RIYADH, Dec 14 (Reuters) - King Salman told Saudis on Wednesday he recognised that economic restructuring measures adopted in response to a sharp drop in oil prices were painful, but said they were necessary to avoid long-term damage to the country.
"The state has sought to deal with these changes ... through a variety of measures to restructure the economy, some of which may be painful in the short run but ultimately aim to protect the economy of your country from worse problems," he told the consultative Shura Council.
"Similar circumstances have happened before over the past three decades, forcing the state to cut its expenses, but it emerged from them, thanks be to God, with a strong economy and continuous and increasing growth," Salman said.
In a drastic step to save money, the king in September ordered salaries of ministers and Shura Council members to be cut by 20 and 15 percent, and scaled back financial perks for public sector employees.
The plunge in oil prices since mid-2014 has pushed energy-rich Gulf Arab states to rein in lavish public spending. Saudi Arabia racked up a record budget deficit of nearly $100 billion last year, forcing it to find new savings and ways to raise money.
King Salman also said that Saudi Arabia sees the security of neighbouring Yemen as part of the kingdom's own security, and issued a thinly veiled warning to regional rival Iran not to meddle there.
"We will not accept any interference in its internal affairs or anything that affects its legitimacy (government), or will make it a hub or a passage for any state or party to target the security of the kingdom and the region as a whole," he said, without mentioning Iran by name.
Saudi Arabia is leading an alliance of Arab states fighting to restore Yemeni President Abd-Rabbu Mansour Hadi to power after Houthi rebels aligned with Iran forced him into exile nearly two years ago.
Saudi Arabia accuses non-Arab Iran of trying to expand its influence into Arab countries such as Syria and Yemen, a charge Tehran denies.
Salman also said that Saudi Arabia would continue to work with world powers to achieve world peace. He made no direct reference to Syria, where government forces finally broke rebel resistance this week in the city of Aleppo to deliver a major victory for President Bashar al-Assad in the civil war. (Reporting by Hadeel al-Sayegh, writing by Sami Aboudi; Editing by Mark Trevelyan)