KUWAIT : The National Assembly yesterday overwhelmingly passed an amendment to the housing law that stipulates raising government's subsidies on building materials for Kuwaitis to KD 30,000 per each family building a house. The bill's passage came after the government told MPs that the increase will not have to be repaid but is free for all citizens who received a housing loan from the government to build their homes. Initially, MPs had insisted that the government raise the housing loan from KD 70,000 to KD 100,000 and that the increase should be paid in cash to citizens. Under the law enacted in 1993, the housing loan is a soft loan that is repaid to the government in easy instalments over a period exceeding 50 years. After waiting for several years, the government provides Kuwaiti families with a piece of land, a loan of KD 70,000 and subsidized building materials worth KD 10,600. After the amendment, the loan will remain the same at KD 70,000, but the amount of subsidies will be increased to a maximum of KD 30,000, effectively increasing housing benefits by around KD 20,000. Forty-nine MPs, including all Cabinet members present, voted for the amendment while MP Ali Al-Rashed abstained. The amendment was passed in the first and second reading and sent to the government for implementation. MPs are still insisting that two more issues – raising the children's allowance from KD 50 to 75 per month and raising the housing allowance from KD 150 to KD 250 monthly. The government has warned that it will not accept any of the draft laws because they will constitute a huge burden on the budget. Commerce and Industry Minister Abdulmohsen Al-Mudej said the government arrived at the proposal with the Assembly's financial and economic affairs committee and the amendment is more profitable for citizens. He said that increasing the housing loan to KD 100,000 would only increase the debt of citizens who will continue to repay the debt over a very long period of time. The minister insisted that it will be much better for citizens to receive all building materials required by them at a highly reduced rate, adding that the amendment has raised the area of a house that can receive state subsidies from 600 sq m to 750 sq m. The amendment states that the extra subsidies will be given to citizens who have obtained the housing loan and those who are already building their homes. During the debate and before the government told MPs that the increase in the subsidies is a grant and not a loan, MPs insisted that the government must increase the housing loan to KD 100,000 or at least allow citizens to choose whether to take the increase in cash or in the form of subsidies. But after learning that the increase is a grant, MPs overwhelmingly supported the proposal. The government had warned that the KD 30,000 loan increase would cost state coffers around KD 6 billion, warning that this and other proposed increases would pose serious risks to the country's finances. MP Riyadh Al-Adasani said that the housing problem in Kuwait is "manipulated" to benefit real estate merchants, saying it is unbelievable that the price of a square meter hit KD 1,000. Adasani said the price of land in Kuwait is almost double the prices in other Gulf states, including Abu Dhabi and Dubai . MP Mubarak Al-Harees said that the housing loan of KD 70,000 was raised in 1993 and since then, it has remained unchanged, while the price of land and the cost of construction more than doubled. Assembly Apeaker Marzouq Al-Ghanem then adjourned the session until Feb 4 . By B Izzak All rights reserved.
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