JP calls on government to speed up projects included in PSIP budget

The Jumhooree Party (JP) has called on the government to launch projects included in the public sector investment programme (PSIP) approved with the annual budget passed by parliament.

Following a meeting with Finance Minister Abdulla Jihad, JP MP Abdulla Riyaz told the press that a number of projects for which funds were allocated in the PSIP budget had yet to commence, some of which were planned for constituencies represented by the party’s MPs.

The former police commissioner said the party accepted that the government was facing difficulties managing the budget, assuring the JP’s cooperation for passing a supplementary budget to finance the development projects.

After criticising the government’s flagship special economic zone (SEZ) legislation in parliament, the JP reversed its stance and announced a three-line whip in favor of the bill.

The change in the party’s stance closely followed the government’s cancellation of various business agreements made with the JP leader Gasim Ibrahim’s Villa Group.

Following Gasim’s crucial decision to support President Abdulla Yameen’s 2013 presidential election bid, his party joined the ruling Progressive Party of Maldives (PPM) and its ally Maldivian Development Alliance in contesting the March parliamentary polls as part of the Progressive Coalition.

However, the PPM severed its coalition agreement with the JP in May after Gasim stood for post of Majlis speaker despite the PPM fielding its senior MP Abdulla Maseeh Mohamed.

Following the passage of the SEZ bill, the JP has sought reconciliation, whilst President Yameen has signalled that the government was willing to “work together” with the former coalition partner.


Plans revealed for overdue development of IGMH

The US$7 million (MVR118 million) renovation of Malé’s Indhira Gandhi Memorial Hospital (IGMH) is set to end the concerns of patients with no choice but to use the capital’s only public hospital.

Following yesterday’s announcement, dissatisfied users of IGMH – a gift from India – have told Minivan News that they are currently forced to use its services due to the lack of reasonably priced alternatives.

“The state should be able to offer better and more reliable services than this,” said Ahmed Arshad whose father recently passed away while on the hospital’s waiting list for a bed.

“While I am deeply displeased with the services there, I go there because there is little other choice,” said Shahid Ameen, 35.

According to a statement issued by the hospital’s management, the plans – which include a new 11-storey wing – represent the first major development undertaken since the hospital’s construction 19 years ago.

Plans also include renovation of the hospital’s infrastructure and the upgrading of the Villimalé Health Centre to a 15-bed hospital. IGMH’s new wing – set to be finished by December – will be dedicated to prenatal care and paediatrics and the current dialysis centre expanded.

In his capacity as acting health minister, Minister of Defence and National Security Mohamed Nazim has also announced that the government is seeking to employ 225 additional doctors, who will enjoy revised pay structures – the details of which are yet to be revealed.

Current services

Aishath Inas – a 28 year old teacher – welcomes the proposed development, noting that it is currently “very difficult and time consuming” to get services at IGMH.

“There are long waiting lists even to get a bed in the ward, and people need to wait days to get the medical attention they seek,” she said.

Shahid Ameen noted that the current facilities were hard to locate, despite saying he frequently visits the hospital.

“As for getting appointments with specialists – especially those in the Internal Medicine or Orthopaedics department – well, better to just forget about it. You have to stand in queue for hours, sometimes even days, before you can get an appointment,” he said.

61-year-old Shaheeda Mansoor says she avoids going to the hospital if at all possible.

“It costs a bit more, but it is worth the money to go to clinics instead as you can get faster, and more quality services there when it comes to consultations. However, I still go to IGMH to do some tests as those services are rarely available in the clinics,” she explained.


Indian company Renaatus Projects Pvt Ltd will be undertaking the development work which commenced on May 18 and is estimated to be completed within 15 months.

Under the project, the in-patient wards, attached bathrooms, the Intensive Care Unit, operation theaters, labour rooms, emergency room, and the hospital’s basement will be renovated.

Equipment worth MVR4.5 million (US$291,451) has been donated  to the dialysis centre by MedTech Pvt Ltd and Medicom Pve Ltd while a special consultation room will be set up for a recently-recruited specialist in kidney related illnesses.

The new Villimalé Hospital will contain a three-bed labour room, an operation theatre, five consultation rooms, and an emergency services room.

Nazim – who local media reports to be currently heading the Ministry of Health – announced that the state is looking specialists across numerous areas of expertise, including anaesthetists, cardiologists, dermatologists, gynaecologists, paediatricians, and psychiatrists.

At the press conference, State Minister of Health and Family Hussain Rasheed said that the state will complete the hiring of doctors within 45 days, with 91 medical officers to be placed in health centres across the country and specialists assigned to atoll and regional hospitals.


Boskalis committing “environmental crimes” in UNESCO biosphere reserve, says Ecocare

Netherlands based maritime infrastructure company Royal Boskalis Westminster is committing “serious environmental crimes” in the Maldives, a local environmental group has said.

The company – claimed to have the world’s largest dredging fleet –  has come under fire for mining sand from the country’s only UNESCO biosphere reserve in Baa Atoll.

It also failed to build a barrier to prevent excess dredge soil from spilling onto the reef in Baa Atoll Eydhaushi Island – a move that could cause serious damage to the fragile ecosystem.

