The Bhutanese Leading the way.
The Head of the Legislative Committee and Nyisho-Sephu MP, Kunga, in a National Assembly Press Conference said that after elections, when a Cabinet Minister joins office ,the minister gets Nu 600,000 as an office joining amount and the Prime Minister gets Nu 1.2 million (mn).
He said that this amount is not reflected in the Pay Structure Reform Act of Bhutan 2022 and Pay Revision Act of Bhutan 2023, but instead the amount is being given on the orders of the Finance Secretary. He said such amounts should actually be approved by the National Assembly, and others do not have a right to approve such amounts.
The MP was responding to the advice of the OAG that said the Amendment of the Pay Structure Reform Act 2022, as moved in a motion by the NA, is illegal and unconstitutional, as such changes to pay and benefits have to come via a Pay Commission.
The major allegation brought forth by the Nyisho-Sephu MP against the Cabinet Ministers and the Prime Minister (PM) has many people asking how such amounts are given for joining office. Therefore, The Bhutanese has decided to find out.
Amounts are Agency Budget
The MP is right in saying that the above amounts of Nu 600,000 and Nu 1.2 mn are kept for the joining of the minister and the PM respectively, however, they are not given as allowances or pay to the ministers and the PM.
A government official, on the condition of anonymity, said the amounts are there in the budgets already approved by the Parliament and are treated as part of the budgetary expense of the agency.
In short, the money cannot go into the personal account of the minister or PM and what is not spent by the agency reverts back to the budget.
The money is spent exclusively for the Zhudrey and Dha ceremonies where hundreds and thousands of people turn up with Khadars and where they are given tea, snacks and meals apart from other expenses of the day.
The official said that the budget is higher in case of PM, as thousands of people come to offer Khadar from the day time till late night, and all of them need to be given tea and even food which is prepared from this budget.
The budget head of Nu 600,000 and Nu 1.2 mn were actually set as ceilings from January 2024 onwards, and anything spent above this has to be borne personally by the ministers and PM. In the past, there were instances where ministries with more resources spent even above this, and so this cap was put.
Caps on ICT equipment, vehicles and furnishing
The Ministry of Finance in January 2024 not only issued the above cap, but also several others that limited the various other facilities like ICT equipment and vehicles.
This was issued as the ‘Guidelines on Allotment of ICT Equipment, Vehicles and Joining Ceremony Expenses for PM, Cabinet Ministers and Equivalent Position Holders’.
Before this, ministers had developed the trend of not only keeping their Duty Prado car, but also the better-quality pool vehicles from the ministry as their back up vehicles in the ministers’ residences.
The guideline states that ministers can only keep one Prado vehicle on duty, and apart from that, if they go for official travel, they can use one additional vehicle from the pool vehicle as a back up. The same condition applies to PM, except that he is entitled to an additional SUV electric car.
When it comes to ICT equipment, in the past, there were no limits on high end expensive devices for the ministers and PM.
The guideline now limits this with specifications. Ministers are now limited to getting a 256 GB iPad, 512 GB MacBook Pro, one desktop, one black and white printer and one fixed line phone.
Even when it comes to the furnishing of the minister’s offices, the furniture and furnishing can only be replaced on completing the life cycle of the furniture.
The guidelines also strictly lay out that things which cannot be bought by the office for the ministry are iPhones, iPods, luxury and antique or custom built Chhoeshams, statues or Thangkas, electronic books, artwork, home theater sound system, camping equipment, beds, power tools, steam irons, luggage, customized assets and special-order desk blotters and other accessories.
The Lhengye Dhensa furniture are also strictly listed to 55 items, like cupboard, desk, dining table, mirror etc.
The guidelines says that all of the above are property of the RGoB, and must be maintained in the inventory. The ministers can take ownership of the iPad and laptops, but they will have to pay the depreciated rate and they cannot buy the printer, desktop, and fixed phone.
Executives joining amount
The joining expense is not limited to just ministers, but there is a list for Executives too, but here again, it is as a cap.
The amount is Nu 150,000 for the Cabinet Secretary, Heads of Constitutional Bodies, Attorney General, Government Secretaries, Justices of Supreme Court and High Court, Chairperson of Privy Council, Vice Chancellor of RUB and President of KGUSMB.
It is Nu 100,000 for Commission Secretaries, NA and NC Secretary General, Commissioners, President of NMS, DG, Dzongda, Thrompon, Executive Secretary, Director, Registrar General of Supreme and High Court, Drangpon and Dean JSWSL.
