Journalists ask for government subsidies

The Maldives Journalist Association (MJA) has sent a letter to parliament asking for media subsidies to balance the “fragile” state of the country’s media.

The letter urged parliament to provide the subsidies “in a sensible way” to “vitalise” Maldivian journalism, in order for it to continue its “important role” of holding the government accountable.

Several newspapers have closed down while others have reduced staff numbers and salaries, it said, as a direct result of the government moving its advertisements to an in-house gazette.

“Moreover, MJA has been receiving complaints that there are many obstacles to practicing responsible journalism,” the letter read, adding that subsidies were necessary “to protect and preserve independent journalism in the country” and that failing to provide them “would have an adverse effect on this burgeoning democracy”.

President of the MJA and editor of the newspaper Haveeru, Ahmed ‘Hiriga’ Zahir, proposed that media outlets be given subsidies based on circulation, in a similar system to the way political parties are funded.

“A small community [like the Maldivian media] won’t survive unless we are given support,” he said, adding that this money would not compromise the media’s independence if it was allocated by the state rather than the government.

“We have 300,000 people [in the Maldives] and that’s not enough of a market for fully private enterprise,” he argued. On the other hand, “state TV should be privatised to ensure it has a commercial component. Until recently most of the time people relied on the 8pm news on TVM (Television Maldives) to get their information, and now so much of it is biased towards the current government.”

Hiriga said he was also concerned that fully privatising media ownership would consolidate control in the hands of a few wealthy individuals.

There are no provisions in the current budget for media subsidies, although this has yet to be passed by parliament which has stalled the process at committee level, citing various concerns and “confusions”.

Chairman of the budget review committee, MP Ahmed Nazim, told Minivan News last week that there were no subsidies for the Maldives National Broadcasting Corporation (MNBC) included in the budget.

“Can TVM [Television Maldives] and VoM [Voice of Maldives] finance their 2010 operations on their own? Surely not,” he said.

State Finance Minister Mohamed Assad said the government was “not closed to the idea of state-funded media”, but did favour corporatisation of the sector.

“The whole idea of corporatisation is to budget your own operation and not to rely on support,” he said, claiming this made the media less independent “as its income is hidden.”

He said he was concerned at the way parliament was interceding on the budget, and suggested that “we seem to be moving more to a parliamentary rather than presidential system of government.”

“We are proceeding with the budget and have not said otherwise,” he said, adding that there were contingency plans in place “because in the worst case scenario the government still has to operate. Parliament can’t bring the government to a standstill by not passing the budget.”

He dismissed the concerns of the review committee and said parts of the document were “highly technical and misunderstood, [for example] whatever is earned this year will [only] show up as next year’s income,” he said.

“I think Nazim just wanted a break, it was as simple as that.”


Budget falls short of development pledges: DRP

The Dhivehi Rayyithunge Party (DRP) has expressed regret over the proposed 2010 mid-term budget, which it argues will fail to deliver on the development pledges of the incumbent government.

The largest opposition party said the budget had a deficit of Rf4.7 billion (US$366 million), noting that while Rf7.2 billion (US$560 million) is expected in revenue, this was accounted for 60 per cent of the budget.

“It is further doubtful that the revenue goals could be reached since a large part of the income rests upon taxes to be levied under laws that would be made in the future,” a statement from the party said.

Addressing MPs last week, Finance Minister Ali Hashim said the government had proposed a number of measures to generate around US$354 million to plug the deficit. These included foreign aid, foreign loan assistance, privatisation of government companies and the sale of treasury bills through the Maldives Monetary Authority.

In their statement, the DRP further noted that Hashim said government revenue depended on three new taxes, legislation for which was currently pending in parliament.

But, the party continued, the Rf3.4 billion (US$265 million) expected in tax revenue in next year’s budget was only three per cent higher than tax revenue in 2008.

Last week, Hashim urged MPs to pass the taxation legislation before the end of the year and said a goods and services tax would be imposed on tourist resorts and hotels in the final quarter of 2010, which he anticipated would raise Rf358 million (US$27 million) in revenue.


The party further noted that at Rf333 million (US$26 million) revenue from profits of government companies was significantly lower than 2009 because of the government’s policy of selling off state assets.

DRP pointed to the government’s decision to sell seven per cent of its stake in the highly profitable Dhiraagu, the country’s first telecommunications company, to British company Cable & Wireless for US$40 million.

“We believe that another reason for the decrease of income from government companies is handing over management of these companies to unqualified people for political purposes,” their statement said.

Since coming to power, the government has introduced a policy of public-private partnerships it hopes will enhance the efficiency of state-owned enterprises.

Beyond the 40 per cent deficit, another of the issues raised by the DRP was the lack of funding for large development projects such as a national university,

“The extraordinarily high government expenditure casts doubts on the government’s talk of reducing expenditure,” the statement said, further claiming that a large portion of the total expenditure on government employees, Rf3.9 billion (US$304 million), would be spent on political appointees.

Even with the reduction of civil servants’ salaries and dismissals, expenditure on salaries is higher than previous years, the DRP said.

In August, the government announced a raft of austerity measures to help alleviate the budget deficit. These included pay cuts of up to 20 per cent for civil servants and all political appointees ranked deputy minister and above, cutting back on foreign trips, and letting go of all government-rented buildings.

Both the president and the vice-president also volunteered to take a 20 per cent pay cut to their salaries.

Despite a high number of political appointees, the government continues to maintain that it has made fewer appointments than the former administration.

“Benefit for the people”

In their statement, the opposition party described the interest on loans as “alarming”, noting that compared to Rf279 million (US$22 million) in 2008, the amount raised from interest in 2010 will be Rf529 million (US$41 million).

The party said that while the government’s policy was to reduce the size of the government, the proposed expenditure in 2010 will be higher than in previous years.

The DRP further pointed to the increase in foreign debt from Rf755 million (US$59 million) in 2008 to Rf1,057 million (US$82 million) in 2010, adding that the interest rate had not been revealed.

“Our only hope is that this mid-term budget will be amended for the benefit of the people and the country and pave way for development. We give full assurance to the beloved people that we will do everything we can in parliament,” the statement concluded.

Speaking to MPs at parliament, Hashim said that by the IMF government finance statistics measure, the deficit for 2009 was 26.1 per cent.

But, he added, if the mid-term budget was implemented, although there would be a decline to 14.8 per cent in 2010 and 2.4 per cent in 2011, it will reach a surplus in 2012.

Hashim said the structure of the budget was agreed upon after consultations with the International Monetary Fund and recommendations by the Asian Development Bank and the World Bank.