“Boskalis has to leave the Maldives now,” Ecocare founder Maeed M. Zahir told Minivan News.

The US$ 37 million four-island reclamation project has reclaimed 20 hectares in Dhaalu Atoll Meedhoo Island in March and 33 hectares in Baa Atoll Eydhafushi Island last week. Work is ongoing on Kaafu Atoll Thulusdhoo Island while a date for reclamation in Dhaalu Atoll Kudahuvadhoo Island has not yet been set.

In the two islands where reclamation was completed houses and vegetation on the shorelines were also covered in fine mixture of sand and salt due to the use of the “rainbow technique” which propels soil into the air.

The Health Protection Agency (HPA) has previously said fine sand particles thrust into the air by the rainbow technique could cause lung and respiratory issues.

Housing Ministry complicit

Maeed accused the Housing Ministry of being complicit in Bosaklis’ violation of environmental regulations, noting the Environmental Protection Authority (EPA) had issued several warnings ordering the company to stop unsafe dredging.

“The Housing Ministry’s failure to stop the project means the ministry is pushing Boskalis. By the time, the EPA warnings arrive, the damage is already done,” he said.

Minister of Environment and Energy Thoriq Ibrahim told Minivan News the EPA is investigating the case.

According to Maeed, the EPA had said it will impose a fine on Boskalis, but the agency has failed to do so. He called for the EPA to be removed from the Environment Ministry’s remit and given greater powers as an independent body to prevent violations in the future.

Boskalis began dredging in Meedhoo in March, but the EPA halted the project temporarily for failure to follow procedures recommended in an environmental impact assessment report.

Instead of using pipelines to transport dredged sand to the shore, Bosaklis dredgers propelled sand and salt through the air covering houses and vegetation on the shoreline in debris.

Housing Minister Mohamed Muizz told local media at the time that safety measures would be followed in the future.

However, Boskalis used the same techniques in Baa Atoll Eydhafushi Island, and furthermore, dredged sand from the UNESCO biosphere reserve and transported it to Thulusdhoo Island in Kaafu Atoll for ongoing land reclamation.

Eydhafushi residents spotted a Boskalis dredger carrying sand away from the island this weekend, and raised the issue with the EPA.

Eydhafushi Island Councillor Mohamed Riza said the company had not sought permission from the local government to mine sand from the atoll.

Baa Atoll was declared a biosphere reserve in June 2011. It is the first of it’s kind in the Maldives.

President Abdulla Yameen inaugurated the Thuludhoo reclamation project this morning.


Vice President departs on official visit to Qatar and Kuwait

Vice President Dr Mohamed Jameel Ahmed departed on an official visit to Qatar and Kuwait last night.

Speaking to reporters prior to his departure, Dr Jameel said the main purpose of the trip was to strengthen ties with Arab Islamic nations.

He added that the government was seeking investments from Arab countries in healthcare and housing as well as assistance for development projects.

Discussions would also take place about establishing an Islamic university in the Maldives, he said.

“In addition to this, we will also talk with these countries about providing budget support to the Maldives,” he said.

The vice president was accompanied on the trip by Islamic Minister Dr Mohamed Shaheem Ali Saeed and President’s Office Minister Abdulla Ameen.


President calls on Majlis to expedite revenue raising measures

President Abdulla Yameen has said development projects can only be spoken of after the People’s Majlis passes revenue raising measures.

Yameen said  that in order to speed up the bills, a request for parliament sittings during this recess period had been submitted with signatures of twenty six members of parliament.

“God willing, when the revenue related bills are passed next week the projects in atolls will speed up,he said.

The Majlis in December passed a record MVR17.95 billion budget of which MVR3 billion is to be realised only after the parliament approves revisions to existing legislation.

The measures include hiking Tourism GST from 8 percent to 12 percent, revising import duties, continuing tourism bed tax for one more year, raising airport departure charge for foreign passengers from US$18 to US$25, leasing 12 islands for resort development, introducing GST for telecommunication services, and obtaining resort lease payments as a lump sum.


Finance Ministry asks to transfer MVR650 million from development budget to pay government salaries

Finance Minister Abdulla Jihad sought authorisation from parliament yesterday (April 29) to divert MVR 650 million (US$42 million) allocated for infrastructure projects in the budget to cover recurrent expenditure.

Appealing for approval from parliament’s Finance Committee, Jihad revealed that by the end of the first quarter of 2013, offices have exhausted the yearly budget provided for recurrent expenditure, which includes salaries, allowances and administrative costs.

Jihad warned that government offices and independent institutions might be unable to pay wages or utility and phone bills if funds were not transferred from the MVR 1.8 billion (US$117 million) Public Sector Investment Program (PSIP).

“If not we will see people gathered and queuing outside the finance ministry,” Jihad was quoted as saying by newspaper Haveeru.

Responding to Jihad’s request, Finance Committee Chair MP Ahmed Nazim reportedly said he did not believe such a significant alteration to the budget could be approved at the Majlis committee level.

Parliament broke for a one-month recess yesterday at the conclusion of the first legislative session of 2013.

