Saudi Arabia is tightening a crackdown on illegal foreign workers in the kingdom, giving the Ministry of Labour more powers including the right to distribute financial rewards to inspectors who turn up violations.

The decision is one of a string of adjustments to economic regulation and the policy-making aparatus since King Salman took the throne in January. Earlier this month, in his first big speech since coming to power, Salman said creating private sector jobs for young Saudis was one of his main goals.

To achieve this, the government has since 2011 been trying to limit the number of foreign workers in the country - about 10 million - and press companies to hire more local citizens through measures such as a quota system and fees.

It has had some success; the number of Saudis working in the private sector jumped to 1.5 million by the end of 2013 from 681,481 in 2009, according to the government, and well over a million illegal foreign workers have been forced to leave the country.

The latest powers given to the labour ministry suggest King Salman wants to intensify the pressure on employers. The ministry will now have authority to prevent work permits from being renewed if companies do not follow guidelines on hiring more Saudis, the Saudi Gazette quoted an official statement as saying late on Monday.

If firms close down or halt the specific activity for which a foreign worker was hired, work permits will be considered as terminated - a step to prevent firms from hiring foreigners on a pretext and then transferring them elsewhere.

Also, the ministry was authorised to give financial rewards to officials who detect labour law violations during inspections. Total rewards should not exceed 25 per cent of fines collected, the statement said without elaborating.

The unemployment rate among Saudi citizens was 11.7 per cent last year, official data shows. Another major social problem is a lack of affordable housing; the cabinet on Tuesday approved a proposal to tax undeveloped land in an effort to push more land onto the market, making it available for home-building. – Reuters