Thursday,14 December, 2017
Current issue | Issue 1181, (23 - 29 January 2014)
Thursday,14 December, 2017
Issue 1181, (23 - 29 January 2014)

Ahram Weekly

Increased social benefits

The government has increased social solidarity pensions by 50 per cent in an attempt to alleviate the financial burdens on low-income people, writes Mona El-Fiqi

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Al-Ahram Weekly

Social solidarity pensions, mainly directed to families with no other source of income, are to be increased from LE300 per month for a five-member family to LE450 a month, the government has said. The surge in the pensions will cost the state LE1.2 billion, according to Prime Minister Hazem Al-Beblawi.
Hani Mehanna, spokesperson of the Ministry of Social Solidarity, said that the beneficiaries of social solidarity pensions were currently estimated at around 1.4 million families. He added that more studies were being conducted to determine those eligible for the support.
The government has also decided to form a ministerial committee including the deputy prime minister and the ministers of social solidarity, supply, administrative development, finance and planning together with the secretary-general of the Social Fund for Development in a bid to strengthen Egypt’s social safety net.
The committee will suggest ways of improving the state social safety net as well as monitoring the implementation of these policies.
However, experts are not completely happy with the moves. Hamdi Abdel-Azim, former chairman of the Sadat Academy for Administrative Sciences, told Al-Ahram Weekly that while the increase aimed at improving the living standards of the poor, the modesty of the increase would make it hard to achieve its aim.
“LE450 is not enough to cover an individual’s needs for a month, let alone those of a whole family,” he said.
However, Abdel-Azim admitted that the government was facing a dilemma and that any additional increases in the pensions would not be financially feasible since the state could not take on extra burdens.
“The increase in the minimum wage to LE1,200 will cost the budget LE9 billion, in addition to another LE9 billion for the annual bonus for public-sector employees. Pensioners are also supposed to get a 10 per cent regular annual bonus in January,” he said.
Another factor limiting further increases in the social solidarity pension was the fact that any increase would feed inflation. Additional purchasing power fed into the local market would not be met by an increase in production, Abdel-Azeem said.
Refaat Al-Said, head of the economic committee of the leftist Tagammu Party was also dissatisfied with the government’s decision. “The government is trying to deceive the public by making such decisions, while in fact nothing is being achieved,” he said.
How could a family live on LE450 per month if the minimum wage set by the government was LE1,200, he asked.
“If the government does not put forward inclusive policies to achieve social justice, it should be prepared for a third revolution from the poor,” Al-Said said.    
To pacify the social unrest, Al-Beblawi’s interim government, which came to power last July, has set a minimum wage for public-sector employees and decided in October to increase the pensions of public-sector workers by 10 per cent.
Another initiative of the sort was the exempting of state school students from paying tuition fees this year, a cost that will cost the state budget LE700 million, according to the minister of education.

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