CAIRO: Statements made by President Hosni Mubarak and those made by the Cabinet over the new subsidies program do not conflict, Cabinet spokesman Magdi Radi told Daily News Egypt.
Last week, the Associated Press reported that Mubarak opposed Prime Minister Ahmed Nazif’s statement that Egypt plans to do away with its antiquated subsidies program, suggesting that the decision has not been finalized.
However, Radi explained, both the cabinet and the president agree that the issue needs to be discussed further.
According to Radi, Mubarak asked the Prime Minister to initiate discussions about the government’s current subsidies program and how it can be improved, focusing on dealing with the significant loss of money incurred and the inefficient distribution of subsidized products.
“We started a discussion with a small ministerial group, and in the coming weeks, the Prime Minister will meet with some chief editors, members of the People’s Assembly and National Democratic Party to discuss ways to modify the government subsidies program, Radi said.
On Dec. 3, Al-Masry Al-Youm reported that the main motive behind the government’s plan to reform the subsidies program is businessmen’s failure to create a sufficient number of job opportunities, despite concession provided by the government.
Radi said this statement was “incorrect, and it mixed things up, adding that the government is getting experts’ recommendations to make the most out of the subsidies program.
“We are studying the different approaches that would help improve the system, Radi said, “one of the proposals is to provide cash paid only to the needy as opposed to subsidizing specific products to make sure that it reaches those it is meant to reach, Radi said.
It would take “months or even years to discuss the subsidies program before any changes are implemented, said Radi, describing the program as a “very important and serious issue that has social and economic impact.
According to Radi, there are two reasons behind the government’s decision to reform the subsidies program.
Firstly, subsidized products are “leaked to the black market and sold for triple their price. Secondly, some subsidized products are purchased by the wealthy, which is not the target market of the subsidies program.
“For example, some rich people might buy subsidized bread to feed animals while others make a business out of reselling it in the black market, Radi said.
The government spends millions on subsidizing basics and petroleum products, he explained, with an inefficiency rate of around 20 to 30 percent, which “results in a substantial amount of loss.
