The Endless Ifs and Buts of Equity Shares
Equity shares are a form of subsidy that was established by Mahmoud Ahmadinejad’s subsidy-focused government, and were supposed to provide economic relief to low-income individuals. However, these shares have now become a problem for both the needy and successive governments.
Registration of those who missed out on equity shares was supposed to take place in June of this year, but officials say it will definitely happen in July.
The Deputy Director of Management Development and Resources at the Organization for Welfare said that this year only individuals covered by the Relief Committee and the Welfare Organization can register to receive equity shares. He stated: “New beneficiaries do not need to provide documents for registration, as their lists will be submitted by the National Welfare Organization to the privatization organization so that after completing legal and administrative procedures, equity shares will be paid to them.”
In the original “equity shares” plan, a portion of shares from specific state-owned companies were to be sold to lower-income groups. This plan was approved by the cabinet in February 2006.
In the first phase of equity share distribution to some individuals covered by the Relief Committee, the Welfare Organization, and unemployed veterans, certificates were given to beneficiaries as equity share documents. The value of these certificates was initially 500,000 tomans in shares, which later increased to one million tomans.
In November 2006, Mahmoud Ahmadinejad described the distribution of equity shares as a “major transformation” that would lead to “fair distribution of state wealth among different social classes.” Under the pretext of equity shares, the government was allowed to transfer 80 percent of shares of large state factories and enterprises to the private and cooperative sectors and distribute share dividends to the people.
Ali Tayeb Nia, the Minister of Economy in the eleventh government, believed that equity shares and their implementation left 62 economic enterprises without proper ownership.
In mid-January 2017, the Tehran Stock Exchange announced that the dividend income from equity shares of 60 participating companies totaled 199 billion and 15 million rials. However, governments deposit only a small amount of this dividend annually to the accounts of individuals who have successfully registered in the relevant systems.
On June 1st of this year, the Privatization Organization announced: “It will deposit the dividends from equity shares for the years 2019 and 2020 into shareholder accounts.” According to Mahmoud Hasanlou, the technology director of the Central Depository Company, equity shareholders who held one million tomans in equity shares received or will receive dividends of approximately one million and 70 thousand tomans, and individuals holding 532 thousand tomans in shares received or will receive approximately 580 thousand tomans.
Farsi News Agency believes that over the past sixteen years, approximately 50 million people have received equity shares. However, the head of the Privatization Organization in the Raisi government said that “we still do not have an exact number of those who missed out on equity shares, because a proper definition of those who missed out has not been provided.” This is while it was previously stated that the number of those who missed out on equity shares was approximately 20 million people.
Source: Voice of America
