Egypt to Shift to Cash Support System Starting Next Fiscal Year

Egyptian Prime Minister Mustafa Madbouly announced the commencement of transitioning to a cash-based subsidy system instead of in-kind support starting from the next fiscal year, describing this move as a qualitative shift in the method of delivering subsidies.

During the weekly government press conference held at the new administrative capital, Madbouly emphasized that the state does not aim to reduce the total subsidy allocated to citizens in the general budget. He stressed that the primary objective of this change is to address existing shortcomings in the current system, achieve the highest levels of social justice, and optimize the use of available resources.

Details of the Subsidy Reform Plan

The transition from in-kind support to cash assistance is one of the most prominent economic and social reform issues discussed by the Egyptian government in recent years. This effort aligns with the state's goal to improve public spending efficiency and ensure direct subsidy delivery to eligible groups.

Currently, in-kind subsidies mainly rely on the ration card system, which provides basic goods and subsidized bread to millions of citizens. In contrast, cash subsidies involve granting beneficiaries direct financial amounts based on specific criteria related to their level of need.

Government Coordination and Beneficiary Classification

Madbouly explained that the government maintains near-daily coordination with ministers and relevant entities to finalize the technical and organizational studies related to the shift to cash subsidies. He noted that this issue undergoes extensive discussions with experts and specialists to ensure the best implementation mechanisms.

The current plan under development divides beneficiaries into several categories according to their economic and social need levels. Those most in need will receive the highest cash support amounts, while less needy groups will obtain smaller sums through a gradual system designed to ensure fair distribution and prevent subsidy leakage to ineligible individuals.

Addressing Inflation and Public Communication

The prime minister highlighted that the government considers challenges related to inflation rates and preserving beneficiaries’ purchasing power. He affirmed that all feedback and opinions regarding the new system are subject to careful study and follow-up.

Madbouly added that the government will hold a dedicated conference after completing all technical and organizational details to explain the implementation mechanisms and respond to citizens’ questions. He confirmed that the ultimate goal is to direct the majority of support to the most vulnerable groups to achieve the greatest possible social impact.