Light bulb moment: Kuwait PM calls welfare spending 'unsustainable'
His Highness the Amir today opens the new National Assembly term with a speech expected to focus on the internal situation in the country following a second election in under eight months as MPs and activists strongly blasted the government for its new program which said the welfare state is over. The new Assembly term is the actual beginning of the new Assembly elected in July as the previous term consisted of just one session and the election of speaker, deputy speaker and committees. At the start of the new eight-month term, new committee members will be elected who are expected to tackle highly important issues, especially those related to the new government’s four-year program running until 2016/2017.
And as things looked promising for fruitful cooperation between MPs and the government especially after discussing priority issues that need to be debated, the government dropped a bombshell with its program that explicitly told Kuwaitis that cheap or free services are things of the past. The government had repeatedly tried in the past to convince citizens that it was time to reduce subsidies and raise charges in a bid to stop high consumption rates of key services and commodities like electricity, water and fuel.
The call this time comes at a time when the country is enjoying the best-ever financial and economic indicators with the largest foreign investments ever estimated at $400 billion and when oil revenues set an all-time record high in the past fiscal year, crossing the $100 billion mark for the first time ever. The government’s austerity measures also come when Kuwait has had 13 consecutive years of budget windfalls and is set to post a healthy surplus for the 14th year, accumulating well over $300 billion in surpluses.
MP Faisal Al-Duwaisan said the government program is rhetorical and “exempts me from any commitment to cooperate with the government”, adding that the government can impose taxes but it should then behave like a civilized government by treating people equally. MP Abdullah Al-Turaiji called on Development Minister Rola Dashti to step down “because this is not a plan but a load of rhetoric and cheating of people”. MP Safa Al-Hashem said the government presented a very weak program that is not based on economic realities, saying that the government has warned of incurring a real budget deficit in 2021 while it should be held responsible for the situation and not the people.
In its program, the government said that it was not possible to continue with the current generous welfare system and there is a need to review subsidies and charges on public services. MP Abdulkarim Al-Kundari said the government program is an acknowledgment that it has failed to run the country. The program is expected to become a flashpoint in the new term as many MPs are expected to oppose the program.
By B Izzak
- Trouble getting them, trouble keeping them? Middle East firms challenged in attracting, retaining talent
- Does capitalism provide a solution to terrorism?
- No pain, no gain: Tunisian economy needs three years of tough love before rebounding
- How will MENA economies look in 2015?
- Sanctions face-off: Iran to unveil its corporate side in London next week