Monetary vs product subsidy system could save gov't billions

CAIRO – 28 June 2017: Providing monetary subsidies instead of subsidies in the form of products is the best way for the government to offer aid to lower income brackets, deputy head of the Industry Committee of the House of Representatives Mohammed Mohamed El Zeiny said Wednesday.

A monetary subsidy can more easily be correctly delivered to those most in need and avoid any means of bribery or corruption, he said. This kind of subsidy program could save the Treasury hundreds of millions of Egyptian pounds which are being “wasted” in the current subsidy program, which depends upon handing out products, Zeiny added.

Zeiny clarified further that subsidies in the form of products were being delivered both to those who deserved them and those who didn’t, meaning government funds were being wasted. He suggested drawing a political plan in order to achieve a balance to implement the monetary subsidy system.

El Zeiny suggested a number of steps that should be followed before implementing the new subsidy system, including: determining incomes that deserve subsidy, preparing accurate data for those who deserve subsidies and identifying and removing undeserved ration subsidy cards.