CAIRO: Next March the government will introduce new “smart subsidy cards tailored to match citizens’ income brackets and social status, the state-owned Al-Ahram daily reported Friday.
The new cards will be introduced in 11 governorates to cater to 7 million families which, add up to around 28 million citizens.
Those governorates include Al Sharqia, Port Said, Al-Menofiya, Beni Suef, Al-Daqahlia, Luxor and parts of Maadi in Cairo.
The new cards are slated to include all the information necessary about each of these families and their social and economic status. This same information will be included in a network linked to outlets where these subsidized products are sold.
The announcements came amid much debate over the future of government subsidies, with speculation that the government plans to cancel them altogether.
The rumors prompted President Hosni Mubarak earlier this month to publicly declare that statements made by Cabinet over the new subsidies program do not conflict.
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.
The initiative is meant to ensure that subsidized products reach those who most need them and are distributed fairly according to citizens’ social and economic status.
Cabinet spokesman Magdy Radi previously told Daily News Egypt that “it would take months or even years to discuss the subsidies program before any changes are implemented.
“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.
Radi who described the program as a “very important and serious issue with social and economic implications added that 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, who are not the target sector of government subsidies.
The government spends millions on subsidizing basic needs and petroleum products, he explained, with an inefficiency rate of around 20 to 30 percent, which “results in a substantial amount of loss.
