Page 27 - IRANRptDec19

6.0​ Public Sector 6.1​ Budget
Iran rushes in subsistence money for all citizens to help quell petrol price protests
Iran removes more ‘non-low-income’ citizens from “Subsidies Law” cash handout scheme
Iranian President Hassan Rouhani has announced that he has expedited subsistence help that will start on November 18 for citizens, following the mass protests​ a​ gainst his government across Iran after officials brought in a sudden petrol price hike of a minimum 50% for motorists prior to the weekend.
According to a 30-minute cabinet address by Rouhani, each person in Iran will receive IRR550,000 (€4.00 per person at the street rate) for a family of four, or IRR2.05mn (€12.20) for a family of five per month.
Rouhani said the subsistence would be paid first thing tomorrow to people’s accounts, despite the government not receiving the dividends of the petrol price rise as yet.
“After implementing this plan, we saw that some people took to the streets to protest. I believe that it is natural when the administration implements a plan and not everyone agrees to it. Some people may be opposed [to that plan] and they have the right to give voice to their opposition,” the president said.
Rouhani said that if the government hadn’t increased fuel prices the country would have been forced to become a net importer of petrol. Such a situation might pose a problem for Iran given the crushing US sanctions it is under.
Even after the hike, Iran’s petrol prices are among the lowest in the world.
Meanwhile, Iran’s Fars News Agency that government officials estimated that the nationwide protests against the petrol price move involved around 87,000 people. One Iranian news outlet claimed that a Western news agency had reported that 16mn people had taken to the streets in the country of 82mn.
The Iranian government has removed another 400,000 citizens from the monthly cash-handout “Subsidies Law” scheme introduced by the Ahmadinejad administration eight years ago, ILNA reported.
The scheme pays out the equivalent of around €3.50 (at the unofficial exchange rate) to people deemed to be on low incomes to help with utility bill payments. However, there has been a lot of debate over whether many recipients cannot be objectively described as “low-income”. At the same time, the government’s budget is under severe pressure, thus officials are looking to make cuts that will not translate into substantial social pressure.
The past couple of months have seen the officials remove 1.1mn people from the list of those entitled to the subsidy. The government announced in July that it was planning to remove the​ ​top three deciles from the recipient group​ ​in a bid to cut costs.
The Rouhani administration is attempting to cut budget costs as part of an austerity plan in the face of the US sanctions exacting a heavy toll on the Iranian economy.
27​ IRAN Country Report​ December 2019 www.intellinews.com