DUBAI, Oct 7 (Reuters) - Iran’s parliament voted on Sunday to suspend plans for further reform of the country’s food and fuel subsidies, with legislators citing economic pain caused by the plunge of the rial currency, Iranian media reported.
Subsidy reform has been a centrepiece of the economic policies of President Mahmoud Ahmadinejad, so parliament’s vote was a political blow to the president at a time when he faces growing public discontent over the rial’s slide.
Of 240 members of parliament present, 179 voted for a bill halting the second phase of subsidy reform, while 17 voted against the bill and 20 abstained, according to the Iranian Labour News Agency (ILNA). Final details of the bill must still be approved by parliament, ILNA reported.
The reform aims to ease pressure on state finances by cutting tens of billions of dollars from the amount which the government pays to subsidise low consumer prices for food and fuel, while offsetting the impact on Iran’s poorest citizens by giving them monthly cash payments.