that all who qualify and participate would have an equal chance of being sent to jobs abroad without paying anything extra.

Though this columnist had his doubts about the promise of such a lottery (see 'The Luck of the Draw', Strictly Business Nepali Times #207 ), Pant's argument apparently sounded right to many people as letters of support poured onto the pages of national dailies. When Lumbini Overseas, the first target of Pant's plan, filed a case in the Supreme Court challenging the minister's decision, the judges sided with the government.

Meantime, the public's hatred for manpower agencies became starkly clear on 1 September, as hordes of young people went around Kathmandu destroying, along with Muslim-owned businesses, the offices of over 300 manpower agencies to mourn the murder of 12 Nepali labourers in Iraq. In October, the minister himself made a trip to South Korea to explain why he was doing what he was doing to the employers who, in turn, told him that they would trust their agents' judgment more than that of Pant's government.

And the result of all this is that as Lumbini Overseas prepares to send workers to South Korea in the usual way, the Minister's lottery proposal, despite the hype, has fallen by the wayside, putting him on the defensive, disappointing his supporters and denting his credibility. Looking back, he committed three mistakes.

Pant failed to understand that the best way to help the poor was not to tamper arbitrarily in the existing market but to expand employment opportunities for all. Instead of battling the politically well-placed manpower agencies in a show of ego, he could have used his time and energy to take them into confidence to spot and negotiate new opportunities in new markets for more Nepali workers.

Pant appeared to have neither done his homework nor secured any cabinet support before taking on the agencies. Using anecdotes, he only talked about high charges borne by the poor, but could supply no hard proof to the public or to a court of law to punish the offending agencies. In the end, admirable though Pant's concerns for the poor were, his inability to think through how he would push his policy (and his blaming others when it failed) raised questions about his own political judgment.

And finally, Pant could not understand that as an industry gets connected to international markets, the power to decide what Nepal should supply and how shifts from Nepalis to buyers outside who don't hesitate to drop Nepal if they don't get their way-regardless of whether they are getting garments or labourers. This is why, regardless of how extortionist the manpower agencies are and regardless of Pant's and the Supreme Court's decisions, it was the Korean buyers who made the final decision on what Lumbini should do.

(11 JAN 2013 - 17 JAN 2013)