News

Finance Minister: MVR 2.5B saved from cost reduction steps

Published

5 days ago

27/06/2024

Finance Minister Dr. Mohamed Shafeeg states MVR 2.5 billion has been saved so far this year as a result of the steps implemented by the government to reduce cost.

Speaking at a meeting of the Parliament’s Public Accounts Committee on Wednesday, Minister Shafeeg said the results envisioned with the fiscal reforms and cost reduction steps implemented by the government have now begun emerging.

He emphasized the need to implement additional fiscal reforms in order to undertake the projects wanted by the government despite saving MVR 2.5 billion with the reforms and steps that have already been implemented. He noted that some sectors of the government were producing a significant amount of financial waste and in this trajectory, underscored the need to reform the management of state-owned companies.

While an MVR 49.8 billion budget has been passed for the prevailing year, Minister Shafeeg says significant difficulties will come into play in the future if reforms are not implemented. He said the government had initially planned to implement reforms by mid-year as the government is already facing difficulties in financing the budget.

“However, we had work by implementing reforms from day one; the result of which we are now seeing,” he added.

He detailed that MVR 17 million had been saved per month, to date, as a result of these reforms.

The Minister revealed that the government has begun implementing reforms in the health sector which could save a significant amount of money.

Referring to President Dr. Mohamed Muizzu’s decision to implement a policy focused on cost reduction, revenue growth, and a medium-term revenue strategy during Sunday’s cabinet meeting, Minister Shafeeg said efforts are presently underway to formulate a timeline for the implementation of the agenda.

“Implementing this reform is no longer an option for us, but rather, something necessary,” he stressed.

Henceforth, he appealed for the cooperation of parliamentarians in this endeavor.

Finance Ministry had earlier warned that the budget deficit listed at MVR 14 billion initially in this year’s budget will climb up to MVR 20 billion if expenses are continued without fiscal reforms.

They had announced significant steps to reduce costs in February in light of this, which targeted to reduce expenditure through seven main aspects; promotions to staff, official trips, introduction of new allowances and similar aspects in this trajectory.

Parliament began inquiring about the exact details of state finances after alarms were raised by Deputy Speaker Ahmed Nazim.

Initially, Minister Shafeeg had been summoned to a meeting of the Public Accounts Committee on Monday for the purpose. However, he had been unable to attend that day due to poor health.

Source(s): sun.mv

News

Finance Advisor Munawwar blames previous administration for rising state debt

Published

17 hours ago

01/07/2024

Advisor to the Minister of Finance Ahmed Munawwar has attributed the rise in state debt to the financial mismanagement of the previous administration. He made these comments during a programme aired on PSM News.

Munawwar noted the former government’s greatest failure was its handling of the financial health of state-owned enterprises (SOEs). He criticised the previous administration for increasing expenditures through poor staffing decisions, unmatched pay scales, and a lack of comprehensive project planning.

Munawwar highlighted that by the end of the previous administration, the government’s deficit had reached USD 3.4 billion, translating to an annual shortfall of USD 649 million. He also pointed out that SOEs were operated at excessively high costs, resulting in their collective debt climbing from USD 2 billion at the end of 2022 to USD 6.4 billion by the conclusion of the former government’s term.

Additionally, Munawwar revealed that the total national debt, encompassing both government and corporate debt, stood at USD 12.9 billion at the end of the previous administration.

Munawwar detailed how capital and subsidies paid to SOEs surged under the previous government, rising from around USD 32 million in 2018 to approximately USD 389.5 million annually over the last five years.

He provided specific examples of SOE debt increases: Fenaka Corporation’s debt grew from USD 77.9 million in 2018 to USD 279 million by November 2023. During the same period, State Electric Company Limited (STELCO) saw its debt rise from USD 181.7 million to USD 246.7 million. Additionally, Island Aviation’s debt escalated from USD 64.9 million to USD 259.7 million over the five years.

Source(s): PsmNews

News

Public Accounts Committee recommends removal of MMA Governor

Published

17 hours ago

01/07/2024

Parliamentary Committee on Public Accounts has voted to advise President Dr. Mohamed Muizzu to remove Ali Hashim from his position as Governor of the Maldives Monetary Authority (MMA). The decision was passed by a majority of the committee members who attended the meeting.

The motion to recommend Hashim’s removal was put forward by Deputy Speaker and Parliamentarian for Dhiggaru Constituency Ahmed Nazim. Nazim expressed his belief that Hashim has not been fulfilling the responsibilities associated with the role of MMA Governor.

Nazim outlined the critical functions of the central bank, which include issuing and managing the nation’s currency, determining the international exchange rate of the Maldivian rufiyaa, advising the government on monetary and banking matters, and formulating financial regulations. He emphasised that the central bank’s monetary policy is a vital component of the country’s economic foundation.

The Deputy Speaker criticised the MMA for allegedly failing to support effective monetary policies and for indirectly restricting the issuance of loans by banks and financial institutions. He argued that these policies have led to a reduction in money circulation and a halt in economic activities.

Nazim also noted the domestic market, which is increasingly crucial for government revenue, is not being properly regulated. He highlighted that the MMA has not provided the necessary advice to achieve the objectives outlined in the MMA Act since November 17, 2023.

Emphasising the central bank’s role in the nation’s economic growth, Nazim argued that it is time for new leadership and reformed monetary policies.

Under the Maldivian Constitution, the President has the authority to remove the Governor of the MMA based on the advice of Parliament. Ali Hashim has been serving as the Governor since his appointment on September 8, 2019.

Source(s): PsmNews

News

Crowd gathers outside Parliament, demanding PG Shameem’s resignation

Published

17 hours ago

01/07/2024

A crowd of protestors gathered outside the Parliament building on Monday, demanding the resignation of Hussain Shameem, the country’s prosecutor general, as well as an end to indefinite detention.

The dozens of protestors accused Shameem of committing “inhumane acts” and making “deals” with criminals during the recent Maldivian Democratic Party (MDP) administration, from 2018-2023.

They also accused him of being involved in the Maldives Democracy Network (MDN), which published a report that contained derogatory remarks regarding the religion of Islam and Prophet Mohamed.

“We want PG Shameem to resign immediately, or for parliamentarians to dismiss him, without making any excuses,” said one protestor.

The protestors said they did not was Shameem as the country’s prosecutor general.

They also expressed concern over the death of Mohamed Jameel, a suspect who died at the Maafushi Prison on Friday. Photos taken of his body showed scars and bruises on his face, fueling allegations that he was tortured in prison.

However, the police said that the bruises were believed to be signs of livor mortis, and not that of torture.

The protestors also demanded the delivery of President Dr. Mohamed Muizzu’s electoral pledge to end indefinite detention of suspects.

The 45-year-old inmate who died on Friday had also been held in prison pending the outcome of his trial.

“In response to a question regarding indefinite detention, the president said he was working on finding a legal solution to the issue. We want the incumbent president to end indefinite detention as promised,” said one protestor.

Source(s): sun.mv