Draft budget maintains social protection – Egypt – Al-Ahram Weekly
Despite the measures that the government has adopted to deal with the wave of soaring prices and the repercussions of the Russian-Ukrainian war, it has decided to increase social protection expenditure in the new draft budget 2022-23 presented to the House of Representatives, the lower house of the Egyptian parliament, at the end of March.
Allocations for wages and salaries section in the new budget increased from LE 318.8 billion in 2021-22 to LE 400 billion split into LE 36 billion on salaries, LE 38.5 billion on pensions , LE 8 billion on tax exemptions and LE 2.7 billion on the Takaful and Karama (Solidarity and Dignity) welfare programs, an increase of LE 450,000.
The draft budget allocates LE 332.1 billion for grants, subsidies and social privileges, up from LE 263.8 billion in 2021-22.
The government has taken care to broaden the framework of social security protection by increasing the number of beneficiaries of the Takaful and Karama programs and by intensifying the work on the Decent life initiative in poor villages and on the Lifeboats initiative aimed at raise awareness of the dangers of migration.
It aims to reduce unemployment rates by providing five million job opportunities in national projects.
The government has also decided to allocate LE 5 billion for the appointment of 30,000 teachers and 30,000 doctors and LE 1 billion for promotions.
Egypt is the world’s largest importer of wheat from Russia and Ukraine, and amid rising global prices, the new draft budget allocates LE 95 billion for bread subsidies. The value of the allocation compares to LE 87 billion in the previous year and signifies that the government does not intend to switch from in-kind to cash grants as previously planned.
At the same time, the government has started to define the objectives of the state investment plans for the next fiscal year, focusing on supporting Egyptians through the creation and development of 36 hospitals, the provision of 1,500 new intensive care beds and the creation of 27 new desalination plants and 115 wastewater treatment plants.
Plans also call for the construction of 25,000 classrooms in schools to reduce the number of students in each class.
Alia Al-Mahdi, professor of economics at Cairo University’s Faculty of Economics and Political Science, said the increase in social protection spending was necessary because the middle and lower income classes bore the brunt. weight of the economic reform measures implemented since 2016.
She added that the government was responsible for providing all kinds of support to these groups and suggested replacing in-kind grants with cash grants.
Mustafa Salem, deputy chairman of the House of Representatives Planning and Budget Committee, said the government’s propensity for sweeping measures necessitated a revision of some sections of the draft budget, excluding Social Protection.
The committee suggested reviewing the entitlements of entities included in the general budget, such as units of the state administrative apparatus, public service bodies and local government bodies, with the aim of integrate units with similar functions under the same umbrella in order to reduce costs.
In addition, the commission proposed to reformulate the responsibilities of certain ministries to obtain optimal results and make the best use of the allocations allocated to them in the general budget.
He called for officials to be held accountable for any decision that could be shown to waste public money.
Salem said some ministries had appointed large numbers of much-needed expert advisers and representatives to diplomatic missions and consulates. He called for limiting the number of officials to those with the necessary expertise.
In-depth studies must be carried out on projects before they are implemented to measure their economic and social impact, whether they are financed by the state budget, loans or grants, he said.
Plans to deal with financial, organizational and administrative challenges that may arise during the implementation of projects should also be implemented, he concluded.
*A version of this article appeared in the April 7, 2022 edition of Al-Ahram Weekly.