Saudi Arabia cuts ministers' pay by 20%

The measures, disclosed in a cabinet statement and royal decree broadcast on state-run Ekhbariya TV on Monday, constitute the first pay cuts for government employees, who make up about two-thirds of working Saudis.

"The cabinet has decided to stop and cancel some bonuses and financial benefits,” read a line of text on Ekhbariya, as a minister read to assembled ministers and royals, including King Salman bin Abdulaziz, a list of cuts in various grades in the civil service.

The plunge in oil prices since mid-2014 has pushed energy-rich Gulf Arab states to rein in lavish public spending.

Saudi Arabia had a record budget deficit of nearly $100bn last year, forcing it to find new savings and ways to raise money.

A royal decree read directly after the broadcast announced the cut in ministers’ pay. Housing and car allowances for members of the appointed Shura Council will be cut by 15%.

Overtime bonuses were cut to between 25% and 50% of basic salaries, while annual leave may no longer exceed 30 days.

An exception will be made for troops involved in combat along the southern border and abroad as part of an 18-month military intervention led by Saudi Arabia in neighbouring Yemen.

"It’s one more economic measure to balance spending. Of course people don’t like it, but it’s a sign of the times,” Saudi analyst and the editor of Al Arab News, Jamal Khashoggi, said.

"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 told Reuters.