KUWAIT CITY, Aug 16, (KUNA): Salaries in the state budget rose from KD 2.2 billion, in the 2001-2002 fiscal year, to approximately KD 4.7 billion at the end of the 2009-2010 fiscal year, at an annual rate of 9.1 percent, according to a study prepared by the ministry of finance.

Volume of the salaries in the budget grew by more than double during the mentioned periods. Hike in salaries and wages, upto 2005-2006 fiscal year, had stood at the average level of 8.7 percent, compared to 12 percent over the past four years.

They grew, in the 2006-2007 and 2008-2009 fiscal years, by 10.4 percent and 20.5 percent, respectively.
The study noted that the salaries’ hike was warranted to alleviate citizens’ hardships resulting from the record inflation, namely soaring prices of commodities, and was possible due to the hike of the state oil revenues.

On support and transfers’ operations over the past nine years, the study showed that the support allotments in the state budget increased from KD 1.5 billion in 2001-2002 to KD 2.3 billion in 2009-2010, indicating that these allocations grew multiple times.

Average annual growth of support allotments in the budget reached nine percent during the mentioned periods.

The budgets of 2006-2007 and 2008-2009 posted unprecedented growth with regard of support for the public authorities, as a result of the obligations of paying allotments of actuarial deficit of the Public Institution for Social Security. This is shown in the increase of the support for the 2008-2009 fiscal year, where it reached KD 9.5 billion, KD five billion of which was specialized for the social security authority.

The 2008-2009 fiscal year also witnessed noticeable hikes of state subsidies and aid, rising — in 2007-2008 — from KD 85 million to KD 381 million, simultaneously with issuance of the law (No. 28 of 2008) with regard to the disbursement of financial aid to cut cost of living.

Other substantial hikes were recorded, in 2007-2010, in the sectors of supporting labor in non-governmental institutions, in line with the state abidance of improving the staff income per capita in the private sector — thus increasing these allotments by 43.6 percent to lure citizens to be employed in the private sector.
As to the burden of the salaries and the subsidies in the state budget, as compared to the overall oil income, the study showed that they constituted 57. 8 percent, in the past nine years. This proportion dropped from 68 percent in 2001-2005 to five percent in 2005-2010 as a result of the hike of the oil prices.
Burden of the subsidies, proportional to the oil revenues, over the past four years, exceeded that of the salaries, where they reached 28.8 percent, while that of the salaries stood at 23.7 percent.

With exemption of the extraordinary rises, namely financing the actuarial deficit, namely in the 2007-2008 and 2009-2010 years, the salaries and wages remained the number-one burden, as proportionally compared to the oil revenues.

The oil revenues in the state budget constituted some 90 percent of the overall rvenenues. They stood at 83 percent in the budgets of 2001-2002 and 2004-2005 periods — and reached 91 percent in the past years.
As to the growth of citizen’s share from the subsidies’ allocations, the study showed the annual income per capita of the subsidies rose from KD 1,800 in the 2001-2002 fiscal year to KD 2,900 in 2009-2010. The annual per capita income reached KD 3,100 in the past nine years.

The study said that reasonale oil prices, required to cover the cost of the salaries and the subsidies should be in the range of 35-30 dollars per barrel.