Big businesses should do more in hard times

The full impact of the Covid-19 pandemic on government, businesses and households in the coming months can only be modestly described as cataclysmic.

Our way of life, social cohesion and public system will be tested to the limit. In a population where 80 per cent of the workforce technically live a wageless life, meaning they earn to eat that day, the impact will be devastating.

While it is all hands on deck, big businesses have an especially important role to play. Their depth of financial resources, geographical reach and human capabilities put them in pole position to make the greatest mitigation against the pandemic.

In recognition of this, US President Donald Trump has invoked the Defence Production Act to force big businesses in America to mass produce ventilators and other much-needed medical supplies.

Back home, I am not sure what is our equivalent of the defence production act, but government can invoke price controls to cushion poor Kenyans by reducing the prices of essential services such as telecommunications, money transfers, power and water.

Big business such as breweries and bottlers should be asked to use their packaging and distribution capabilities to get the much need hand sanitisers to consumers at fixed prices.

CUSHION BUSINESSES

Asking big business to do more should be at the core part of the proposed Pandemic Response and Management Bill 2020 by Nairobi Senator Johnston Sakaja.

It is sad to note that some of their contributions to the National Covid-19 Emergency Response Fund, even though voluntary, do not reflect the massive profits they have been flaunting.

The bill should not be about inciting tenants against helpless landlords already heavily saddled with bank loans, construction costs, rent defaults and taxes.

So far, there are no tangible measures to cushion small businesses from the pandemic. With the recent reduction in corporate tax from 30 per cent to 25 per cent, the government knowingly or unknowingly just handed a huge benefit to large corporates which control essential services and those in near monopolistic positions making huge profits.

Similarly, the reduction in the upper income tax bracket from 30 per cent to 25 per cent will mostly benefit high income earners and not the poor.

PRO-POOR POLICIES

These tax measures will not change the fortunes of small businesses, farmers and low-income workers, a majority of whom were in dire straits even before the pandemic.

As the government mulls more measures to deal with the pandemic, it must constantly introspect to ensure it is seeing through the lenses of the poor, and not big business.

A story is told of a wealthy king who received an unexpected but important visitor. Instead of picking from his large flock, he forcefully took a poor man’s only lamb to prepare a meal for his guest.

Hopefully our decision makers will be guided differently during this pandemic.

The writer comments on topical issues. [email protected]