TEHRAN Dec 9 A powerful legislative body sees
problems with a proposal to reform Iran's costly food and energy
subsidy system and will send the draft law back to parliament
for more work, a spokesman was quoted as saying on Wednesday.
"The subsidy reform bill has been studied by the Guardian
Council and it has some problems with it and it will be returned
to parliament," said Abbasali Kadkhodai, a spokesman for the
12-member body, the official IRNA news agency reported.
Kadkhodai said he would give further details at a news
conference on Saturday.
Last week, President Mahmoud Ahmadinejad reissued a threat
to withdraw the plan to gradually remove energy and food
subsidies, after parliament passed it to the Guardian Council
for final approval.
Ahmadinejad and parliament have disagreed over control of
the money saved through the reform. Some MPs had predicted that
the bill would be returned to the assembly, saying it could pave
the way for a compromise with the government.
Ahmadinejad, who faced widespread opposition protests after
his re-election in June, wants to save up to $100 billion
annually from subsidies on gasoline, natural gas, electricity,
water, food, health and education.
The gasoline savings could reduce consumption and lighten
the blow from any future Western sanctions over Iran's disputed
nuclear energy programme that target fuel imports.
Last month, Ahmadinejad appeared to have won a free hand
from parliament over how the government spends the money saved.
He has threatened before to remove the reform -- which
successive Iranian governments have failed to tackle -- if his
hands were tied over spending.
State media have said the government will open bank accounts
for 36 million people, about half the population, to give them
cash to compensate for the higher food and energy prices.
Critics say the government's reform plan will hurt many
ordinary Iranians already struggling to cope with rising
(Reporting by Reza Derakhshi; writing by Fredrik Dahl;
Editing by Ruth Pitchford)