KATHMANDU, Sept 9: Finance Minister Surendra Pandey has said the government is committed in bringing a guideline to limit perks and benefits that the Chief Executive Officers (CEOs) of financial institutions are enjoying.
Answering queries raised at a meeting of Finance and Labor Committee of the parliament on Tuesday, Finance Minister Pandey said the government had agreed in principal that there must a system to review the paycheck that the CEOs are being offered.
"We have already taken the issue seriously and a high-level committee to oversee financial sector reform in Nepal has already urged Nepal Rastra Bank to come up with a policy that will put a cap on the perks and benefits for the CEOs," Pandey said.
Following the global financial crisis and ongoing debate about the pay to executives of banks worldwide, a policy to address possible crisis has become necessary, Pandey said.
The finance minister assured lawmakers that the government was closely watching possible impacts of global financial crisis to domestic economy and added that additional instruments have been put in place to monitor financial health of the banks.
"Along with the financial crisis, soaring international oil price, which can generate huge losses and disturb fiscal balance, is another major concern for the government," he said.
He also said the ongoing practices of enjoying bonus based on the profits made on a specific financial year despite huge accumulated loss must be discouraged. "There is a need of consensus among political parties and stakeholders to address the problem that has encouraged the financially sick institutions to show profits by hook or crook," he said.
The finance minister also expressed concern over the growing financial indiscipline in the public enterprises of first enjoying bonus and pressing Ministry of Finance for additional budget to finance regular expenses like monthly salary.
Former finance minister and lawmaker Dr Ram Sharan Mahat expressed concern over the growing practices of adopting capital intensive production techniques due to the prolonging labor problem. "It is disturbing that the employment opportunity is not expanding despite a moderate growth in the economy,” he added. Parliamentarian Dr Hari Roka urged the government to urgently review the perks and benefits being awarded to CEOs of public banks and bring a policy to regulate the practice.
Another lawmaker Diwakar Golcha said rising trade dependency with foreign countries is one of the reasons behind rising inflation rate in domestic economy. "Shrinking domestic agricultural production is fueling inflation," he said and added that inflation would further accelerate in days to come if deep-rooted problems of agriculture sector are not addressed.
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