Report: Khalil Reviews 'Austerity' Budget Plan

Finance Minister Ali Hassan Khalil conducted a comprehensive review of the 2019 state budget after extended meetings with Prime Minister Saad Hariri, the most recent was late on Tuesday in the Center house, in the presence of all political factions represented in the government, al-Joumhouria daily reported on Wednesday.

The daily said Khalil has prepared a budget plan with suggestions to cut spending and an alternate plan without reductions shall agreement fails on the first one.

In the budget plan currently being discussed the deficit may fall from 12 to 9 percent, said the daily. Spending cuts reportedly are to affect the salaries of high earners without impacting median salaries.

The proposal seriously seeks to reduce all high salaries so that there can be no higher salary than the President of the Republic, said al-Joumhouria.

Moreover, there is a proposal to freeze 10 to 15 percent of public sector salaries for two years to be subsequently paid back in installments or calculated manner so that it remains an acquired right for the employees, it said.

Unnamed sources who spoke on condition of anonymity told the daily that a series of meetings were held away from the spotlight before taking the proposed formulas to the Grand Serail.

Some of the meetings were between Khalil and the Director-General of the Ministry of Finance, Alan Biffani, senior officials and the budget division.

Similar meetings are reportedly held almost on a daily basis to prepare a tight budget in order to reduce the state deficit from 11 to 9%.

Suggestions to slash Lebanon’s budget deficit amid reported salary cuts was not welcomed by public sector employees, mainly military retirees, who staged protests on Tuesday and blocked roads in several areas around Lebanon.