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At long last there is going to be a social protection policy to promote economic security for workforce in the private sector. This is good news that we must all commend the initiative.

A ray of hope for private sector growth

At long last there is going to be a social protection policy to promote economic security for workforce in the private sector. This is good news that we must all commend the initiative.

The policy will have six protection schemes for the private sector, including retirement and pension schemes, and unemployment insurance. Lack of all these and more has been the reason why jobseekers prefer civil service to employment in the private sector.

The good thing about this policy is that it is soon going to be here although it is a little too late. We would not be talking about the need to improve private sector growth still otherwise. If private sector is the engine of economic growth as we are being told repeatedly, let it indeed be the engine of economic growth.

Hopefully the policy will help create avenues for private sector to grow and generate employment opportunities because that is the real purpose of the schemes. We could play with figures here and there every now and then, but it is important that we know unemployment issue is becoming serious, especially among youth.

Private sector will have to implement unemployment insurance scheme that will be funded by unemployment insurance tax collected from employers. The ultimate purpose of this scheme is to support workers who lose their job or are in between jobs. It is designed to protect workers and their families from dramatic shocks after they lose their job.

For the owners of businesses, this will be a challenge because their ultimate objective is to maximize profit. It is, therefore, important that the policy does not backfire. Schemes should not impede but assist private sector growth.

Creating a strong social protection system requires well-developed financial sector that is able to provide insurance and savings schemes designed to help workers protect themselves against unforeseen shocks. Do we have that? We need to bolster our financial sector before we launch the schemes because that is a critical requirement.

It is not enough that we have policies and promises. Private sector should implement the schemes and the government should see that it works.

It is critical that our private sector grow.

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