February 07-2014
The government has decided to punt on welfare reform and will change the program at the beginning of the summer rather than at Now Ruz as previously planned.
That gives officials five months to figure out how to reduce costs.
The Mehr news agency said the Majlis voted Tuesday to make all the changes to the program—whatever is eventually decided—take effect June 22, the first day of the second quarter in the Persian calendar.
The Rohani Administration and the Majlis are in agreement on a goal of cutting the welfare budget by 30 percent.
The program currently pays 455,000 rials ($15 at the open market rate) each month to every citizen.
The talk is about halting all payments to the wealthiest 30 percent of the population. But no one has said how that can be done.
The original program laid out about five years ago called for scaled payments, with the lowest deciles getting big payments, middle deciles getting lower payments and the wealthiest getting nothing.
But the Ahmadi-nejad couldn’t figure out how to divide 75 million Iranians into different wealth groups and so decided to pay everyone the same amount. All agreed that was an improvement over the old system of subsidizing gasoline, electricity and other items since the wealthy used more gasoline and electricity than the poor and were getting more subsidy money than the poor.
But the welfare-for-all program is breaking the bank and just about everyone now agrees something must be done. But until someone describes how the government will determine who is rich and who is poor, all the talk about the goal really means very little.