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Saudi King orders extension of ‘cost of living allowance’ for another year

Saudi King orders extension of ‘cost of living allowance’ for another year

The allowance is given to state employees, military personnel, retirees and students to offset rising costs

Saudi King Salman has ordered the kingdom to continue paying a ‘cost of living allowance’ to state employees, military personnel, retirees and students for another fiscal year, the official Saudi Press Agency (SPA) reported on Tuesday.

The kingdom began handing out the monthly allowance in January 2018 to compensate citizens for the rising cost of living after the government hiked domestic gas prices and introduced value-added tax (VAT).

The amount was hoped to help mitigate “the increased burdens for some segments of the population following from the necessary measures which the state took to restructure the economy,” the decree said at the time.

Read: Saudi king orders new payments to offset rising living costs

In its report on Tuesday, the SPA stated that the monthly allowance for cost of living stands at SAR1,000 for state employees and military personnel, while beneficiaries of the General Pension Fund, and the General Organisation for Social Insurance will receive SAR500 per month.

The monthly cost of living payment for the beneficiaries of social security will also stand at SAR500, while benefits received by students will increase by 10 per cent.

The move aims to “address the needs of citizens”, the report said.

The allowances will be handed out for a period of one fiscal year “until the completion of the study of the social protection system”, it added.

In January, it was estimated that the allowance will cost the government about SAR50bn ($13.3bn) this year.

“The allocation of SAR50bn for this decree indicates the leadership’s concern for the people’s comfort and quality of living,” minister of culture and information Awwad bin Saleh Alawwad told the Saudi-owned Al Sharq Al Awsat newspaper at the time.

Read more: Saudi handouts to cost about $13bn

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