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Performance Audit on Employment Generation and Promotion Initiatives

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Performance Audit on Employment Generation and Promotion Initiatives རྒྱལ་ག筴ང་རྩིས་筲བ་དབང་འ潲ན། Performance Audit on Employment Generation and Promotion Initiatives February 2017 Reporting on Economy, Efficiency & Effectiveness in the use of Public Resources Performance Audit Report on Employment Generation and Promotion Initiatives February 2017 DISCLAIMER NOTE The audit was conducted in accordance with the Performance Audit Guidelines and relevant ISSAIs. The review was confined to employment generation and promotion initiatives. The audit was based on the audit objectives and criteria determined in the audit plan and programme prepared by the Royal Audit Authority and the findings are based on the information and documents made available by the audited agencies. This is also to certify that the auditors during the audit had neither yielded to pressure, nor dispensed any favor or resorted to any unethical means that would be considered as violation of the Royal Audit Authority’s Oath of Good Conduct, Ethics and Secrecy. g,r.r oK"3*qI{<qqll ROYAT AUDIT AUTHORITY tsftut an I ntegity 9{ous e #R [leporting on Econumy, Efficiency E Effectiveness in the use of Public Resources RAA (rAD/PA-EMP)/2016-20L7 I e O1 20 February 2017 Hon'ble Secretary Ministry of Labour and Human Resources Thimphu Subject: Audit Report on 'Petformance Audit of Employment Generation and Promotion Initiatives in Bhutani Sir, Enclosed herewith please find the report on the 'Performance Audit of Employment Generation and Promotion Initiatives in Bhutan'. The Royal Audit Authority (RAA) conducted the audit under the mandate bestowed by the Constitution of Kingdom of Bhutan and the Audit Act of Bhutan 2006. The audit was carried out with an overall objective to ascertain whether due regard was given in ensuring economy, efficiency and effectiveness in generation and promotion of emplo5rment in the country, in particular the effectiveness of employment generation and facilitation programs undertaken by the MoLHR including the adequacy and effectiveness of institutional, coordination and monitoring mechanism over the implementations those initiatives. As such, the audit gave more emphasis on reviewing the systemic issues pertinent for effective administration of employment. Further, the audit was conducted primarily in the Ministry of Labour and Human Resources (MoLHR), which is the lead agency to facilitate human resource development and employment in the country. Besides, the RAA also visited implementing agencies identified under 11th Five Year Plan (FYP) to generate employment in order to meet the employment rate target of 97.5 o/o. The audit covered the period from 2010 to 2015 and also included data from2016 wherever necessary. The report contains positive initiatives of MoLHR in overall regulatory functions and management of employment issues in the country as well as the shortcomings and deficiencies observed by the RAA. Bhutan has always given priority to creation and promotion of employment in all its FYPs. Creating gainful employment with a focus on quality of employment is a key importance for the Government as reflected in planning and strategy documents including the 11th FYP. The Government has commitment to reduce unemployment rate to 2.50/0, which is cited as one of the 16 National Key Results Areas (NKRAs) in the 11th FYP. The Labour and Employment Act of Bhutan was enacted in 2007 and the National Employment policy was drawn in 2013. Further, the MoLHR, as a lead agency to zn-.--.:--J:-.:J, -r facilitate employment, has initiated several employment generation and promotion programmes that were successful in supporting many unemployed youths. Important accomplishments and progressive developments noted are highlighted in Part 7, Chapter 3of the report. Notwithstanding these achievements, RAA also observed certain lapses and deficiencies, where corrective actions and improvements are necessary to render the employment management more effectively in the country. Inadequacies observed are detailed in Part 2 of ChapterSof the report and some of the pertinent shortcomings and deficiencies are highlighted below: Absence of effective coordination, monitoring, and reporting mechanism amongst sectors and agencies to achieve the common goal of employment; Lack clear delineation of responsibilities and coherence amongst relevant sectors/agencies at the operational level; Labour market need assessment not carried out for employment facilitation initiations; Impact assessment was not carried out to evaluate the impacts of the employment generation programme; No mechanism in place to supervise and monitor the progress of programs during and after the support period to ensure that there was return on investment; Prevalence