Pandemic Budget - Why & How?

Bangladesh's Economic Condition

Bangladesh's economy has been growing strong since its independence. During the time of Global Financial Crisis (2007-08), Bangladesh's economy managed to remain stable. In spite of being a developing country, the collective hard work of the Bangladeshi people and the right strategy at the right time helped her to have a strong economical background during this crisis situation.

Covid-19 and Bangladesh

Though the GFC in 2007-08 did not have much impact on Bangladesh's economy, the 2020 Coronavirus Pandemic has created a huge impact on her economy and therefore her people and their lives. After the first confirmed Covid-19 case on March 08, 2020, Bangladesh did not take the protective measures that should have been taken at least two months earlier. Instead, it kept on going for more than two weeks. This led the virus spread at an alarming rate. By the time the government announced general holiday from March 26, 2020, the virus was all over the place and as of August 30, 2020, Bangladesh was ranked 15 among all the countries of the world having 308,925 confirmed cases.

After accepting the new normal, people in general are not maintaining proper health-hygiene at offices. The restaurants are now open. People are seen without masks and other protective measures in public places. When the number of cases per day was one or two or three, the entire country went to total quarantine. Surprisingly, when average number of deaths per day came up to 40, the entire country came to the new normal without proper hygiene; not even proper training and instructions from the authority. Not to mention, people came out of their homes during the general holidays and it was difficult to keep them home. All these happened because the country was not ready.

Bangladesh is a densely populated country with moderate literacy rate. No country of the world was ready to face a situation like this. Bangladesh is not an exception in this regard. On the contrary, it has been doing tremendously worse than the other countries because of these two factors. Every country should have a contingency plan to tackle such pandemic situation for at least a year and educate the people accordingly.

Job Sector During Covid-19

Many people of the country have lost their job. They are being terminated, retrenched, discontinued and even dismissed. Some are working without salary while some are taking forceful leave without pay. So, basically, this is where the Coronavirus Panic hits the most. People who are being terminated or retrenched, are getting terminal benefits. Some of the skilled workforce are joining some place else with higher salary as well. So, when the pandemic will be over and they will be needed again, the company that retrenched them will have to pay them higher than what they were getting earlier. Not to mention, their terminal benefits are also huge which was paid at a single time. So, this is a total loss to the company just because it panicked and lacked appropriate strategies.

While companies are making good money, they often think to reinvest, disburse some small part of the profit to the employees and/or keep the money in the bank. So, like the country itself, companies too lack contingency plans for pandemic situations. No one knows when this situation is going to be over. But the companies need not to panic as much they are panicking right now. The business may not be as good as before for the time being, but the companies need to take care of their employees equally. This can happen by a deduction of salary and some variable costs, total freeze of other benefits and so on. If a company cannot feed its employees for a year with minimum profits or no profits or even a loss and salary, then that company loses to be an employer of choice.

Pandemic Budgeting

If this pandemic situation is over, companies need to have a Pandemic Budget for any future crisis situation. This should have a committee who will evaluate company's profitability and position and save a particular amount for situations like this. No one, even the owner will be able to utilize the money for any other cause. Let's say, company X makes USD 10,000 profit a year. It will save 20% of the profit a year for the panic budget. So, that leaves USD 2,000 a year for the employees. Save this amount until the company is able to feed all the employees for over a year with their salary only. They even can continue the budget after they reach this target as part of a contingency plan. Whenever another crisis situation hits, employees will get salaries or deducted salaries from this budget. But the deduction rate has to be equal. This will help secure their jobs and maintain their families with minimum standards. This is just an idea. There can be a lot of other ways to do a Pandemic Budgeting. For example, this budget can be done by a mutual fund raised equally by the employee and the employer.

To summarize

Organizations are run by the people. There is no reason to push loyal employees away for not having proper strategies. If organizations take care of the employees during their hard times, employees will do the same during company's hard time. They will feel motivated, safe and proud to work in an organization that takes care of them. Because at the end of the day, companies bet on people, not on strategies. And just like companies, countries should focus on the next pandemic situation and prepare an annual budget for it. Only proper contingency plans and collective actions by both government and private sector will save us from the next pandemic.