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Will Rouhani end the $15 monthly handout to citizens?

Five years after its initiation, monthly cash handouts to citizens continue to burden the Iranian government. Will Rouhani finally end this program?
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TEHRAN, Iran — Social justice is not merely about distributing cash handouts among people, as the Iranian government has done under its subsidy reforms since 2010, but it means that authorities should ensure that every citizen fulfills his or her societal role and receives what is due from society. Even if one assumes that the defective practices in Iran — where handouts are given to most of the country's 78 million citizens — have brought about positive consequences for the vulnerable, no academic study has been conducted on the issue to confirm this assumption.

In the past couple of years, the administration of President Hassan Rouhani has been complaining that the controversial subsidy program has hurt the Iranian economy, costing the government 1.9 quadrillion rials ($54.8 billion) since its implementation. The cash payments amount to 455,000 rials ($15) per person per month. While the sum may appear insignificant, it is particularly welcomed by large families in the provinces and the working class districts of the capital, Tehran. For many members of these social classes, average monthly salaries run around 10 million rials ($330) or less, meaning the subsidy payments sometimes constitute a major portion of incomes. Many believe that despite the cash payments, a just distribution of wealth has yet to be secured. Liberal economists are urging the government to be brave enough to abandon the program, while even conservative lawmakers agree that it needs to be revised. Indeed, on Sept. 21 a group of parliament members introduced a double emergency motion to encourage the Rouhani administration to cut the cash handouts in a phased manner by the end of the next Iranian fiscal year, which ends on March 20, 2017. However, they abandoned the proposal under rising pressure from hard-liners.

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