In the last two months, its estimated that nearly 20,000 people have lost their jobs to either redundancy, no pay leaves or salary cuts. The main focus of COVID-19 stimulus packages should be to take care of workers. The biggest misstep will be allocating so much of the aid to financial rescues of large firms with insufficient conditions to ensure that jobs and wages of workers were saved.
How policymakers respond now will determine the level of pain working families experience and the speed at which the economy can get back on track after the shutdown period is over. The relief and recovery packages passed since the crisis began included many good measures, but how many steps are taken to protect the workers?
Policymakers approved over MVR 2.5 billion in direct financial aid to this effort, with more potentially forthcoming in subsidized loans from the government via Bank of Maldives and SDFC. Yet there are questions over how this will protect the workers, even though it stipulates that loan is provided on the condition that no local should be terminated from their job.
The question arises as to why a business would take a loan with interest to repay its employees’ salaries when unemployment benefits can do the same without any cost to the employers.
Small businesses are a bedrock of the Maldivian community, employing our friends, neighbours. They aren’t just companies, they are cornerstones of our communities. With COVID-19, small businesses are being forced to make difficult decisions about how to keep their businesses afloat, their staff employed, and their rents. The stimulus package should focus on keeping Maldivians in jobs and support those out of work.
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