Challenges for Iran’s national budget
Tehran, Iran, March 7
By Mehdi Sepahvand - Trend:
The Planning and Budget Organization of Iran recently published a report in which it elaborated on the challenges facing the country’s national budget.
The main challenges are workforce inflation, rising annual expenditure, cash subsidies, and unfinished projects.
Some 3.5 million people are hired to work for the government, while there are also about 5 million retired employees, which should be paid every month.
The cash subsidy payments also has been affecting the government for a number of years. Each month, the government should pay about 34 trillion rials ($1.05 billion, each USD at 32,404 rials) to people as cash subsidies. The government has so far paid over 2.5 quadrillion rials as cash subsidies. A study by the Parliament’s Research Center indicates that the cash subsidies have not helped fight poverty.
On another front, the government still has unfinished projects, and they
require some 4 quadrillion rials to finish.
Qolamreza Shafei, deputy head of the Planning and Budget Organization, has said there are 70,000 unfinished projects in Iran, adding if credit is to be allotted for them like it is being now, it will take 10 years to finish these projects.
Iran’s development budget for the current fiscal year (to end March 20) stands at 570 trillion rials. However, history has shown that due to deficit, the government has been able to realize only half of each year’s development budget over the past few years.
Another problem afflicting the government is debts. Minister of Economy Ali Tayyebnia has recently said the government owes 6 to 7 quadrillion rials to creditors.
The problems do not end there. The government of Iran still has to deal with such issues as drought, water shortage, air pollution, unemployment, guaranteed purchases, and crisis over pension funds.