Wage Hike for Saudi Army Staff
Saudi Arabia will raise wages for most of its army staff, a move that follows a surge in inflation and the Kingdom's first military engagement in almost 20 years against rebels in Yemen.
At about $41 billion, military expenditure accounted for some 33% of the Saudi budget last year, according to the finance ministry's website.
A weekly cabinet meeting chaired by King Abdullah approved a proposal to raise wages for all soldiers as well as senior officers such as Generals and Lieutenants. Defence Minister and also Crown Prince Sultan did not attend the cabinet meeting.
The wage increase would be the second for the army since 2008 when Saudi Arabia offered state employees a 15% wage hike spread over a 3-year period.
The cabinet did not specify when the raise would take effect and what was its percentage. The Defence Ministry's spokesman General Ibrahim al-Malek declined to comment.
The Kingdom does not provide statistics on its military forces. Diplomats estimate various corps of the Saudi army to number a total of 175,000.
The rise in wages is likely to at least match the 5.1% inflation rate of 2009, said John Sfakianakis, Chief Economist at Banque Saudi Fransi.
Saudi inflation climbed to a 17-month high of 6.0% year-on-year in July, well above rates seen in other Gulf countries fuelled by rising food and housing costs.
Much of the army's budget is spent on salaries but a surge in oil receipts in recent years raised the amount of funds available for the military and catered for more purchases of equipment and weapons.
The 2010 budget allocated SR154.8 billion ($41.28 billion) to national security and defence, unchanged from its level in 2009, but almost twice its level in 2004.