17 – 23 March 2016

The issue of public sector pensions and bonuses has once again been at the centre of parliamentary discussions, as well as being a source of tensions and disagreement between the two chambers of Parliament.

Meanwhile, the Cabinet Affairs Minister has given details of Government efforts to follow up on the Financial Audit Bureau’s annual report into corruption and mismanagement of public funds. The Shura Council spent most of its weekly session discussing measures for improving the regulation of companies and entities operating in the banking sector.

Increasing public sector pensions

Al-Ayam newspaper warned this week that MPs were “triggering a firestorm” between the elected and appointed chambers of Parliament. This was after elected MPs defied the Government, the Shura Council and even their own Services Committee by overwhelmingly voting in favour of a rise in public sector retirement benefits by 7%.

Services Committee Chairman Abbas al-Madhi explained during the weekly Council of Representatives session that his Committee had recommended voting against the draft bill out of fear that ambiguities in the text could allow the Government to decrease pensions at some time in the future. However, many other MPs argued that the text was sufficiently clear for this not to be of concern.

Al-Madhi noted that this pensions bill dated back to 2007. However, the bill had been unsuccessfully put before the Shura Council six times – hence the eight-year delay.

In unusually strong comments, Parliament Deputy Chairman Ali al-Aradi described the bill as “a vivid example of levels of cooperation” between the two Parliament Chambers; adding: “The holding-up of the document for seven years in the Shura Council and the piling-up of numerous other bills without any kind of mechanism for accelerating the process is a dangerous indicator of how the Shura Council deals with bills submitted by the elected chamber”.

However, Parliament Minister Ghanim al-Buaynayn warned MPs to moderate their attacks on the Shura Council, saying: “The nature of the legislative process requires time. It is difficult to say the Shura Council has delayed draft bills; otherwise we will be seeing mutual recriminations. I love all of you and I also love the Shura MPs!”

Numerous MPs strongly criticized claims by the authorities that a pensions increase would be impossible because the social insurance fund was in deficit. Finance Committee Chairman Abdulrahman Bu-Ali said that Social Insurance Authority officials had confirmed that this was untrue and accused the Finance Ministry of “deception”. “There is a stuck record about the deficit in the Social Insurance Fund which is repeated every time we demand increases”.

Adel al-Asoumi accused segments of the media of deliberately obscuring the position of MPs and making it appear that MPs opposed increasing pensions. “The media’s targeting of this Chamber has blinded them from the truth,” he declared.

In fact, after several recent somewhat divisive parliamentary sessions featuring scuffles between the respective political blocs, there was a remarkable show of unity on display in Parliament this week over the bonus issue.

The only problem with this is that the Council of Representative’s unity pits elected MPs against the position of the Shura Council which has consistently opposed these proposals. Therefore, there is little reason to suspect that when this draft bill is re-submitted to the Shura Council over the coming weeks, the result will be any different.

MPs pensions and bonuses

Like the issue of public sector pensions; the issue of MPs pensions, wages and bonuses has been going around in circles over the past few months.

This week it was the turn of prominent MP Isa al-Kooheji to hold a public meeting discussing his controversial proposal of limiting MPs’ wages to just one hundred BD every month – instead of the current BD 2,000 wage. Al-Kooheji said that his suggestions hadn’t been designed to “provoke” MPs; rather he wanted to support the State Budget, in the current “stifling” economic conditions.

Al-Kooheji pointed out that MPs, after leaving Parliament, are entitled to 80% of their wages after eight years of service – while the average citizen can only obtain their pension after 40 years of service. Al-Kooheji explained that the average monthly salary for MPs from both houses of Parliament was BD 4,250. BD 2,000 of this was the basic wage and the remainder was various bonuses as set out by royal decree.

He argued that the problem was not the payment of salaries, but rather the substantive drain on the budget resulting from pension payments for MPs. He claimed that an outgoing MP could expect to receive BD 76,800 in pension payments, “all of which comes from the State Budget which MPs and Shura MPs claim to be responsible for protecting”. Al-Kooheji said that the fund for MPs and municipal councilors could end up facing a BD 60-70 million deficit, which would increase as more MPs and councilors retired.

Al-Kooheji acknowledged that his proposals could not affect past or current MPs, as this would violate their right to what was promised to them when they entered Parliament. However, it could apply to MPs arriving in 2018.

In fact, Al-Kooheji’s proposals are just one of a number of initiatives by MPs for reforming the system of parliamentary bonuses and pensions payments. There will need to be a lot of discussion before specific suggestions gain wider acceptance by MPs and are submitted for approval by the Shura Council and the Government.

A complicating factor is that currently MPs are only entitled to a pension after four years’ service. Many MPs who won seats in the 2011 by-election did not serve for the requisite period and therefore were unentitled to support. Many current MPs view this as unfair, given that these by-election MPs often won seats in a climate of violence and threats during the 2011 unrest.

However, the Shura Council in late November 2015 rejected proposals for changing this system; making this another significant point of disagreement between the elected and appointed chambers.

Financial mismanagement

The Cabinet Affairs Minister Mohammed al-Mutawwa this week responded to questions from MP Mohammed al-Ahmed regarding measures to rectify the issues addressed in the Financial Audit Bureau’s report on corruption and mismanagement of public funds.

Al-Mutawwa said that 48 committees of inquiry had been constituted to address allegations and shortcomings. Of the committees which had finished their work, 14 had recommended punitive measures and others had recommended revisions of administrative procedures.

The Minister also detailed a number of measures taken in response to the report’s recommendations. These include stricter procedures for tendering processes and more proactive monitoring processes within government departments.

He noted that comprehensive procedures had been put in place for electronically documenting the follow-up of all the recommendations made by the Financial Audit Bureau Report.

Politics in brief

Shura Council session: Agreement on new regulations for banks for increasing accountability of entities operating in the banking sector; regulating information related to creditors and borrowers; and protecting privacy of data. Ratification of dual-taxation agreement with Portugal.

Weekly Cabinet session: Plan to relocate garages and workshops outside residential areas. PM directive to study the challenges facing Nuwaidrat central market and establish what is required to re-open the market as soon as possible. Instructions to extend sewage system to new housing areas in Bu Quwwah, Jebel Habsha and North Sehla villages. Cabinet stresses importance of close regional cooperation for confronting security challenges.

Weekly Council of Representatives session: MPs vote for 7% increase on public sector pensions. MPs agree that parliament administration officials be appointed by royal decree, not the parliament chairman to avoid politicization of appointments. Municipalities Minister pledges to address the issue of imported meat standards and promises that MPs will not have to concern themselves with these problems again. MPs complain to Health Minister about shortcomings in services.



Week in politics

Continued reform efforts:5 – 11 May 2016

Social media attacks: 20-27 April 2016

Shura Council rejects “Islamicization”: 7-13 April 2016

CEDAW victory: 31 March – 6 April 2016

MPs reject budget statement: 24 – 30 March 2016

Pensions dispute: 17 – 23 March 2016

Committees of inquiry: 10 – 16 March 2016

Protection for Shia families: 3 – 9 March 2016

Political societies in decline: 25 Feb – 2 Mar

Lebanon travel restrictions: 19-24 Feb

Constitution celebrations: 11-18 Feb

Russia State visit: 4-10 Feb

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