MPs reject Kuwait economic rescue package

BLOC REJECTION: A group of three MPs has publicly rejected the stimulus package drawn up by the Kuwait government to bailout banks and private companies. (Getty Images)

The economic stimulus plan drawn up by the Kuwait government has suffered a new blow by being rejected by the Popular Action Bloc, it was reported on Tuesday.

The group, which has three MPs in the Kuwait parliament, has branded the $5.1bn  resuce package for banks and private companies struggling under the current economic crisis as; “an attempt to squander public funds and bail out influential people who committed investment blunders”.

According to Kuwait daily Kuwait Times the bloc has also warned that it will "initiate constitutional means to question the government" if the bill is passed and implemented.

In a statement the bloc said the stimulus package, revealed almost two weeks ago, lacked detail and clarity on the number of banks and companies that needed financial assistance from the government.

It also said the bill gave the government unlimited legislative powers and unrestricted use of public funds – a situation that could cost the country billions of dinars.

The bill had been "tailored to allow the use of public funds to guarantee and repay debts of private companies that are either troubled, have made losses or are bankrupt as a result of mismanagement by their officials,” the statement said.

It was "tailored to serve the interests of influential people and to protect executives who have harmed the companies and shareholders' rights", it added.

The statement went on to accuse private companies operating in the Gulf state of making no social contribution and sacking nationals or forcing them to accept lower pay.

”The shortcomings in the bill and the unlimited use of public funds make us strongly reject the bill and take whatever constitutional measures against it," the statement said.

The bill is currently being reviewed by the National Assembly's financial and economic affairs committee, which met on Monday with the head of the appeals court, Faisal Al Mershed, to review penalties in the bill.

The committee plans to complete the draft law on Thursday and submit its report to the assembly next week.

The Popular Action bloc is made up of Ahmed Al Saadoun, Musallam Al Barrack and Marzouq Al Azmi.

Alone they would not be able to block the legislation but they can file a motion to question the prime minister about it.

The assembly is scheduled to hold its next regular session on Mar. 3, but it is likely that a special session could be convened to study the bill.

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