Bahrain MPs are threatening to veto a government bailout of Gulf Air unless their demands for annual payouts for Bahraini families are approved.

Parliament was notified yesterday that the Cabinet had refused a proposal to pay families BD100 ($265) on each of the two Eids, as well as BD100 at the start of the school year.

Parliament second vice-chairman Shaikh Adel Al Ma'awada said MPs would only agree to a BD664.3 million rescue package for Gulf Air if the payments they were seeking for families were accepted.

'Either they include our demands for this allowance or we will stop their bailout package and instead use the money for other highly awaited schemes,' he said.

It is understood that the Eid and school payouts would add an extra BD43.5 million to the government's spending every year.

Parliament was due to vote on the proposed rescue package for Gulf Air yesterday.

However, the bill was withdrawn by chairman Khalifa Al Dhahrani after parliament's financial and economic affairs committee urged MPs to vote against it.

A new vote will now take place within two weeks after the same committee has reviewed the airline's spending plan for the first year, which is due to be submitted to parliament tomorrow.

The committee has been set a two-week deadline to review the plan, but its report on the proposal could be presented to MPs during an extraordinary session next Wednesday.

Al Dhahrani cancelled yesterday's scheduled vote following a high-level meeting with top government officials on Monday. – TradeArabia News Service