Compensation costs exceeded 96% of the amounts provided for in the 2022 Finance Law

Compensation costs exceeded 96% of the amounts provided for in the 2022 Finance Law

The Compensation Fund has played an important role in preserving the stability of commodity prices, in particular butane gas, soft wheat and sugar, able to adapt with the purchasing power of citizens, assured Mustapha Baitas, Minister Delegate in charge of Relations with Parliament, yesterday, Tuesday, June 28, 2022 in Rabat.

Mustapha Baitas, who answered a central question in the House of Councilors on the Compensation Fund on behalf of the Deputy Minister in charge of the Budget, Fouzi Lekjaa, underlined that these charges exceeded 96% of the appropriations opened under the Finance Law. (LF-2022), noting that the charges for butane gas, wheat and sugar were established during the period from January to May 2022, at approximately 15.4 billion dirhams (MMDH).

He also indicated that the butane gas subsidy charge reached 9.8 billion dirhams at the end of last May, based on an average price of 878 dollars/ton. And to specify that the average of the subsidy charge for each 12 kg bottle of butane gas reached 100 dirhams during the first 5 months of 2022, against a subsidy provided for under the LF-2022 of 50 dirhams, i.e. a 100% increase, with the aim of preserving the internal selling price of the 12-kilogram butane gas bottle at 40 dirhams.

With regard to common wheat, the minister recalled the additional measures adopted by the government to subsidize this material, affirming that on the basis of imported quantities of 23 million quintals and an average subsidy of 135 dirhams/quintal, this measure should cost to the state budget an additional 3.2 billion dirhams for the January-May period. And to specify that the overall subsidy for imported and local soft wheat reached 3.8 billion dirhams during the period from January to May 2022.

Regarding sugar, the minister said that the government has worked to preserve the stability of the selling price on the national market, noting that the cost of subsidy for imported sugar should be 390 million dirhams (MDH ) at the end of May 2022, assuming an average import subsidy of 1,200 dirhams/tonne and an imported quantity of 321,000 tonnes.

With regard to refined sugar, Baitas indicated that the cost of subsidy is planned at 1.4 billion dirhams at the end of May 2022, taking into account a flat-rate subsidy of 2,847 dirhams / tons and a forecast consumption of 500,000 tons, specifying that the overall subsidy for imported and refined sugar should reach 1.8 billion dirhams for the period January-May 2022.

The minister also recalled that the executive has provided additional credits of 16 billion dirhams to cover the additional costs of compensation until the end of this year, adding that the government intends to increase aid to road transport professionals by 500 million dirhams. to 700 MDH, from 1er next July, an increase of 40%.

This measure aims to mitigate the repercussions of fuel prices on those of goods and the transport tariff, he explained, noting that the government monitors the supply of markets and the evolution of product prices. and their quality, as well as to deal with illegal practices (fraud, monopoly and speculation).

Mustapha Baitas, who emphasized the role of the Compensation Fund in preserving citizens’ purchasing power and protecting the national productive fabric, recognized the limits of this system, which consist essentially of targeting all categories, including those that do not need a subsidy.

He thus stressed that the current conditions do not allow to initiate a reform of this fund, in particular with the recent unpredictable upheavals in prices and the concern of the government to preserve the purchasing power of citizens.

In this respect, the Minister indicated that the government is committed to a permanent listening and ready to discuss any proposal to start the said reform, recalling the adoption of the framework law n ° 09-21 relating to social protection which recommends the reform of compensation in order to have the necessary resources for the generalization of social protection, in particular family allowances.

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