Parliament finally approves 2018/2019 budget

CAIRO – 5 June 2018: Egypt’s House of Representatives approved on Tuesday the general budget for the fiscal year 2018/2019.

The latest decisions of the parliament concerning the increase in wages and pensions were applied and edited on the final draft of the budget.

The Parliament approved on Monday a draft law to raise pensions by 15 percent starting July and to amend the social insurance law promulgated by Law No. 79, 1975.

Article 2 reads that the minimum pension for the insured or eligible pension, in accordance with Law No. 79, 1975, shall be increased from LE 500 to LE 750, including all increases and subsidies.

The total expenditures of wages and pensions recorded LE 270.09 billion, while the expenses of the purchase of goods and services reached LE 60.12 billion.

The new budget targets a budget deficit of 8.4 percent of GDP and investments worth LE 100 billion, up from LE 70 billion in the current budget.

It also targets expenditures of LE 1.41 trillion, GDP growth of 5.8 percent and 88 percent public debt. It is worth mentioning that the budget targets achieving a primary budget surplus.

The total revenues are projected to reach LE 989.2 billion, and taxes and tariff yields allocate to contribute LE 770.3 billion to the new budget’s revenues.

The upcoming budget seeks to lower the unemployment rate to 10.4 percent with an inflation rate of 13 percent.

The new fiscal year, which will start on July 1, is expected to see a fresh round of subsidy cuts that will likely lead to price hikes.

The new budget is set to be the largest budget in Egypt’s history.