The Egyptian government plans to introduce a cash subsidy worth between 200–300 Egyptian pounds ($3.80–$5.70) per person to replace its existing in-kind food ration system, a source at the Ministry of Supply and Internal Trade told Al Manassa.
Under the proposed transition, prices of rationed goods will be pegged to free-market rates, with exceptions made for select basic commodities, the source said.
The move aligns with an announcement by Prime Minister Mostafa Madbouly on Thursday, stating that the government aims to convert the food ration system to cash in the coming fiscal year, which begins on July 1, 2026. Madbouly noted that the necessary studies and procedures to finalize the transition have been completed.
The source, who requested anonymity, said the government intends to keep the number of rationed goods available to beneficiaries at 30, while restructuring the list of products on offer.
The changes would add fresh and frozen meat and frozen poultry, while other items such as tahini halva, biscuits, and salt are being considered for removal.
“Prices of subsidized commodities will be updated according to prevailing market prices, with fixed prices set for some basic and strategic goods, mainly sugar, oils, rice, and pasta, to maintain price stability for beneficiaries,” the source said.
Additionally, the government is seeking to unify the beneficiary database for subsidized bread and food commodities, the source added. Around 72 million citizens currently benefit from bread subsidies, while about 64 million receive subsidized food commodities.
The policy shift coincides with an increase in subsidy allocations for rationed goods and bread in the FY 25/26 budget to about 160 billion pounds, up from 134.2 billion pounds in the previous fiscal year's budget.
However, the government has not yet made a final decision on the total budget allocation for the cash subsidy program once the shift from the in-kind system is complete.
The final cost, the source said, will depend on the final number of beneficiaries after ration cards are screened, the mechanisms for distributing the subsidy across different segments, and whether the bread subsidy is folded entirely into the new cash system.
Under the current system, each person registered in the ration system receives 50 pounds to buy goods sold at ration outlets, where prices are subsidized to keep them below free market prices.
Meanwhile, the Ministry of Supply and Internal Trade suspended several ration cards earlier this month as it began applying four new eligibility criteria for subsidies.
The ministry will start receiving appeals from excluded citizens on June 14, Mohamed Sheta, assistant minister of supply for digital transformation had previously told Al Manassa.
The ministry first established rules to remove ineligible beneficiaries in 2016, gradually increasing the number of exclusion criteria to 14 by 2024, before adding the four new rules at the start of this month.
These eligibility cuts have previously affected millions of ration card holders and drawn public backlash. In 2019, acting on presidential directives, the ministry reinstated 1.8 million people to the ration system to receive goods while allowing any citizen who believed they qualified to file a formal grievance.
