Iran widens cash handout cancellations

Iran has cancelled cash handouts to another one million wealthy citizens who received the monthly allowance as part of the targeted subsidy program. 

They will not receive the stipend at the end of the current month on August 22, joining the ranks of the first one million well-off Iranians and those living abroad who were dropped off the program before, Labor and Social Welfare Minister Ali Rabiei said.

The government has to dole out billions of dollars to the citizens under the program but budget constrains have forced officials to roll back the largesse to those who don’t need it.

Last year, the government launched a nationwide campaign to persuade citizens into voluntary withdrawal and some 4 million Iranians registered to forgo receiving the rolls.

Explaining the process of the cancellations, Rabiei cited a pensioner of an Iranian auto manufacturing company who turned out to be owning several cars and small industrial plants.

“When we cited our reasons for his removal, he told us if he had done a crime in possessing cars and factories. I told him we don’t cancel out subsidies to the criminals but the wealthy,” the minister said on the national television.

The government is under pressure for its budget amid US-led sanctions and lower oil prices, with Minister of Economy Ali Tayyebnia saying the administration was running a debt of about $88 billion to Iranian contractors and the banks.

In May, Iranian motorists saw a monthly allotment of 60 liters of subsidized gasoline canceled.

The program as well as the cash handouts are a legacy of former President Mahmoud Ahmadinejad after he scrapped subsidies for basic goods and introduced a system of compensation.

Fuel prices in Iran are still among the cheapest in the world, which have resulted in a habit of prodigal consumption by many Iranians.

By Press TV