Gov’t targets shifting subsidy beneficiaries from commodities to bread
Gov’t targets shifting subsidy beneficiaries from commodities to bread: The government is targeting reducing the number of subsidized commodities beneficiaries and raising the number of those eligible for bread subsidies during FY2018-19. According to reports on the government’s preliminary budget for the upcoming fiscal year, subsidized bread recipients are expected to rise to 78.6 mn citizens, up from 76.8 mn this year, while the number of benefactors for subsidized commodities will drop to 69 mn individuals from 71 mn currently. Overall spending on commodity subsidies is expected to rise 36.6% next year to EGP 86.18 bn. Subsidy card holders are currently allotted five loaves of subsidized bread per day, and are currently able to use their surplus bread points to buy other commodities through subsidy vendors.
Meanwhile, the Supply Ministry is reportedly looking to increasingly rely on imported, rather than locally produced, wheat for subsidized bread production, an unnamed ministry source said, according to Al Mal. The new system would source 75% of the wheat needed from imports and the remaining 25% from local farmers, whereas the current split sees 60% coming from imports and 40% from local production. Farmers’ Syndicate head Hussein Abdel Rahman tells the newspaper that the move is likely a result of the government’s decision to set the wheat purchasing price below farmers’ expectations, which is expected to drive down the amount of wheat farmers will sell to the government. The ministry is expected to announce the decision after the end of the current harvest season, which kicked off on Sunday, but it remains unclear when the changes will come into effect.