Wednesday 6 January 2010

Assembly delays vote on debt bill

Heated arguments between MPs yesterday brought a premature end to the National Assembly session that was due to hold the second and final vote on the multibillion-dinar debt relief plan. The session was first delayed for more than two hours when MPs presented about 10 amendments to the law and asked the financial and economic affairs committee to study them and bring a new report. When the session was resumed, more amendments were presented and its debate created chaotic scenes and heated exchanges between supporters and opponents of the bill.

At this point, speaker Jassem Al-Khorafi adjourned the session for the day when his repeated calls for calm went in vain. Khorafi later told reporters that he was forced to end the session due to chaos and when MPs refused to end their arguments. The arguments were mainly focused on technical details of the controversial bill which calls on the government to purchase around KD 6.7 billion of personal and consumer debts taken by Kuwaiti citizens from banks and investment companies. Under the bill, the government is required to scrap interest estimated at KD 1.5 billion and reschedule the repayment of the principal debt over an extended duration without any interest.

The amendments were technical in nature, the most important of which was not setting a fixed period for rescheduling the debt. The bill only stipulates that the new monthly installment should not exceed 35 percent of the debtors' monthly income. Central Bank governor Sheikh Salem Abdulaziz Al-Sabah later said in a statement that failure to set a fixed duration for repayment would mean that some debts will have to be repaid over periods exceeding 15 years.

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