of chronic Jobseekers in the |ob market accounting to 17,L35 unemployed youth as of 3Ott fune 2016; I Non-regularisation of seMces on completion of the contract period; I Adequate safety measures were not put in place for the Bhutanese employed overseas of through Bhutanese Overseas Employment Agents (BOEAs); and Absence accurate and reliable information on employment impeding effective decision making. The report has been prepared based on the review of documents made available by MoLHR and based on discussions with relevant officials and employment generation programmes' beneficiaries. The draft report was issued on 22"a November 2016 to the MoLHR for factual confirmation, comments, and feedbacks. Responses received from the Ministry have been incorporated and appended in this report as Appendix-ll The report also contains a set of recommendations, which are intended to help the Ministry in addressing the shortcomings and deficiencies thereby enhancing economy, efficiency and effectiveness in the management of employment generation in the country. In line with the directives of the Parliament, the RAA has instituted a system to fix the accountability on the officials responsible to implement recommendations provided in the Performance Audit Reports. Therefore, we would request the Ministry to identify supervisors who should be responsible for implementation of each recommendation and submit duly completed and signed Accountability Statement (attached) to the RAA. In the event of non-submission of the Accountability Statement, the RAA shall fix the 'Eztery indiaifua[ mrut striae to 6e pircip[e[. An[ indhtifua[s in positbrc of resporci1ilittt must eaen striae fiarder.,, responsibility for implementation of the recommendations on the Head of the Agency. The RAA will follow up implementation of the recommendations based on the Accountability Statement and failure to comply will result in taking appropriate actions, which may include suspending audit clearances to the accountable official(s). The RAA would therefore appreciate receMng an Action Plan for implementation of audit recommendations with definite timeframe on or before 22"d May 20L7 along with the signed Accountability Statement. The RAA would like to thank the Ministry for the support and co-operation extended during the audit. Yours (TsherifleZfirg) Auditor Gefd of Bhutan Copyto: t. The Lyonchhen, Royal Government of Bhutan, Thimphu; 2. Hon'ble Gyalpoi Zimpon, Office of Gyalpoi Zimpon, Thimphu; 3. The Hon'ble Speaker, Gyalyong Tshokhang Thimphu; 4. The Hon'ble Chairperson, National Council of Bhutan, Thimphu; 5. The Hon'ble Opposition Leader, Gyalyong Tshokhang Thimphu; 6. The Hon'ble chairperson, Public Accounts committee, Gyalyong Tshokhang, Thimphu (enclosed five copies); 7. Secretary Gross National Happiness Commission, Thimphu B. Office Copy. ACCOUNTABILITY STATEMENT PERFORMANCE AUDIT OF EMPLOYMEMENT GENERATION AND PROMOTION INITIATIVES Personal Accountability Supervisory Accountability NO. RECOMMENDATIONS Name & Design. EID No. Name & Design. EID No. Strategic response to unemployment situation must be developed in 4.1 collaboration with GNHC and other relevant agencies. The MoLHR should develop an 4.2 Employment Responsibility System (ERS). Labour market need assessment should 4.3 be conducted. MoLHR should establish a robust 4.4 system to monitor and supervise the programmes. MoLHR should conduct a detailed study on unemployed youth and come 4.5 up with a strategy to provide employment to the chronic jobseekers. Ensure sustainable employment 4.6 generation and facilitation programmes through proper studies. Strict enforcement of Regulations on 4.7 Bhutanese Overseas Employment Agent 2013 should be ensured. The MoLHR should bring changes in 4.8 the existing process of conducting labour force survey for improvement. The information management system 4.9 maintained for employment facilitation programmes should be updated. (s/d) Secretary Ministry of Labour and Human resources TITLE SHEET 1. Title of the Report : Performance Audit on Employment Generation and Promotion Initiatives 2. Audit Identification Number : 14180 3. Audited Entities : Ministry of Labour and Human Resources 4. Schedule of Audit : June 2016 - November 2016 5. Audit Team : 1. Sonam Wangmo, Deputy Chief Audit Officer : 2. Tenzin Chhoedup, Sr. Audit Officer : 3. Samdrup Dolma, Audit Officer 6. Direct Supervising Officer : Chandra Bdr. Gurung, Assistant Auditor General, Thematic Audit Division 7. Overall Supervisor : Chimi Dorji, Deputy Auditor General, Department of Performance and Commercial Audit LIST OF ACRONYMS ATP : Apprenticeship Training Programme BOEA : Bhutan Overseas Employment Agent DES : Direct Employment Scheme DHR : Department of Human Resources DoE : Department of Employment DoL : Department of Labour DOS : Department of Occupational Standards EDP : Economic
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