World Economy

Bahrain MPs Threaten to Block Budget

Bahrain MPs Threaten to Block BudgetBahrain MPs Threaten to Block Budget

Bahraini MPs are threatening to block the national budget for this year and next if the government insists on its plans to reduce subsidies.

The warning was issued Tuesday in a parliament statement that was unanimously approved by MPs, some of whom have threatened to resign if subsidies are revoked, TradeArabia reported Wednesday.

In the statement, released by parliament chairman Ahmed Al Mulla, MPs threatened repercussions if the government followed through on proposals to axe meat subsidies from August 1 and compensate eligible Bahrainis with payments into their bank accounts.

The statement also criticized the government plan for being vague, since it is not clear who will qualify for the food allowance once meat subsidies are scrapped.

Bahrain’s cabinet has also announced that fees for government services that are currently subsidized will increase from August 1, when they will be provided at cost price.

Meanwhile, information affairs minister and official government spokesman Isa Al Hammadi revealed on Monday that the second phase of cuts would see power and water subsidies, which are expected to cost the government BD325.5 million ($857.5 million) this year and BD315.7 million next year, scrapped.

Oil and gas subsidies are likely to be scrapped in the third phase of the subsidy reductions, but the minister did not say when phase two and three would be implemented.

“We reject the government’s unilateral decision to axe meat subsidies last week and other cuts that will follow, as announced by the cabinet on Monday, which contradicts the agreement that nothing will be enforced without MPs’ and Shura Council members’ consent,” said the parliament statement.

“Parliament has repeatedly asked the government not to affect people’s livelihood and to keep subsidies as they are in the new budget for this year and next.