Thursday, September 29, 2022

“Rise in Cash Subsidies Needs MPs’ Approval”

A top Iranian parliamentarian says the issue of increasing cash subsidies, promised by certain presidential candidates, will be subject to the Parliament’s approval.

Senior member of the Iranian Parliament Mohammad-Reza Pour-Ebrahimi said in a Farsi interview with ICANA that any rise in the amount of cash subsidies must pass through the parliament first.

“The amount of cash subsidies has been set in the Subsidy Law, and [currently] some 42 trillion rials [almost $1.1bn] in cash subsidies are paid to all [income] deciles of the society; this runs counter to the Subsidy Law, but this was done during the past and current administrations,” said Pour-Ebrahimi, who sits on the Parliament’s Economic Commission.

“If the administration wants to make a decision on the subsidies, it must first secure the parliament’s approval,” he noted.

The MP’s comments come amid promises by some Iranian presidential candidates to increase cash subsidies (Qalibaf) or offer more financial assistance to the three lowest income deciles of the population (Raisi).

The parliamentarian’s remarks mean if the candidates want to fulfill their pledges of giving more cash to the people, they must receive the Parliament’s go-ahead first.

On the other hand, it would be impossible to triple the cash subsidies all at once without canceling subsidy payments to the top three deciles of the society (who are not considered rich, either). Moreover, it would not be possible to (as stipulated in the law) increase the prices of energy commodities all at once in order to provide enough funds to bankroll the cash subsidy program.

To put it in a nutshell, the MP’s remarks could be regarded as a reminder to the presidential candidates on the subsidy issue.

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