2019 Roundup: Govít Seizes 230 Million Dinar from Unemployment Fund to Finance Voluntary Retirement

2020-01-06 - 6:45 am

Bahrain Mirror (2019 Roundup): On March 11, 2019, the government urgently made amendments to the Unemployment Insurance Law, which included raising the unemployment allowance to 200 dinars for academics and 150 dinars for others, noting that the allowance would continue for 9 months. However, the amendments represented a form of blackmailing of MPs, as one of the articles included transferring part of the account's money to finance voluntary retirement.

The amendments sparked widespread public uproar, and the General Union of Bahrain Trade Unions called on the House of Representatives to reject the amendments, which are considered "an infringement on the Unemployment fund". But as expected, the Parliamentary Services Committee approved on March 17, 2019 the amendments allowing the deduction of 230 million dinars from the fund in order to finance voluntary retirement and its expenses.

On March 18, 2019, MP Ibrahim Al-Nafei revealed that the government did not give the MPs any guarantees that other amounts would not be taken from the fund in the future, yet the House of Representatives passed the amendments in its session on March 19, 2019.

Al-Nafei proposed during the session to withdraw the amendment allowing the financing of voluntary retirement from the Unemployment fund, but only 13 MPs voted in favor of Al-Nafei's proposal: Abdullah Al-Dosari, Mohammad Bou Hammoud, Youssef Al-Dhawadi, Isa Al-Qadi, Mohammad Al-Abbasi, Sayed Falah Hashem, Khalid Bou Onk, Ammar Abbas, Kaltham Al-Hayeki, Mamdouh Al-Saleh, Bassem Al-Maliki, and Abdulnabi Salman.

The amendments were referred after approval by the House of Representatives to the Shura Council, where they were proposed to the appointed chamber on March 24, 2019. The law was passed with the approval of the majority, and with the rejection of Jamal Fakhro and Abdulaziz Ebel and the abstention of Jamila Al-Salman.

Despite the apparent complexities facing the Government, the process seemed more like formal routines that did not cause any problems, and went smoothly, even recklessly.

In early November 2019, local Al-Bilad newspaper reported that the administration of the General Authority for Social Insurance, which is responsible for managing the Unemployment Fund, did not convene to approve the transfer of 230 million dinars from the Unemployment Fund to the public sector fund in the authority, noting that it happened by email, and that not all board members agreed on the decision.

The head of the Civil Service Bureau, Ahmed Al-Zayed, says that the fund's annual revenue is 82 million, while the unemployed allowance is only 8 million, which means that the surplus is 74 million dinars a year.

He added in a comment he gave in the Shura Council during the discussion of the amendments on March 24, 2019 that the 230 million dinars deducted by the government from the fund will be compensated within 3 years from the surpluses of the Unemployment Fund itself. He also said that the government is responsible for 67% of the fund budget, which indicates the government's lack of intention to pay this money that was illegally seized.

Arabic Version