Manama: In a press conference held at Gudaibiya Palace, the Government today announced a package of Cabinet-approved measures to curb government spending, raise new revenues, and protect key subsidies for citizens, following a Cabinet meeting chaired by Crown Prince and Prime Minister Prince Salman bin Hamad Al Khalifa. The announcement confirmed that electricity and water prices will remain unchanged for the first and second tariff bands for citizens' main homes, which include extended families. Plans to redesign household utility support have been put on hold for further study, while price changes for other user categories will take effect from January 2026.
According to Bahrain News Agency, the measures build on progress under Bahrain's Fiscal Balance Program, which saw non-oil revenues more than double between 2018 and 2024, while recurring government spending was reduced, supporting steady economic expansion. Over the past two decades, Bahrain's gross domestic product increased fivefold from approximately USD 9 billion to USD 47 billion, with average wages for Bahraini workers more than doubling, and inflation remaining comparatively low relative to major advanced economies.
The measures align with Bahrain's Economic Vision 2030, supporting expenditure discipline and revenue diversification beyond hydrocarbons, ensuring long-term fiscal sustainability while shielding households from cost-of-living pressures. Key measures announced include reducing administrative expenses by 20% across all government entities, increasing contributions from government-owned companies to the general budget, and referring draft laws to impose taxes on local companies and increase levies on soft drinks.
Additional measures aim to enhance the utilisation of undeveloped investment lands, introduce fees for sewage services excluding citizens' primary residences, and review worker permit and healthcare fees, with domestic workers exempted. The Cabinet also announced plans to adjust natural gas prices for companies and develop a mechanism for determining fuel prices, with gradual implementation starting in 2026.
Furthermore, the Cabinet confirmed that electricity and water tariffs for citizens' primary residences will remain unchanged, postponing changes to subsidy mechanisms until further study. Efforts to streamline government procedures to attract foreign investment and strengthen the private sector's role were also highlighted.