Mubarak gives Egypt's public sector 10% pay and pension rise

Two weeks before workers' protest is planned, president announces boost for government employees' wages.

CAIRO // In Hosni Mubarak's first meeting with key cabinet ministers since he returned from surgery in Germany three weeks ago, the Egyptian president announced a 10 per cent rise for government wages and pensions. Egypt's official news agency, Mena, reported that Mr Mubarak ordered all government employees be paid a monthly bonus equivalent to 10 per cent of their paycheques, starting with the new financial year in July. The pay rise seems to be meant to drum up support for his government, which is under criticism for its economic policies.

Mr Mubarak, 81, returned to Egypt in late March after spending three weeks in Germany where doctors at Heidelberg University Hospital removed his gall bladder and what they described as a tumour or growth on his small intestine. He has been recuperating at the Red Sea resort of Sharm El-Sheikh since then and it is there that the prime minister, Ahmed Nazif, as well as ministers of finance, housing and economic development, flew to meet him.

"They most probably discussed the budget and evaluated what had happened in the past few weeks," a cabinet spokesman, Magdy Rady, said in an interview yesterday. The pay rise comes about two weeks before labourers and workers are expected to protest on Labour Day, May 1. They are demanding the implementation of a rise in the minimum wage, which was supported by an administrative court ruling this week, but which the government has so far failed to enact.

Amr el Shobaki, a political scientist with Al-Ahram Centre for Political and Strategic Studies in Cairo, said: "The problem is that such [economic] decisions [by Mubarak] are taken while there is no budget for it. The economic situation is catastrophic and is causing huge inflation." Rabab el Mahdi, an assistant professor of political science at the American University in Cairo, said: "The way President Mubarak is responding is a classical tactic of how populist authoritarian leaders maintain power.

"It's just a way to appease the public sectors, which have the potential to mobilise and disrupt the continuity of his rule." Workers from different industrial groups and companies have spent days, and in some cases weeks and months, camped out on the streets opposite the parliament building. Such mass actions have been the way workers and employees have been able to make any gains in the past few years.

Al Shorouk, an independent daily newspaper, quoted an anonymous source yesterday as saying that the ministerial meeting was designed to show Mr Mubarak on Egyptian TV for the Egyptian people, who have not seen their president since he arrived at Sharm el-Sheikh airport. However, Egyptian TV yesterday only showed a still picture of the president sitting with ministers at a long table, apparently at his residence at the resort.

Mr Mubarak, who has been in power since 1981, never appointed a vice president, and it is not clear if he will run in next year's elections. Since 2004, there has been speculation that he is grooming his youngest son, Gamal, 46, a former investment banker, to succeed him. Gamal Mubarak accompanied his father to Germany and has been with him in Sharm el-Sheikh. The absence of the Mubaraks from the political scene was contrasted by the prominent presence of Mohammed ElBaradei, 67, the former chief of the international nuclear agency, who has caused political stirrings since he returned in February, demanding political reform and constitutional amendments.

It is not clear when Mr Mubarak will come back to Cairo and if he will address workers at May 1, as he usually does. The state-owned media have portrayed Mr ElBaradei, among other things, as an "enemy of labourers and peasants" for saying that the ratio of their representation in parliament is unrealistic. Mrs el Mahdi said: "President Mubarak is appealing to the public sectors, and recently ElBaradei has attempted to approach them. But at the end of the day ElBaradei's support base among the intelligentsia and Mubarak's allegiance and popular base among the businessmen don't represent the majority of Egyptians."

About half of Egyptians live in poverty. Egypt's core annual inflation rose to 7.04 per cent last month, up from 6.9 per cent in February, the central bank said on Sunday, according to Reuters. Meat, poultry and fish as well as fruits and vegetable prices have risen sharply in the past few weeks. @Email:[e-mail] * With additional reporting from the Associated Press