A number of MPs warned yesterday that a reported government plan to lift subsidies on electricity, water and fuel to increase their prices will not pass through the National Assembly and will be strongly rejected. MPs Saleh Ashour, Mohammad Al-Hadiya, Saadoun Hammad and Saif Al-Azemi also called on the government to issue an official statement over the report which was published in the Arabic press to clarify its position towards the report.
The opposition to the reported decision has so far come mainly from pro-government MPs which means that the government is expected to have tough time passing such austerity measures through the National Assembly. MP Ashour said in a statement that the government cannot legally increase prices of public services because the National Assembly issued a law in 1992 banning such a measure without the prior approval of the National Assembly.
MP Hammad said the National Assembly will not accept any plan to lift subsidies on public services because this will greatly harm low and middle-income families. MP Hadiya said that the planned raise of electricity from two fils a kilowatt to seven fils and petrol from 60 fils a liter to 110 fils as stated in the report is “a crime against citizen consumers who include many low income families”. He said that Finance Minister Anas Al-Saleh had previously said that citizens and expatriates will not be affected by the planned increases in public services but it appears that the government has retracted its statements on the issue.
Hadiya stressed that such an intention by the government is not correct and it will never pass through the National Assembly. MP Azemi said the National Assembly’s main job is to provide more financial stability for the Kuwaiti family and not to increase the burden on them and accordingly lawmakers will strongly reject any government plan to raise prices. A few months ago, the Council of Ministers decided in principle to end subsidies on diesel which is rarely used by the public after a large number of MPs called for the measure following large-scale smuggling that cost the state hundreds of millions of dinars.
The Cabinet action came on the basis of a report by a committee formed a year ago to study the issue of subsidies which have rapidly increased to around KD2 billion annually mainly as a result of the sharp rise in oil prices. The Finance Minister has repeatedly said that any lifting of subsidies will not harm low and middle income sections of the society and any decisions will aim to ensure that subsidies go to people who actually need it.
The committee is expected to have completed its work and its recommendations are expected to be discussed at a joint meeting of the council of ministers and the higher planning council next week. It appears that the government wants to make the lifting of subsidies a key policy of the five year plan for 2015/2016-2019/2020 which will be submitted to the National Assembly at the start of the new term at the end of this month.