On Sunday the government unveiled a social-protection package worth 40 billion Egyptian pounds (about $850 million), billed as a cushion against the relentless rise in prices. For the 4.7 million families enrolled in the Takaful and Karama cash-transfer schemes, however, the arithmetic is less comforting than the headline.
Ahmed Kouchouk, the finance minister, said 4 billion pounds ($85 million) would finance a one-off bonus of 400 pounds (about $9) during Ramadan and Eid. The gesture will reach millions. Yet an examination of past increases suggests that such uplifts have tended to chase inflation rather than outrun it. In nominal terms transfers have risen briskly. In real terms they have scarcely budged.
Launched in 2015, Takaful (solidarity) and Karama (dignity) are conditional cash-transfer programmes designed for poor and vulnerable households. The former targets low-income families with children; the latter supports the elderly and people with disabilities. Since 2022 monthly payments have nearly doubled in pound terms. After adjusting for inflation, however, Karama beneficiaries are only around 0.5% better off in real terms, leaving low-income households under mounting pressure even as the state expands nominal spending on social support.
State budget data shows that past increases in Takaful and Karama payments have mostly tracked inflation. In other words, higher pound amounts have often restored only part of what price rises had already wiped out.
To measure that erosion, Al Manassa adjusted payments using the July consumer price index for each year, then converted the results into constant 2018/2019 prices to compare purchasing power rather than nominal value.
Critics argue that the politics of such bonuses may matter more than their economics.
“While some people may benefit from the Ramadan bonus, its political outcomes outweigh the social impact,” said Mai Qabeel, a researcher at the Egyptian Initiative for Personal Rights. “The cash assistance scheme is largely offset by declining support to key public services and subsidies, such as healthcare.”
The scale of need remains daunting. According to 2019 national census data, nearly 29.7% of the population, or about 31.4 million people, lived below the poverty line. Coverage of Takaful and Karama has expanded substantially, but many of the poor remain outside the net.
Under the 2025/26 budget, monthly Karama payments range from 705 to 884 pounds ($15–19). The maximum basic Takaful payment is 648 pounds ($14). These sums look modest beside independent estimates of subsistence.
A 2024 study by the Egyptian Initiative for Personal Rights (EIPR) put the poverty line for a family at 7,180 pounds a month ($146) to cover basic needs for food, housing, clothing, education, healthcare, and transportation. It estimated the extreme-poverty line—insufficient income to secure basic food—at 2,200 pounds per family. Adjusted for inflation, that threshold had risen to 4,420 pounds by March 2024, underscoring the widening gap between the support provided and the cost of meeting basic food needs.
The Takaful and Karama program accounts for roughly 1% of total government spending, while the child pension accounts for just 0.003%.
Hania Sholkamy, associate research professor at the Social Research Centre of the American University in Cairo and a key expert who led the program’s launch, told Al Manassa in July that the initiative is “insufficient” on its own and needs to be “developed” alongside alternative social protection mechanisms.
However, she said, the government must continue to “prioritize those most in need” given current fiscal constraints.
In April 2025, President Abdel Fattah El-Sisi issued Law No. 12 of 2025 on social security, known as the Takaful and Karama law, which introduced strict eligibility conditions for state support.
The law defines Takaful as conditional cash assistance for citizens without access to social insurance and who are unable to support themselves or their families, including cases of disability or old age.
The government’s latest package adds billions more to the ledger. Whether it adds much to the purchasing power of Egypt’s poorest is another matter.
