One-fourth of poorest receive govt relief

Staff Correspondent: Only one-fourth of the country’s poorest quartile group had received assistance from government announced relief programmes for Covid-19 pandemic, according to a recent study.
In addition, relief allocations were made based on population size rather than the poverty rate scenario.
The aforementioned data was included in the study on the social protection budget jointly conducted by Center for Policy Dialogue (CPD) and Oxfam with support from European Union.
According to the findings, 19.6% of the poorest rural population and 43.3% of the poorest urban population had received either rice or cash as government relief or Tk2,500 financial assistance to their MFS accounts.
However, the presence of exclusion error was evident among the beneficiary selection process since a large number of workers in the informal sector and the new poor had remained outside the programmes.
The survey for the study was conducted on 2600 households across 16 districts between late January and early February 2021.
Among the respondents of those households, whose income had reduced because of the pandemic, 77.3% did not receive any social safety protection support.
Meanwhile, over 90% of the rice or cash receivers had to bear travelling costs to reach distant relief centres. Even 17% of the people who received Tk2,500 support had to bear such costs too. Among the beneficiaries, 59.3% (rice), 57.7% (cash) and 48.9% (Tk2,500 cash support programme) were not aware of the eligibility criteria for inclusion. Only 1.6% of relief beneficiaries were aware of the hotline numbers, said the study findings.

Majority of the beneficiaries (85.1%) were not aware of any grievance redress system in connection with the three assistance programmes.

The study data also highlighted that absence of a central database with spatially disaggregated data, for distributing relief packages was greatly felt.

At the study launch event, Shams Mahmud, former president of the Dhaka Chamber of Commerce & Industry (DCCI), said that the SMEs did not get the support of the incentive package announced by the government.

He also highlighted the adversities of seeking government incentivised loan procedures.

“My business has a turnover of $100 million. I have received the export trophy from the Prime Minister four times. When I went to the bank for the incentive package I was denied because I am not an exporter!” he said.

He expressed concerns over the availability of loans for SME businesses.

However, he praised the tax holiday given for the light engineering and automobile sector in this year’s budget. “The government also has a plan to increase investment in economic zones. But we don’t see SME linkage policy here,” he added.

“We are talking about export diversification and reducing dependence on RMG. Therefore, SME linkage policy is urgent,” said Shams.

He further noted that the investment rate in the private sector is still not growing despite lower bank interest.

“The growth rate of the private sector has been low in the last four-five years. We were told then this is due to the high bank interest rate. Despite lowering bank interest rates last year, investment is not growing significantly,” he said.

Shams Mahmud said limitations in budget policy and the government’s investment policy is responsible for this.