As a staunch lefty, I take a keen interest in the finances of Bahrain. Although the chief cause of Bahrain’s unrest are not financial, they obviously play an important role. Afterall, finances have a significant impact on things like education and health. Access to wealth allows one to improve their life chances and, in the case of the poor, extricate themselves from continued poverty. That is why I was interested in the continued rhetoric that emphasized how protesters were unpatriotic because they were damaging the country’s economy. As I said back in March 2011, ‘an economic argument as a basis for patriotism is only valid if the economic wealth is shared equally by all’. In my opinion, the equitable distribution of a nation’s wealth is fundamental, and it is not the right of one person to enjoy the world’s resources more than another. Thus I believe the vast accumulation of private fortune is inimical to equality and social justice.
Although the level of absolute poverty in Bahrain is low, the level of relative poverty is fairly high (21.9%). Many of the Al Khalifa family enjoy a legacy of wealth that has accrued to them over the years thanks to their extraction of moneys in a number of different ways. Historically, much of this was collected in the form of a “poll tax (raqbiyyah), agricultural corvees (al-su khrah ) and a water tax (dawb) (Fuccaro, 2009: 21).” Many of these taxes were leveled exclusively at the Shiah Baharna. You can read a few of them in the following excerpt compiled by Major Daly in 1922.
It is important to note that not this singling out of the Shiahs should not simply be seen as the mentality of the occupier, but as the ‘inability or disinclination’ for Shaikhs to extract taxation from Sunnis (Daly, 1922). Therefore as both the ruler and many Shaikhs got further into debt, it became necessary for them to engage in more aggressive taxation of the Baharna. This unwillingness to displease the Sunni community through taxation thus created a situation whereby Baharna were further extorted, something Daly noted would lead to ‘ continual disturbances’. Interestingly, the lack of taxation in Bahrain is what many government supporters use nowadays as a justification for Al Khalifa rule.
As the country modernized, revenue from various sources such as customs receipts, pearling licenses, oil royalties etc accrued to the state. A portion of total revenues was (and is still) given to the ruling family. Much like scholars of white privilege argue, it is important to acknowledge the advantages bestowed upon certain groups at the expense of other groups. In Bahrain’s modern history, a large degree of the money that could have gone to education , health and development infrastructure went to those members of the ruling family on the civil list. Members of the ruling family receive an allowance for simply being in the royal family. While this is common practice in monarchies around the world, it’s not something I agree with. I thought it would be interesting to embark on a project exploring the amount the ruling family have received over the past 100 years. In particular, I wanted to explore what percentage of total annual revenue has gone to the Ruling Family over the past century or so.
As far as I know, such figures have not been compiled over such a large period (I haven’t trawled through every annual report yet, though Charles Belgrave occasionally jotted down the percentage of annual revenue allocated to the Civil List). In recent times, the incarcerated Secretary General of the National Democratic Action Society Ebrahim Sharif has been vociferous on the issue of the Civil List/Privy Purse (Civil List – members of the ruling family entitled to a share of national revenue). In 2008 he appeared on Bahrain Television and criticized how much revenue was allocated to the Ruling Family. In particular, he was incredulous at how the amount given to those on the Civil List actually increased in 2001, the year Bahrain was undergoing significant political reform. Sharif also noted that the amount allocated for the Civil List in 2001 was 8.5 million dinars, which represented an increase of 2.5 million from 6 million. This increased in 2002 to 9 million. On 2003, the amount allocated to those on the Civil List was no longer included on the annual financial report, which meant that Bahrain’s elected MP’s, whose responsibility it is to scrutinize the budget, can no longer scrutinize the amount of money given to royals.
Using the date from the Annual Records of Bahrain, I have created created a graph and a table that show the total amount of total annual revenue allocated to the ‘Civil List’. So far I have compiled data from the years 1925 – 1937. I hope to do the same from 1937 onwards.
The mean recurrent expenditure on the ruling family for the time period in question is about 47%, an enormous amount. Bahrain’s annual reports from this period are peppered with concerns about the amount of money allocated to the Ruling Family. It was an annual complaint of Charles Belgrave. Here are a sample:
The first and heaviest item on the expenditure side of allowances to the Ruling Family, which amounts to 4,69,344/- that is more than half the estimated total of the annual Revenue. The amount appears, in my opinion, to be excessively large… (Belgrave, 1927: 44)
Although the financial position is sound the State is spending at present nearly the whole of its annual revenue on recurrent monthly expenditure such as the allowances to the Ruling family which alone adsorb more than half the whole revenue (Belgrave, 1928:65)
If the civil list continues to increase as it has during the last three years, it will in about ten years have absorbed the entire revenue of the State (1929: 87)
Charles Belgrave (1928, pg 76) also commented on how Civil List payments were given irrespective of whether the recipient held a job or not.
this amount (Civil List) does not include salaries which are paid to various Shaikhs, in addition to their allowances, who occupy positions in the govt such as Magistrates, Presidents of Courts, Amirs Etc. These payments are included under other headings, Protection, Judicial etc.
Belgrave also noted that many Al Khalifas owned property, though he also noted that they often charged exorbitant rents whilst neglecting the maintenance of gardens (ibid, pg 77). In 1930 the Civil list was limited to a maximum five lakhs, (500,000 Rupees) (pg124). Following the discovery of oil, 1/3rd of oil royalties were to be paid to the ‘Privy Purse of His Excellency Shaikh Hamad’ (Belgrave, 1935: 505). You can see from the above table how these royalty figures took the total Civil List figure to well above the defined limit of 5 lakhs. Below is an example of one of the budget sheets.
Anyway, I thought the above numbers/tables/graphs might be interesting. The history of a country’s wealth has important implications in modern times, not least because it leaves a lasting legacy in terms of infrastructure and human development. In a global sense, it is comical to see people with vast personal fortunes using arguments like ‘ protesters are damaging the economy’. A final interesting point to note is that the amount allocated to the Civil List barely changed during the economic recession of 1930 – 1935. On the contrary, cuts were made to public services that could have been better made to the Civil List.
To be continued!