| 11 Aug 2010 |
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'Increase in pensions not making much difference'
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JEDDAH: In spite of a raise in pensions earlier this year, many Saudi pensioners say the increase has made little difference and not helped ease their financial problems.
In March, the Cabinet approved a bill granting Saudi pensioners a cost-of-living allowance amounting to a 5 percent increase this year, which will be increased by 10 percent next year and then 15 percent after three years. Payments began on April 15.
"I used to work as an office helper at a government-run office and used to deliver paperwork from office to office. Now that I have been retired for the past three years, I only receive SR2,000 every month," said Ibrahim Al-Sehali, 58.
"I find it difficult to make ends meet to take care of myself, my wife and two unmarried daughters who are still at home. This is especially the case at this time of the year when the price of rent, food and other items usually increase due to the summer and Ramadan," he added.
Al-Sehali added that although the government has been gracious in approving a cost-of-living allowance, if one were to calculate what he and others receive then the increase is insignificant.
"The 5 percent increase I have been receiving only amounts to SR100, which can easily be spent on buying four or five items at the supermarket and barely helps in covering my annual rent of SR18,000 for which I need to save SR1,500 a month," he said.
Al-Sehali also said that one of his daughters contributes SR700 from her monthly SR1,200 salary. "I do not like to take this money, but I have no other choice," Al-Sehali said, adding that he is currently trying to get a job as a secretary.
According to statistics from the General Organization of Social Insurance (GOSI), 30 percent of pensioners in the Kingdom receive stipends of less than SR2,000 per month, while 64 percent receive less than SR4,000 a month.
Currently there are over 250,000 pensioners who receive SR650 million each month, said GOSI on its website. The site also showed that 40 percent of pensioners spend the majority of their monthly stipends on paying rent.
The growing inflation, which in June rose to a 13-month high of 5.5 percent, has increased costs and placed additional pressure on people. The rate of inflation has steadily been increasing at an average of 0.1 percent each month since the beginning of the year.
He added that 80 percent of Saudis earn less than SR 5,000 a month.
"The only ones," said Al-Sehali, "who will benefit from the increase percentages in pensions are the ones who are already receiving large amounts of above SR10,000 each month, not those who really need it."
By Sarah Abdullah
© Arab News 2010
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