Parliament likely to approve new state bodies private funds

CAIRO – 20 June 2017: The Parliament on Tuesday gave a preliminary approval for a draft law submitted by the government to allocate a percentage of the accounts belonging to private funds owned by state entities, and state bodies of special nature to the public treasury.

Parliamentary Speaker Ali Abdel Aal stated that the confrontation between the parliament and the stakeholders of these funds and state bodies would not be easy as it has always given room for corruption.

The speaker affirmed that the provisions of the law do not contradict international agreements.

Private funds are established by institutions, syndicates, and groups of individuals to give its members pensions, salaries, compensations, and other financial benefits.

The Minister of Finance Amr El-Garhy stated in the general session that the total value of private funds in Egypt is only LE 33 billion ($ 1.83 billion) and not LE 700 billion ($ 38.89 billion) as propagated through rumors.

The law consists of four articles. The first articles says that “as an exception to the provisions regulating funds, bank accounts, and units of special nature affiliated with the state’s administrative body and local administrative units, a percentage of each of their bank accounts would be allocated to the public treasury once as follows:

-One percent for all accounts of value ranging between LE 5 million and LE 20 million.

-Five percent for all accounts of value ranging between LE 20 million and 50 million.

-10 percent for all accounts of value ranging between LE 50 million and LE 100 million.

-15 percent for all accounts of value above LE 100 million.

Exempts include:

-The accounts of research projects funded through grants, international agreements, and donations.

-The accounts of university hospitals, health care institutions, and funds allocated to health care services improvement, and providing health care and social services to these entities’ employees.

-Projects of social housing (housing establishment for low and middle income citizens).”
The second article urges the entities mentioned above to transfer the value of the percentages mentioned above to the account dedicated to supporting the resources of the public treasury in the Central Bank of Egypt (CBE). Failure to transfer the amounts within 15 days after the promulgation of the law grants the Ministry of Finance the right to withdraw the sum directly from these bank accounts.

The third article states that “as an exception to the provisions regulating funds, bank accounts, and units of special nature affiliated with the state’s administrative body and local administrative units, the owning entities have the right to transfer surpluses to other bank accounts, after getting the permission of the Ministry of Finance, to bridge budget deficits as long as the expenses covered by these private funds’ accounts are not negatively affected.”

The fourth article necessitates the publishing of the law in the Egyptian gazette Al Waka’e, and that it would be put into effect on the following day of its promulgation.