All Oil Revenues Allocated to Essential Goods and Medicine

TEHRAN (Iran News) Speaking before the Majlis on Tuesday, Pourmohammadi presented a comprehensive report on government initiatives to stabilize the economy and assist low-income families. He said that the administration faced two major challenges this year — a 12-day imposed war, which he described as “one of the most significant confrontations in Iran’s modern history,” and a sharp fall in global oil prices.

“Last year, oil sold for around $71 per barrel, but this year it dropped to $51, severely limiting our foreign exchange revenues,” he said. “These two events — war and the oil price drop — have had a direct impact on Iran’s economy.”

Despite these setbacks, Pourmohammadi emphasized that the government had maintained financial stability, ensuring that payments to public sector employees, pensioners, and development projects were made without interruption. “Even under these pressures, spending on infrastructure projects has increased compared with the same period last year,” he noted.

Pourmohammadi said that long-standing financial issues affecting retirees and farmers had been resolved. “The pension equalization problem that caused concern last year has now been fully addressed. We are regularly paying 180 trillion tomans each month to retirees,” he said.

He added that arrears owed to retired teachers from 2021 have been completely cleared and that payments to wheat farmers were made earlier than in previous years. “Even cash subsidies have been disbursed on time — not a single hour late,” he said proudly.

Pourmohammadi stressed that 100 percent of the government’s oil income is being allocated to the import of essential goods and medicine, using the official exchange rate of 28,500 tomans per dollar. “Although this amount is not sufficient, the government borrows an additional $2.5 billion annually to reinforce this allocation,” he explained.

He acknowledged the strain this policy puts on the state budget but said it was necessary to protect people’s livelihoods. “The government is under immense pressure to maintain stability, but despite our efforts, challenges remain in practice,” he added.

The Vice President pointed to inefficiencies in the distribution and pricing systems, noting that subsidized goods often reach consumers at inflated prices. “For example, rice imported at 28,500 tomans per dollar should be sold for 60,000 to 70,000 tomans per kilogram, but consumers are paying 100,000 to 200,000 tomans. The system is flawed — we’re holding ice to hand to the people, but it melts before it gets there,” he said.

He also highlighted inefficiencies in food production, noting that Iran requires 1.9 kilograms of animal feed to produce 1 kilogram of meat, whereas global standards are 1.4 kilograms.

Pourmohammadi argued that current welfare mechanisms are ineffective and outdated, saying: “We spend heavily to support households, but people remain dissatisfied because the benefits don’t reach them properly. Clearly, the mechanism must be reformed.”

He added that subsidies provided at the official exchange rate often end up being sold at free-market prices, indicating deep flaws in trade networks, intermediaries, and bureaucratic procedures.

Pourmohammadi described poverty in Iran as increasingly multidimensional, saying that even though infrastructure in water, electricity, and transport has improved, many citizens still face food insecurity, poor health, limited education, and lack of housing.

He reported that the government currently allocates 940 trillion tomans annually to poverty alleviation and welfare programs — including 600 trillion tomans in direct subsidies — spread across multiple organizations. However, he criticized the fragmented approach, arguing that “a single prescription for all social problems no longer works.”

He urged policymakers to focus next year’s budget on targeted support for the most vulnerable groups, addressing not only income but also education, healthcare, housing, and employment. “The poorest citizens often cannot make their voices heard. We must design programs that truly identify and respond to their specific needs,” he said.

Since the start of the Persian New Year, the government has implemented four rounds of electronic voucher (Kalabarg) payments, Pourmohammadi said.

For income deciles 1–3, each person received 500,000 tomans, equivalent to 2 million tomans for a family of four.

For deciles 3–7, each person received 350,000 tomans, or 1.4 million tomans per family of four.

He emphasized that both large retail chains and small neighborhood stores have been included in the e-voucher system to ensure local shopkeepers are not left out.”Oil Revenues”

Pourmohammadi announced that a new and improved version of the electronic voucher program will be introduced on a trial basis in November.

The new system will feature: Comprehensive coverage — reaching all citizens, from remote rural areas to nomadic communities; Uniform pricing — between five and seven essential goods will be made available at fixed prices nationwide for six months to a year, with any adjustments managed centrally; and Integrated supply chain — stronger coordination between producers and distributors to prevent losses in agriculture and livestock sectors. The government will bear exchange rate and inflation risks by establishing fixed-price contracts with suppliers.

He said the plan is being finalized jointly by government agencies and other branches of power. “This program must be implemented carefully so that essential goods, producers, and distributors are not harmed,” he explained.

“Oil Revenues”

Pourmohammadi acknowledged that the first month of the pilot phase may present some challenges but said these would be reviewed and resolved. “Once we are confident in its performance, we will expand the program nationwide. The goal is to eliminate inefficiency and bureaucracy, and with the parliament’s cooperation, create a modern welfare system that truly improves living standards,” he said.

He concluded by reaffirming the government’s full commitment to the plan: “The leadership and the President personally emphasize the importance of the Kalabarg initiative in every cabinet meeting. This program is not just an economic reform — it is a social promise to ensure stability and fairness for all Iranians.”