A landmark vote yesterday (March 6) saw Bahrain’s parliament veto a Royal decree that would increase the government's share from 20 per cent to 50 per cent in the revenues of Tamkeen, the country’s labour fund.

The government wants to tap into Tamkeen's cash reserves, which are intended to support Bahraini businesses and train the local workforce, to fund public sector pay rises announced last August.

However, for the first time since the new parliament was formed in 2002, MPs voted against a Royal decree - meaning the government could have to look elsewhere for the money.

The decree - issued during parliament's recess last summer - will now go to the Shura Council, the upper chamber of Bahrain's National Assembly, for revision and will be scrapped if MPs' decision is backed.

Government officials appealed to MPs not to block the decree, but their words fell on deaf ears.

MP Ali Al Ateesh accused the government of being greedy by seeking the decree during parliament's recess, without waiting for the issue to go through the National Assembly.

He also accused authorities of trying to make the private sector fund government pay rises - despite government workers already getting paid more on average than those working for private firms.

'This money is taken from the private sector to help the private sector and not so the government can take it to fund government employees' wages, rather than private sector wages which are until today at an average maximum of BD250 ($663),' he said.

Tamkeen is a government agency funded by fees collected from the private sector by the Labour Market Regulatory Authority (LMRA).

These fees include a BD200 charge imposed on companies for expat work permits, as well as a BD10 monthly tax for each expat they employ - although the latter has been frozen since last April to help firms hit by unrest.

However, MP Isa Al Kooheji said it was still unclear exactly where Tamkeen's money was being spent - adding that a detailed statement had never been presented to parliament.

He also argued the government should not even be taking 20 per cent. 'The government has no right to take a 20 per cent share,' he said.

'MPs had to approve it (at the time) when they discussed the set-up law for the LMRA because they didn't want the authority to be delayed.

'Taking 50 per cent is far more than any logic would accept, considering the fund has been set up to help the private sector - not the government sector or to fund any government project.'

Parliament went ahead with the vote yesterday despite pleas from Minister of State for Shura Council and Parliament Affairs Abdulaziz Al Fadhel to postpone the ballot.

He urged MPs not to hold the vote for at least one or two weeks to allow Finance Minister Shaikh Ahmed bin Mohammed Al Khalifa to explain the move.

'We co-operate with you and we want you to co-operate,' he said. 'Time is needed to explain the reason behind the increase in the government's share.'

Finance Ministry Under-Secretary Aref Khamis had told MPs that Tamkeen's projects would not be affected by the government dipping into its coffers.

'We needed money to help meet expenses related to government pay rises in August last year and instead of taking loans we decided to get our money from Tamkeen,' he said.

Meanwhile, Labour Minister and LMRA chairman Jameel Humaidan said the LMRA collected around BD66 million to BD70 million every year in revenues.

He added that the government had waived its right to the BD200 fee for each foreign work permit, which is collected biennially, for the past four years.

'The government for around four years has waived its right to collect the BD200 work permit fees and instead agreed to a 20 per cent share in Tamkeen's revenue,' he told MPs.

'The government still paid more towards the private sector and has been funding my ministry's projects, schemes, helping pay wage differences and financially supporting the private sector throughout.' The decree will now be debated in the Shura Council. – TradeArabia News Service