According to local media reports, Iranian government is intending to increase the dedicated cash handouts but Mohammad Kordbache, a high-ranking official of Ministry of Economic Affairs and Finance, says these reports are baseless and the government is even looking to cut subsidies.
“Unfortunately, Majlis didn’t pass our desired budget for subsidy reform plan in this year. We have received only $7 billion for this project. According to agreements with parliament, 10% of this budget will be allocated to Ministry of Health and Medical Education. Iranian government will also pick up 10% of this budget. Other 30% of the mentioned budget will be spent in production fields, and the 50% remaining will be divided between people.” Mohammad Kordbache informed Pars Herald. He also said that Iranian government will not allocate any budget to construction and building fields.
“At this time, we are considering the possibilities of increasing the price of fuels and gasoline in Iran. By doing this, we will be able to make more money from subsidy reform plan. This also enables us to pay cash handouts like before. But if we fail to do this, we must cut the number of people who receive handouts from government.” Kordbache added.
Economists and members of parliament don’t have positive views on starting the second phase of subsidy reform plan in country. Mahmoud Ahmadinejad, Iranian President, has previously censured the negative stance of parliament against government over subsidy reform plan.