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| Saudi Arabia unveils first public sector pay cuts | Saudi Arabia unveils first public sector pay cuts |
| (about 5 hours later) | |
| Saudi Arabia has unveiled pay cuts for government employees for the first time, as it attempts to further rein in spending at a time of low oil prices. | Saudi Arabia has unveiled pay cuts for government employees for the first time, as it attempts to further rein in spending at a time of low oil prices. |
| A royal decree said ministers' salaries would be reduced by 20%, and housing and car allowances for members of the advisory Shura Council cut by 15%. | A royal decree said ministers' salaries would be reduced by 20%, and housing and car allowances for members of the advisory Shura Council cut by 15%. |
| Lower-ranking civil servants will see wage increases suspended, and overtime payments and annual leave capped. | Lower-ranking civil servants will see wage increases suspended, and overtime payments and annual leave capped. |
| About two-thirds of working Saudis are employed in the public sector. | About two-thirds of working Saudis are employed in the public sector. |
| Their salaries and allowances accounted for 45% of government spending in 2015, or $128bn (£99bn), and contributed to a record budget deficit of $98bn. | |
| 'Back to time of poverty' | 'Back to time of poverty' |
| BBC Middle East analyst Sebastian Usher says the unspoken contract that once existed between ordinary Saudis and the ruling elite - in which citizens could all but expect a none-too-stressful job for life in return for accepting the status quo - has long been eroding. | BBC Middle East analyst Sebastian Usher says the unspoken contract that once existed between ordinary Saudis and the ruling elite - in which citizens could all but expect a none-too-stressful job for life in return for accepting the status quo - has long been eroding. |
| But, our correspondent adds, the deficit highlighted the urgent need for change. | But, our correspondent adds, the deficit highlighted the urgent need for change. |
| In April, Crown Prince Mohammed bin Salman unveiled a reform plan intended to reduce the government's spending and lessen its dependence on oil revenue. | In April, Crown Prince Mohammed bin Salman unveiled a reform plan intended to reduce the government's spending and lessen its dependence on oil revenue. |
| The "Vision 2030" initiative aims to cut the public sector payroll to 40% of the budget by the start of the next decade and boost private sector employment. | The "Vision 2030" initiative aims to cut the public sector payroll to 40% of the budget by the start of the next decade and boost private sector employment. |
| The government also cut the generous subsidies for petrol and utilities in December, but complaints prompted Prince Mohammed to sack the water and electricity minister six months later. | The government also cut the generous subsidies for petrol and utilities in December, but complaints prompted Prince Mohammed to sack the water and electricity minister six months later. |
| Some Saudis have already taken to social media to lament what they remember as better days under King Abdullah, who died last year. | Some Saudis have already taken to social media to lament what they remember as better days under King Abdullah, who died last year. |
| "God be with the citizens, we are back to the time of poverty," wrote Rayan al-Shamri on Twitter. | "God be with the citizens, we are back to the time of poverty," wrote Rayan al-Shamri on Twitter. |
| Jamal Khashoggi, editor of Al-Arab News, told Reuters news agency: "It's one more economic measure to balance spending. Of course people don't like it, but it's a sign of the times." | Jamal Khashoggi, editor of Al-Arab News, told Reuters news agency: "It's one more economic measure to balance spending. Of course people don't like it, but it's a sign of the times." |
| "Probably the teachers and many others will be affected by it. It shows why it's important for the private sector and Saudi GDP to diversify," he added. | "Probably the teachers and many others will be affected by it. It shows why it's important for the private sector and Saudi GDP to diversify," he added. |