The Iranian government has officially launched a comprehensive 15-point support plan amid sustained economic pressure and with the stated aim of safeguarding food security, improving household livelihoods, and enhancing stability and predictability in the national economy.
While full details of the 15 provisions have not yet been made public, officials say that in the first phase, and on an interim basis, a purchasing credit of 10 million rials (about $7) will be allocated to roughly 80 million citizens. The credit for the first four months will be deposited in a lump sum into the account of each household’s designated head.
According to Welfare Minister Ahmad Meydari, eligible individuals will be able, starting from Jan. 10, to obtain essential goods at 260,000 participating shops and retail outlets nationwide without making cash payments. These goods include dairy, red meat, poultry, eggs, rice, cooking oil, pasta, sugar, and legumes.
Despite Meydari’s televised explanations, uncertainties remain regarding eligibility criteria.
He said that while previous rounds of the food voucher program covered around 60 million people, an additional 20 million individuals have been added in this phase, bringing total coverage to nearly 80 million. This includes primarily those who were receiving cash subsidies at the end of the Iranian year 1403 (2023-24). Government employees and retirees, regardless of their income decile, are also included among beneficiaries.
At present, over 70 million people across seven income deciles receive cash subsidies. Based on what Meydari explained, of the roughly 16 million people who do not receive such subsidies, nearly 10 million have now been included in the food voucher scheme, while about seven million remain excluded. Yet, many are still unclear whether they qualify for the voucher.
The government has said that any gradual increase in prices will be offset by a proportional increase in food voucher credit in subsequent phases, with the aim of preserving household purchasing power. Officials say a central objective of the plan is to eliminate foreign-exchange rent-seeking and to prevent sharp currency fluctuations from being passed through to the prices of essential goods.
Core Pillars
President Masoud Pezeshkian said the government is prioritizing two core pillars in implementing the plan: protecting household livelihoods and providing effective support to producers, shopkeepers, and small businesses.
The president stressed that the policy does not seek to eliminate or reduce subsidies, but rather to shift them from the beginning of the supply chain directly to the final consumer, ensuring that any potential price increases are fully compensated and household purchasing power is maintained.
It appears that funding for the food voucher credit will be sourced from the removal of preferential foreign exchange rates. This subsidized dollar rate, which is set far below the open-market rate, has long been used by the Iranian government to control prices of essential goods but has gradually generated rent-seeking distortions.
Under recent government decisions, wheat and pharmaceuticals will continue to receive the preferential rate, while other essential goods, including corn, oilseeds, soybean meal, various crude and vegetable oils, rice, barley, red meat, poultry, and fertilizer, have been transferred to the second trading hall of the Iran Exchange Center, where they are traded at rates close to the free-market dollar.
This comes as markets typically do not wait for support mechanisms to be fully operational. The removal of cheap foreign currency tends to push costs higher immediately, and production and distribution chains often price in these increases in advance, even if compensation through food vouchers is expected weeks later.
Past experiences with price reforms suggest that the gap between a “government decision” and the “market reaction” usually favors the market. In such an environment, even a short delay in crediting food vouchers can translate into a real decline in household purchasing power.
