Print Edition - 2017-06-07 | MONEY
PAF concerned as World Bank funding nears end
The PAF has been conducting various programmes to alleviate poverty for the last one and a half decades with money provided by the World Bank
Jun 7, 2017-
The Poverty Alleviation Fund (PAF) has asked the government to clarify what is going to happen to its ongoing poverty alleviation programmes as World Bank (WB) funding for them is about to dry up. According to the PAF, the WB will stop providing soft loans for its programmes from the next fiscal year.
The PAF has been conducting various programmes to alleviate poverty for the last one and a half decades with money provided by the WB. So far, the international organisation has provided soft loans totalling Rs25.84 billion for the purpose.
During this period, the PAF has supported 1 million households, among whom 833,000 are associated with more than 32,000 community based organisations in rural areas of 58 districts. The PAF has formed a Rs15 billion revolving fund with WB aid to support poor families in rural areas.
The future of the huge investment has been put in doubt as the government has not decided what to do after the WB pulls out.
PAF Vice-Chairman Yam Bahadur Thapa said they had been seeking the government’s clear decision on how to take the ongoing programmes forward.
“We have submitted a number of options such as taking a loan from the WB or other institutions, issuing government grants or forming a poverty alleviation bank to continue the poverty alleviation programmes,” said Thapa.
The PAF has applied for government permission to borrow Rs500 million from the WB. “We have been holding talks with the international organisation in this regard,” Thapa said.
Likewise, the PAF has been considering establishing a poverty alleviation bank if the government gives the green light. According to the PAF, the proposed bank will have a paid-up capital of Rs4 billion and the PAF will put up Rs1.5 billion.
The PAF has been trying to obtain Rs2 billion from the government to keep its current programmes running. “However, the Finance Ministry has not made a decision so far.”
Only 4 percent of the total funding is being spent on operating expenses while a large amount is being used to benefit needy people, the PAF said. The fund has paid Rs2 billion to the government in taxes and interest on the loan.
The PAF said it had invested Rs25,000 per person in rural areas under its poverty alleviation programmes. According to a study conducted by the PAF, a minimum investment of Rs150,000 per household is required to reduce poverty significantly. Government data shows that 21 percent of the Nepali people are under the poverty line.
Meanwhile, the PAF has expressed discontent at the government’s recent decision to put all poverty alleviation programmes under the purview of the Ministry of Cooperatives and Poverty Alleviation.
A Cabinet meeting on Friday authorised the ministry to oversee poverty alleviation programmes. “The Poverty Alleviation Fund Act 2007 is still in place, and the government’s move has raised doubts over the effective implementation of the programmes,” Thapa said.
Published: 07-06-2017 08:32