The government is currently preparing to send monthly stipends between 2 and 3 million families in need of financial aid in order to strengthen the social safety net, a statement from Ministry of Finance said.
Interim Prime Minister Hazem El-Beblawi issued Ministerial Decree 83/2014 to form a committee to look into means of strengthening the state’s social safety net. The committee will be also focusing on assistance programmes “so as to match the government’s policy in targeting the neediest categories of the society.”
Ministers of Finance, International Cooperation, Planning, Social Solidarity and Adminstrative Development are members of this committee.
This system comes in line with government efforts to “reprioritise expenditures to cope with social justice principles”, Minister of Finance Ahmed Galal said in the statement.
The minister added that the current social safety systems are “insufficient”, with subsidised commodities being smuggled and thus not reaching those who really need them.
The new monthly stipends system will be financed from the savings expected from the exclusion of ineligible demographics from the subsidy system, according to Galal.
Sherine El-Shawarby, assistant to the finance minister, noted that the programme will be implemented nationwide within three or four years, with the ministry “considering applying it in Upper Egypt as a preliminary phase.”
The committee will conduct studies to determine those who are eligible for the programme, how they can be reached and the value of the cash they need, El-Shawarby noted.
Earlier in January, the interim government decided to increase social solidarity pensions by 50%, which will be directed to 1.4 million low-income families, effective January. This increase will cost the budget EGP 1.2bn, state-run news agency MENA quoted Prime Minister Hazem El-Beblawi as saying.
The total amount of funds allocated for social solidarity pensions in the 2012/2013 fiscal year ranged between EGP 4.7bn and EGP 4.8bn, former Deputy Prime Minister Ziad Bahaa El Din said in January.
In FY 2012/2013, 25.3% of the country’s population was found beneath the poverty line compared to 25.2% in 2010/2011, the Central Agency for Public Mobilization and Statistics (CAPMAS) reported in December.