The parliamentary debate on the budget proposed for 2014 began today with MPs of the opposition Maldivian Democratic Party (MDP) calling on the newly-elected coalition government to fulfil its campaign pledges.
MDP MP Ali Waheed urged the new administration to submit its legislative agenda to parliament and incorporate its policies in next year’s budget.
“Very big promises have been made to the people. Our grandmothers and grandfathers want MVR5,000 (US$325) in their accounts at the end of this month, MVR5,000 each, so total MVR10,000 if it’s a couple.
“Each of our citizens want a doctor in our homes at the end of the month [as pledged by the PPM]. They are clearing out the room intended for the guesthouse for the new doctor. Our fishermen are expecting MVR10,000 a month subsidies (US$650). Fishing is not too good right now,” he said.
Referring to the Progressive Party of Maldives’ (PPM) pledges to raise the old age pension and designate a doctor for each family, Ali Waheed said the opposition party would vote for a budget that reflected the campaign promises.
“Our responsibility is to be the people’s eyes in this Majlis. People want us to watch over and hold this government accountable,” the MDP deputy parliamentary group leader said.
Most MPs suggested that the new government should be able to submit a revised budget based on the PPM manifesto.
Speaker Abdulla Shahid explained that amendments brought to the Public Finance Act stipulates that the budget must be submitted by the end of October. Parliamentary rules however allow the government to “include components of their new budget” through the Budget Review Committee, he said.
Reappointed Finance Minister Abdulla Jihad told local media today that the government did not plan to submit a supplementary budget or reduce recurrent expenditure but would propose changes to the Public Sector Investment Program (PSIP).
Jihad stressed that the proposed revenue raising measures should be approved by parliament to finance new infrastructure projects.
The measures include hiking T-GST (Tourism Goods and Services Tax) to 12 percent from 8 percent, revising import duties, deferring abolishing the tourism bed tax for one more year, raising the airport departure charge from foreign passengers from US$18 to US$25, leasing 12 islands for resort development and introducing GST for telecommunication services (currently exempt from the tax).
During today’s debate, MP for Shaviyani Kanditheemu, Mohamed Hussain, who left the Dhivehi Rayyithunge Party (DRP) in April and remains an independent, said there were “serious problems” with the budget and that 2013 was an “empty year” for his constituency.
None of the projects included in the 2013 budget for the islands he represent was carried out this year, he said, while some have been omitted from the 2014 budget.
Former President Dr Mohamed Waheed laid the foundation stones for a new school and mosque in Shaviyani Feydhoo in January, he added, but the projects did not commence and were not included in next year’s budget.
DRP MP Hassan Latheef, who represents the Hithadhoo south constituency in Addu City, said there were no projects for the southernmost atoll apart from establishing water and sanitation systems.
Latheef objected to only MVR45 million (US$2.9 million) allocated for Addu City, which he contended was disproportionate for a population of 32,000.
MDP MP Mohamed Riyaz meanwhile expressed concern with the PPM backtracking on its pledges, by claiming that campaign banners with these promises were put up by supporters rather than the party itself.
PPM MP Abdul Azeez Jamal Abubakur appealed for new sources of revenue and cost-cutting measures to be included in the budget.
Azeez also noted that projects in the 2013 budget for his constituency in Laamu Maavah did not proceed and have been omitted from next year’s budget.
PPM MP Ahmed ‘Redwave’ Saleem urged the government to reduce MVR2 billion (US$129 million) from recurrent expenditure, which accounts for 73 percent of government spending.
PPM MP Abdulla Raheem Abdulla meanwhile thanked opposition MPs for assuring their assistance and cooperation to the new administration.
The PPM deputy leader also said that the budget had to be revised for the PPM to deliver on its campaign pledges. He added that the government would provide the financial benefits that were promised.
“The budget has to be prepared in a way that we can fulfil the promises,” he said.
Several MPs expressed concern with the high recurrent expenditure compared to capital investments. While the projected revenue for 2014 is MVR13.9 billion (US$901 million), recurrent expenditure – wages, subsidies and administrative costs – stands at MVR12 billion (US$778 million).
The budget deficit is estimated to be MVR988 million (US$64 million) or 2.5 percent of GDP, according to the Finance Ministry.