The Anti Corruption Commission (ACC) has ordered the Finance Ministry to cancel plans to buy computers, iPads and phones for government ministries, claiming that only the People’s Majlis can approve ministerial salaries and benefits.
The Finance Ministry on April 30 released a circular approving the purchase of mobile phones, computers, and iPads for ministers from state funds allocated to the respective ministries. Furthermore, the finance ministry said the treasury would cover up to Rf 4000 (US$260) in monthly payments for ministers’ phone bills.
However, the ACC has told the Finance Ministry that no state institution could approve salaries and benefits for its staff, claiming that the task fell under Majlis’ jurisdiction.
“Article 102 of the Constitution authorizes the People’s Majlis to allocate salaries and benefits for the President, Vice-President, Judges, Members of Parliament and staff of the state institutions. Instead of state institutions deciding for themselves on matters within Majlis jurisdiction, we have ordered the Finance Ministry on May 7 to approve such benefits through the Majlis,” an ACC statement read.
“We would like to remind you the Auditor General has repeatedly criticized such actions in his audit reports and called on state offices not to do so without Majlis authorization. Further, when this commission asked the Majlis for advice on phone allowances, the Majlis Finance Committee told us in a letter on 30 March 2011 to act according to the salary structure approved by the Majlis on 28 December 2011 until the Majlis decides otherwise,” the statement noted.
The Auditor General Ibrahim Niyaz last week released a report on the Department of Judicial Administration (DJA) noting that between October 2008 and December 2011, Supreme Court judges had paid their phone bills amounting to RF 281,519 (US$18,280) from the state budget, despite the fact that the parliament had not allocated phone allowances to the judges.
Niyaz has recommended the amount be reimbursed and that the granting of phone allowances be determined by the parliament.
The Supreme Court on 16 May 2011 released a statement claiming that no Supreme Court judge had received phone allowances, after local media accused judges of misappropriating state funds for phone allowances.
Meanwhile, Chief of the IMF mission in the Maldives, Jonathan Dunn, warned parliament in April that if the country does not reduce its expenditure, it risks running out of reserves and miring the country in poverty.
Furthermore, the Majlis Finance Committee last week has projected that the Maldives budget deficit will reach 27 percent of the GDP by the end of year 2012, a 175 percent increase on earlier forecasts.
Government spending in 2012 is expected to increase by almost 24 percent, reaching Rf17.45 billion (US$1.13 billion) at the end of the 2012, while government revenue for 2012 will be Rf2.6 billion (US$168.6 million) less than the projected amount of Rf10.87 billion (US$704 million) – a 23 percent plunge.
With the shortfall of revenue and increased government spending, Head of the Majlis’s Financial Committee, Deputy Speaker and People’s Alliance (PA) MP Ahmed Nazim observed that the budget deficit will exceed from Rf 3.9 billion (US$ 252 million) to Rf9.1 billion this year (US$590 million), amounting to 27 percent of the country’s GDP.
Finance committee member and MDP MP for Kulhudhufushi, Abdul Ghafoor Moosa, told reporters that unplanned spending on police and military personnel and planned reimbursement of civil servants pay cuts in 2010, are both significant causes for rising costs to the government.
He observed that the largest shortfall in revenue is a direct result of the US$135 million pulled out from the budget with new government’s recently revised policy on lease extension payments for resort islands.
Maldives Inland Revenue Authority (MIRA) anticipated receiving a total of Rf375 million (US$ 24 million) for lease extensions, however the income received dropped to Rf23 million (US$1.5 million) as a result of the decision to accept the lease extension fees in an annual installment instead of a lump sum as decided by former administration.
The loss of concession fees from Ibrahim Nasir International Airport (INIA), the result of a successful Civil Court case to block the Airport Development Charge (ADC) filed by the Dhivehi Qaumee Party (DQP) while it was in opposition, also saw the government receive only US$525,355 from the airport for the quarter, compared to the US$8.7 million it was expecting.
The government-aligned PA’s Deputy Leader Nazim however contended that the 23 percent drop in government income was caused by unrealised revenue from privatisation schemes and a shortfall of Rf 166.7 million and Rf435 million (US$28 million) from the projected dividends of Dhiraagu and import duties respectively.