Kuwait pushes ahead with scrapping expat subsidies

Draft law to go to parliament to increase charges facing expats for some public services

(Photo for illustrative purposes only)

(Photo for illustrative purposes only)

Kuwait’s plans to increase expatriate charges for public services such as electricity and water have moved a step forward, with the government introducing a draft law to parliament.

A number of Kuwaiti legislators argue the Gulf country wastes KD4 billion ($14bn) subsidising essential services for expats. The country spends KD6 billion on such subsidies annually.

The proposal is expected to gain traction in the parliament, with eight independent MPs also calling for the change in March.

They want Kuwaiti nationals to receive the services free and expats to pay full price.

It is not clear what the government draft law proposes.

Announcing the draft law on Wednesday, Minister of Cabinet Affairs Sheikh Mohammad Al-Abdullah Al-Sabah said expats subsidies were “a burden on the state”.

Other GCC countries, including the UAE, already limit subsidies for expats while providing for nationals.

Expats make up about two-thirds of Kuwait’s population of 3.8 million people.

The move could increase the average electricity bill for an apartment to as much as KD100 ($350) per month – more than the salary of many expats who work in low paid jobs, such as maids.

Electricity is charged at two fils per kilowatt hour, a tiny proportion of the 38 fils it costs to produce, while power prices have not increased since the mid-1960s, according to Kuwait Times.

The price of fuel also has not increased for 15 years and is one of the lowest in the GCC. The government says it spends more than KD1bn annually in fuel subsidies.

The proposal follows a growing list of ideas from politicians targeting expats.

The Ministry of Social Affairs has announced a plan to cut expat numbers by 100,000 annually over the next decade, while in the past week 213 expats have been deported for traffic offences as minor as running a red light on more than one occassion.

The parliament also is considering increasing expats’ fees for medical services including medical checkups, surgeries and x-rays, it was revealed in March.

While lawmakers also have approved designating specific hours of the day that nationals and expats can seek medical assistance, in what some described as racist.

Under the plan, only Kuwaitis are allowed to attend hospitals and clinics in the morning, while non-nationals are treated only in the evening. Staff also are segregated according to their nationality, while emergencies would be excluded from the plan.

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Posted by: Ahmad

Expats are not dependent only on Kuwait's jobs. Expats are skillful people and they are getting payed for serving the state of Kuwait.Expats are here to earn their living and also have improved the economy of Kuwait.Kuwaiti citizens are finally getting awake. But most important fact they should remember is their past when the camels and humans used to drink water from the same place. It was the expats who came and discovered the Oil for them. After oil discovery and improvement in their economy they are turning their back on us all expats. If they will try to kick off all the expats. Soon their countries economy will go down and it will be just like another Somalia. Are all the locals ready to tackle this change. Can all the locals work as a barber, mechanic, taxi driver, salesman, mandoob and many other odd jobs. Not only that are all the locals ready to take responsibility of key positions where lots of skills and experience is required.

Posted by: Hassan

Expat, what does expat mean! What I know

An individual person being employed willingly, for a structured job & contracted with official means and remunerated with all legal status fulfilled.

Mindset is being floated, as if money is wasted for no return. First of all its the Kuwaiti population ( Local + Expat + Other ). Then comes the second part, should Govt reduce the subsidies or not. Anyone got electricity meter connected should pay, what ever they decide.

Don't segregate charges on the basis of being local or expat.

Posted by: Laith

Kuwaitis should learn from developed GCC states like the UAE. Scaring away the expats wont improve the economy like what they're expecting.

Posted by: Kuwaiti Cowboy

I believe Kuwait has forgotten everything the expat population and the rest of the international community has done for them let alone during the time of the Gulf War.
There should be a mass exodus of expats and then the Kuwaiti economy will crumble. There will no longer be any oil wells drilled or operated, civil services will deteriorate...the downfall of Kuwait has already begun

Posted by: Darrill

I was in Kuwait on business last week and they ran out of gas at the gas station, and I thought, "this is only the beginning". They must diversify away from the oil and their entire society is ravaged by inefficiency, which does not say much for the expats that work there, so maybe as the oil starts to run out, the Kuwaitis will have a wake-up call and think, " Maybe we should have refined our foreign business laws and developed our nation on par with the rest of the GCC. They really do need the CORRECT foreign expertise to perform at a professional level to assist them in the development process.

Posted by: Hany

Expats are the backbone of Kuwait's economy.

The bigotry of some government officials and parliamentarians is very disappointing. Segregation? Limited access to healthcare? Deportation for minor mistakes?

Obviously the concept of equality is quite unheard of in government circles.

Frankly, expats should not pay for the Kuwaiti governments corruption, political instability, slowed economic growth and failed government economic plans. Placing the burden on expats -who are doing all the real work- and bribing local nationals into submission will not help Kuwait in the long-term.

Address your economic issues, but not by singling out one group of people and burdening them with insurmountable payments.

Bigotry is not the solution.

Posted by: Monkey Tennis

Given changing workforce demographics is not achieved over night this will probably have two effects; higher turnover of blue collar workers - the demand will still be there and the supply certainly is; and substantial wage inflation in the white collar sector to attract professionals to an increasingly unattractive living environment; that or the quality of those professionals will diminish (yes, I know, hard to believe it could get worse etc... etc...). The proverbial sledgehammer is being swung...doesn't mean of course the nut doesn't need to be cracked.

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