Egypt sets Annual budget of EGP 150 bln for raising salaries, pensions: Finance minister

Egypt sets Annual budget of EGP 150 bln for raising salaries, pensions: Finance minister Sun, Mar. 5, 2023
CAIRO, 5 March 2023: Egypt's Minister of Finance Mohamed Maait said an annual package of EGP 150 billion to increase salaries and pensions decided by President Abdel-Fattah El-Sisi will cost the state's treasury an estimated amount of EGP 150 billion.

The money will be disbursed as of April as part of the state’s efforts to contain the international wave of inflation and alleviate burdens on the public, he said in a statement.

The minimum salary increase is EGP 1,000, he said, noting that a periodical bonus of 8 percent is included in this package under the civil service law.

Maait added that the state treasury will bear about EGP 8 billion by expanding the tax exemption limit on annual income by 24 percent, from EGP 24,000 to EGP 30,000.

The state will also bear about EGP 6.5 billion annually for a 25 percent rise of monthly funds allocated for beneficiaries of the Takaful and Karama solidarity program as of April, he said.

Maait added that about EGP 55 billion annually will be earmarked for a 15 percent uptick in pensions with a minimum of EGP 170 and a maximum of EGP 1,635.

He said that as per President El-Sisi's directives, government employees covered by the Civil Service Law will also receive a periodic bonus of a minimum of EGP 125 (8 percent) starting 1 July. The same will apply for those not covered by the Civil Service Law starting 1 April.

Maait also said in an interview with Al-Ahram newspaper on Saturday that the current FY 2022/23 budget's reserve allocations will be used to fund President El-Sisi's new social initiative.

"These reserve amounts will be redirected to the budget's wage allocations to spend on the president's initiative," said Maait, indicating that "the Finance Ministry will make sure that the new hike in wages and pensions will go into effect as of 1 April in line with President El-Sisi's initiative."

"The government is doing its best to alleviate the burdens of the inflationary wave triggered by this war," said Maait, insisting that "the Egyptian economy has so far proved resilient in the face of global economic crises which have hit hard most world countries."

"The financial governance measures and the rearrangement of priorities adopted by the finance ministry to rationalise spending and boost revenues have made the budget flexible enough to absorb global shocks and meet the needs of social and vulnerable brackets," said Maait.

Meanwhile, Fakhri El-Fiqi, chairman of the Egyptian parliament's Budget Committee, said in a TV interview that an estimated number of 35 million citizens will benefit from El-Sisi's new social protection measures.

"Most of these citizens belong to limited and average-income classes which are in desperate need of wage and pension hikes in order to be able to bear with the high cost of living," said El-Fiqi, indicating that "we have 4.5 government employees who will take advantage of President El-Sisi's new social protection measures, and the families of these employees include 22-25 million citizens."

"We have 10-11 million citizens whose pensions will be raised by 15 percent, and this makes the total number of citizens who will directly benefit from President El-Sisi's new social protection measures an estimated 35 million," said El-Fiqi.