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Budget 2016-2017 Highlights: Measures to deal with root causes of poverty

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02Aug

Budget 2016-2017 Highlights: Measures to deal with root causes of poverty

The Minister of Finance and Economic Development, Mr Pravind Jugnauth, listed out the measures to deal with the root causes of poverty while presenting Budget 2016-2017, on 29 July 2016. According to him, this strategy was chosen because Government has pledged to fight poverty and empower families at the lower rung to move up the ladder. This commitment underpins the core philosophy of this Government, he said.

This Budget is concretely launching the Marshall Plan Against Poverty, the Finance Minister stated, adding that it includes a variety of programmes and actions that interlock to assist and empower poor families. As from December 1st 2016, a new scheme will be introduced under which every adult on the Social Register of Mauritius (SRM) will be entitled to a monthly subsistence allowance based on a minimum threshold of Rs 2 720 with a maximum threshold of Rs 9 520 for a family of two adults and three children. This is higher than the current threshold of Rs 6 200 and an amount of Rs 500 million over the transition period of two years will be required to implement this measure.

For Mr Jugnauth, another major programme to empower these families to break away from the poverty cycle and stand on their own feet is on improving educational achievements. Consequently, to encourage students from poor families to achieve higher levels of education, Government will give them a cash award as follows: Rs 15 000 for successfully completing the grade 9 level under the nine year schooling; Rs 25 000 for successfully completing the School Certificate level or equivalent vocational certificate; and Rs 35 000 for those successfully completing the Higher School Certificate or equivalent technical qualification.

Moreover, to give a second chance to students from poor families for exam resit at the School Certificate and Higher School Certificate levels, their examination fees will be borne by Government. As regards the crèche voucher scheme for poor families, the monthly grant is being increased from Rs 1 500 to Rs 2 000 per child, to allow these children to get a good start in life.

Poverty

Government believes that a decent shelter is the next most important lever to lift families out of poverty. In the context of the Marshall Plan, a programme of decent shelters for the absolute poor that will comprise the construction of at least 800 housing units that will span over the next three years is being launched.

For low income families, this Budget is providing: Rs 1 billion for the construction and completion of 1 900 units of up to 50 square meters each, on 16 sites across the island; and Rs 155 million for the rehabilitation programme of National Housing Development Company Ltd (NHDC) housing estates. Furthermore, the monthly income limit for eligibility under the NHDC social housing scheme is being raised from Rs 10 000 to Rs 20 000.

Budget 2016-2017 also states that all arrears of interest on loans contracted by individuals from NHDC and Mauritius Housing Company Ltd, and whose monthly household income does not exceed Rs 15 000 are being waived, provided the capital amount outstanding is duly repaid. This measure is expected to protect these families from facing the tough and traumatising Sale by Levy experience.

The Basic Invalidity Pension which was provided only to persons above 15 years who suffer from disabilities is now being extended to children below 15 years of age and with disabilities. Moreover, Government is granting an additional sum of Rs 100 million for around 3 130 cases.

Under the current Budget, Government is launching a special scholarship scheme for five students with disabilities for pursuing tertiary studies locally. The scholarship will cover the fees as well as a monthly stipend of Rs 5 000. Concerning Special Education Needs, the grant-in-aid to NGOs in that sector is being increased by more than 50 percent to Rs 90 million.

Furthermore, in line with the recommendations of the Marshall Plan against Poverty, the National Empowerment Foundation will be restructured for effective service delivery to the poor and vulnerable groups. There will be a shift of focus to proactive case management and sustainable empowerment programmes.

Corporate Social Responsibility

As regards Corporate Social Responsibility (CSR), a National CSR Foundation will be set up and managed jointly by the public and private sectors. Businesses will be required to contribute at least 50 percent of their CSR money to that National Foundation. This will go up to at least 75 percent the following year. The remaining balance may be used to implement their CSR programmes in accordance with their existing framework. The NGOs will therefore continue to benefit from contributions from the private sector and any unspent balance from the 50 percent will be channeled to the National CSR Foundation.

In addition, the money endowed to the Foundation will be allocated to support civil society actions in six priority areas: Poverty alleviation; Educational support; Social housing; Supporting persons with severe disabilities; Dealing with health problems resulting from substance abuse and poor sanitation; And family protection.

As regards poverty alleviation, educational support and social housing, the CSR support will be for families in the SRM.

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