The above amounts are also part of budgetary expenses.
The official explained that this budget head was there for ministers from long before, whereas, there was no such budget listed for MPs.
What Public Finance Act says
On MP Kunga’s allegation that the joining amount for ministers was not in any Act and was approved by the Finance Secretary, the allegation does not apply, as this is not Pay or Entitlements taken by ministers but part of the larger agency budget in the Annual Budget.
The Public Finance Act section 24 (a) says, “The Ministry of Finance shall have the powers necessary to fulfill its responsibilities under this Act. Such Powers shall include issuing the Financial Rules and Regulations and such other rules, manuals, directives, decrees, instructions or notifications according to the powers in this Act and amending or cancelling them. Such powers shall be exercised only if consistent with the responsibilities of the Minister of Finance and the Ministry of Finance under this Act.”
On the Secretary part, the same Act under section 26 says, “The responsibilities and powers of the Ministry of Finance shall be exercised by the Secretary of the Ministry of Finance.”
What MPs want
The MPs under the Parliamentary Entitlement Act Amendment Bill 2024 want a similar joining expense as above, but in their case, they want it as a lumpsum amount or actual cash, which is not taken by any of the Ministers and Executives.
The MPs currently get a laptop and iPad each, even if they are older models, but they instead want a one-time lump sum amount as equipment allowance. Here again, Ministers do not get such an amount, but their equipment is purchased by the agencies through procurement.
In what could be the fairest demand of the NA MPs in the Parliamentary Entitlement Act Amendment Bill 2024, they want a well-furnished independent chamber. Currently two NA MPs share one office each while NC MPs have their own offices.
Here, the official said that in modern times, people even have cubicle offices but this demand of the NA MPs could be resolved, as it may entail renting a private building to give their own office spaces. The 13th Five-Year-Plan has no provision to construct office space for NA MPs.
However, MPs do get a Research Officer each.
When it comes to vehicles, the MPs want either a duty vehicle of 2800 cc to 3000 cc or a rationalized lump sum grant with tax exemption for a 2800 cc to 3000 cc vehicle.
There was anger among incoming MPs that while the previous Parliament MPs took their quotas, they had legislated changes denying future MPs.
The NA MPs had initially tried to get Nu 2.5 million (mn) as a lump sum instead of Nu 1 mn for giving up the quota, but the Finance Ministry did not agree, pointing out that a Pay Commission would have to be instituted for this.
When the amount was not given, the MPs insisted the Pay Structure Reform Act of Bhutan 2022 and Pay Revision Act of Bhutan 2023 had failed to repeal the Parliamentary Entitlement Act where the tax exemption still stood.
The official said the MPs have a point in saying that the government has been unable to rationalize and get rid of duty vehicles for Executives, but here, the official said while the government is limiting the purchase of new vehicles, it cannot fire the current drivers and get rid of the current vehicles.
The government is reluctant to have duty vehicles for MPs because it was firstly, they who demanded 2800 cc to 3000 cc duty vehicles which is a Fortuner or Prado, which will cost a lot and the cost of a government driver salary will also be high.
The official said some argue that such duty vehicles should be bought so that it can be given to future MPs, but the official said the vehicles will not even last, given the collusion between drivers and workshops and fuel pumps.
The official said that the 50% raise given effective from July 2023 as part of the clean wage was to have a better and more transparent system, and a sounder footing but that message seems to be lost.
According to the official, the MPs, while demanding the same facilities as Ministers and Executives, are not realizing that the nature of the work is very different, as Ministers and Executives have daily administrative operations and wide scopes of duty, and engage mainly in public service delivery.
Borrow money to buy duty vehicles
The official said that if vehicles for MPs have to be bought then the country will have to borrow money or seek grant.
The 2024-25 Budget has shortfall of Nu 15.972 billion, which means a fiscal deficit of 5.2% of GDP.
The government is currently issuing T-Bills to borrow money from the market to help pay salaries and meet other expenses, as part of the cash flow management since revenue comes in at only certain times of the year, like tax collection and hydro revenue.
In fact, Bhutan does not have revenue to even finance the 50% pay hike since July 2023 and is selling its assets of Bitcoins to finance a large chunk of it (see story on pg. 1).
Cabinet silent
Meanwhile, the position of the Cabinet is not to discuss on the issue anymore, and so despite the fiery press conference of the NA MPs on Wednesday, the issue of entitlements issue did not feature in the Thursday Cabinet meeting.
