Saudi king orders 500-riyal monthly allowance to offset higher electricity and water bills


Official portraits of Crown Prince Mohammed bin Salman and King Salman side by side

Official portraits of Crown Prince Mohammed bin Salman, left, and King Salman, published with a report on the royal order, October 25, 2026. Image: shared by @Boslahbusiness via X [file photo]

King Salman has ordered a new monthly allowance of 500 riyals for Saudi state employees, retirees and social security families to offset higher electricity and water tariffs that take effect on January 1, 2027.

The royal order, issued on Sunday on the proposal of Crown Prince Mohammed bin Salman, came as the Saudi Electricity Company and the National Water Company announced changes to their consumption rates from the start of next year, Arab News reported, citing the Saudi Press Agency. The allowance, about $133 a month, goes to civilian and military employees on the civil service scales and operating programs, to retirees, and to eligible family members of deceased contributors or retirees under the social insurance system. Families on social security will receive a separate 500 riyals a month. The General Organization for Social Insurance later clarified that for the families of deceased contributors or retirees, the 500 riyals is a single amount shared among all eligible family members who receive the pension, Ajel reported. The General Organization for Social Insurance said on Sunday that the allowance will be added automatically to pensions from January 1, 2027, with no application needed, Okaz reported, and the Ministry of Human Resources said social security families will receive their 500 riyals starting with the January 2027 payment, Ajel reported. No date for the first payment to state employees had been announced by Wednesday.

The order also reaches into the private sector. Under the Nitaqat program, which sets the share of Saudi citizens each company must employ, a Saudi worker will count fully toward a firm's quota only if paid at least 5,000 riyals a month, starting six months after the measure begins, and at least 6,000 riyals a year after that. The Ministry of Human Resources said the 500-riyal increase is the same for every employee, regardless of rank, grade or salary, according to a post by @Trendbusiness_.

The tariff changes are significant. The investment bank EFG Hermes expects household electricity tariffs to rise between 17 and 20 percent from January, adding 0.2 to 0.3 percentage points to inflation in that month, Asharq Business reported. Saudi annual inflation was 1.9 percent in September. A widely shared table of the new rates showed the first residential electricity tier rising from 18 to 21 halalas per kilowatt hour, and a sample water and sewage bill for 20 cubic meters rising from 16.96 riyals to 77.63 riyals, figures that Mereja could not confirm against official tariffs and that @SATAMBINS also cautioned needed to be checked against official sources. For shops and businesses, the commercial electricity rate rises to 25 halalas for the first 6,000 kilowatt hours and 35 halalas after that, from 22 and 32, according to @AskAltujar.

The government's message is that the support covers the increase. One example circulated by @albashrish said a family with average consumption would pay about 158 riyals more a month, while the allowance of 500 riyals leaves a surplus. That depends on how much a household uses, and the allowance does not reach Saudis in private jobs, or the millions of foreign workers in the kingdom, many of them from Ethiopia, Egypt, Yemen and South Asia, who will pay the same higher bills.

The order comes in wartime. Saudi Arabia is fighting a widening war with Yemen's Houthis, who have hit Riyadh's international airport and facilities of Saudi Aramco. One Saudi user, @aboalaz1400, wrote that "in light of the current situation of wars and the closing of the straits," a rise in electricity and water prices was "natural in this period," and thanked the leadership for the support.

Some Saudi users on X used the order to ask for more. The account @khubrani2030 urged private companies to add 500 riyals to their employees' basic salaries in line with the royal order. A user in Khamis Mushait, @noctimont, complained that teachers at private schools there are paid 1,500 to 3,000 riyals for full-time work, despite a 2011 royal order that set a higher minimum, and accused school owners of manipulating contracts.

Energy price reform in Saudi Arabia began in 2016, and the kingdom has moved step by step from subsidizing fuel and power toward direct cash support for households, Asharq Business noted. The new allowance follows that path, but it also arrives as the kingdom's budget carries the cost of a war on its southern border and of the defense of the Red Sea, where Egypt's parliament on Monday authorized forces to help defend Saudi territory.

For Ethiopians, the Saudi economy is personal. Hundreds of thousands of Ethiopian workers live in the kingdom and send money home, and changes to the cost of living and to Saudization rules can change how many jobs remain open to them. The new Nitaqat thresholds apply to the pay of Saudi staff, and the changes aim to boost wages and support Saudi employment in the private sector, Arab News reported.

Sources

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