Qatar raises govt salaries

Saudi Ara­bia to hike mu­nic­i­pal fees

Kuwait Times - - FRONT PAGE -

Qatar will raise the salaries of gov­ern­ment em­ploy­ees next year in a rare spend­ing hike by a Gulf state at a time when low oil and gas prices are weigh­ing on state fi­nances. Some Qataris’ ba­sic salaries will dou­ble, un­der a law to be passed in Jan­uary that was pub­lished in Al Sharq news­pa­per late on Sun­day. Salaries for non-Qataris re­main the same. Gas-rich Qatar is the wealth­i­est coun­try in the world per capita and its roughly 300,000 cit­i­zens en­joy free health­care and ed­u­ca­tion.

But plum­met­ing en­ergy prices since mid-2014 have forced the coun­try to rein in lav­ish pub­lic spend­ing at a time when it is hav­ing to fund a $200 bil­lion in­fra­struc­ture up­grade for the 2022 foot­ball World Cup. State sub­si­dies have been slashed and jobs cut at state in­sti­tu­tions, in­clud­ing more than 1,000 for­eign work­ers let go in 2015 at Qatar Petroleum. Cut­backs have hit Qatar’s vast mi­grant work­force the hard­est but lo­cals - for whom af­flu­ence and stel­lar eco­nomic growth have been the norm - have also been af­fected.

Some gov­ern­ment em­ploy­ees have been an­noyed by be­ing told to fly econ­omy class, share of­fices and can­cel jour­nal sub­scrip­tions. Qataris on so­cial me­dia yes­ter­day ap­plauded the law as sup­port­ing cit­i­zens through dif­fi­cult eco­nomic times. Neigh­bor­ing Saudi Ara­bia in Septem­ber cut min­is­ters’ salaries by 20 per­cent in one of the most dras­tic mea­sures yet by the en­er­gyrich king­dom which racked up a record bud­get deficit of nearly $100 bil­lion last year. In 2011, Qatar raised state em­ploy­ees’ salaries by 60 per­cent.

Mean­while, the Saudi gov­ern­ment said yes­ter­day it will raise mu­nic­i­pal fees for ser­vices such as busi­ness li­cens­ing to in­crease rev­enues as its oil in­come sags be­cause of low global crude prices. The new fees, which also in­clude charges for op­er­at­ing telecom­mu­ni­ca­tions tow­ers and banks’ au­to­mated teller ma­chines, will take ef­fect on Dec 9, the Min­istry of Mu­nic­i­pal and Ru­ral Af­fairs said.

But in a sign that the gov­ern­ment wants to limit the fi­nan­cial im­pact on com­pa­nies, many of which are strug­gling with an eco­nomic slow­down, the fees were well be­low ceil­ings ap­proved by the cab­i­net in Au­gust. Also, the min­istry post­poned im­ple­men­ta­tion of in­creases in some fees, such as charges for col­lect­ing garbage and ap­prov­ing real es­tate de­vel­op­ment plans. It was not clear when these might go ahead.

In­vest­ment bank NCB Cap­i­tal es­ti­mated the im­pact on in­dus­tries’ net in­come this year would range from 0.02 per­cent for health­care and 0.07 per­cent for banks to 0.79 per­cent for con­sumer sta­ples and 1.36 per­cent for petrol sta­tions. Telecom­mu­ni­ca­tions op­er­a­tor Eti­had Eti­salat (Mo­bily) will see an im­pact of 3.3 per­cent, it cal­cu­lated. Seek­ing to cut a bud­get deficit that to­talled $98 bil­lion last year, the gov­ern­ment has been com­ing up with a range of new ways to raise rev­enues. In Au­gust, the cab­i­net ap­proved pro­pos­als to in­crease visa charges and traf­fic fines.

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