The Finance Ministry meanwhile issued a circular (Dhivehi) yesterday instructing government offices to cancel all overseas trips for the rest of the year with the exception of study tours, training courses and all-expenses covered trips funded by foreign parties.

The decision was approved by the cabinet as an austerity measure to reduce government expenditure, the circular stated.

Earlier this month, the cabinet decided to delay implementation of new development projects financed out of the state budget due to shortfalls in revenue.

Jihad told Minivan News at the time that infrastructure projects that have not yet started would be postponed in an attempt to ease cashflow issues.

The move followed parliament’s rejection of government-sponsored legislation to raise the airport service charge to US$30, which was among a raft of measures proposed by the Finance Ministry in the estimated 2013 budget to raise MVR 1.8 billion (US$116 million) in new income.

Other measures included hiking Tourism Goods and Services Tax (T-GST) to 15 percent from July 2013 onward, leasing 14 islands for resort development, raising tariffs on oil, introducing GST for telecom services, and “selectively” reversing import duty reductions.

Jihad told local media following the defeat of the bill to raise the departure tax on outgoing foreign passengers that the revenue raising measures were necessary to manage the state budget.

He confirmed to Minivan News at the time that the government was in the process of formulating a supplementary budget to be put before parliament.

Recurrent expenditure

Jihad meanwhile told MPs on the Finance Committee yesterday that the proposed transfer of funds out of the development budget was necessary before a supplementary budget could be submitted.

“If we do not do this we will not be able to manage the budget at all in the coming days,” he said.

Jihad contended that funds under the budget code for recurrent expenditure were running so low because parliament passed the proposed budget with large cuts to that item.

The Budget Review Committee headed by MP Gasim Ibrahim of the government-aligned Jumhooree Party (JP) approved omissions to reduce the budget from MVR 16.9 billion (US$1 billion) to MVR 15.3 billion (US$992 million).

The budget items that the committee made cuts to included overtime pay (50 percent), travel expenses (50 percent), purchases for office use (30 percent), office expenditure (35 percent), purchases for service provision (30 percent), training costs (30 percent), construction, maintenance and repair work (50 percent) and purchase of assets (35 percent).

The committee also instructed the Finance Ministry to reduce an additional MVR 605.7 million (US$39.2 million) from office budgets.

However, the committee added MVR 389 million (US$25.2 million) for infrastructure projects such as harbours, sewerage and water for islands.

Executive authority

Speaking at a function yesterday to inaugurate a Health Trust Fund, President Dr Mohamed Waheed suggested that the present financial constraints on the state was the result of Majlis allegedly abrogating executive powers.

President Waheed claimed that parliament had removed funds allocated for repair work in the budget.

“It has been cut [from the budget]. But equipment still has to be repaired even by transferring [funds] from another budget line. But the finance minister does not have the flexibility to do that as much as he used to have. It is done under the supervision of the Finance Committee,” he said.

The government was consequently facing difficulties in providing essential services to the public, Dr Waheed said.

The president and his cabinet were vested with the authority to run the government by both the constitution and voting public, he observed.

The present situation was however the result of “others trying to run the government” instead of the executive, he contended.

“I think that suffices for what I have to say,” Dr Waheed said.

Meanwhile, MP Abdulla Yameen, presidential candidate of the Progressive Party of Maldives (PPM) – the largest party in Dr Waheed’s ruling coalition – reportedly said at a ceremony last night that it would be difficult to accomodate the government’s request to reallocate MVR 650 million for recurrent expenditure.

Professional opinions

In December 2012, the Auditor General’s Office and the Maldives Monetary Authority (MMA) submitted professional opinions on the US$1 billion budget proposed by the Finance Ministry.

The central bank warned that the projected deficit in the 2013 budget was likely to adversely affect the foreign exchange market and foreign currency reserves while the Auditor General’s Office expressed concern with formulating the PSIP without either a national development plan or population consolidation policy..

Auditor General Niyaz Ibrahim observed that of the estimated MVR 12 billion (US$778 million) of recurrent expenditure, MVR 7 billion (US$453.9 million) would be spent on employees, including MVR 743 million (US$48 million) as pension payments.

Consequently, 59 percent of recurrent expenditure and 42 percent of the total budget would be spent on state employees.

“We note that the yearly increase in employees hired for state posts and jobs has been at a worrying level and that sound measures are needed,” the report stated. “It is unlikely that the budget deficit issue could be resolved without making big changes to the number of state employees as well as salaries and allowances to control state expenditure.”

The Auditor General’s Office contended that “major changes” were needed to right-size the public sector and “control the salary of state employees and expenditure related to employees.”

The report observed that compared to 2012, the number of state employees was set to increase from 32,868 to 40,333 – resulting in MVR 1.3 billion (US$84.3 million) of additional expenditure in 2013.

This anticipated increase included 864 new staff to be hired by the Maldives Police Service (MPS) and Maldives National Defence Force (MNDF), the report noted.

In light of “existing inefficiencies” in the state, the Auditor General contended that hiring more staff for various independent institutions would be “a waste of public funds” as it would divert resources from service provision and development projects.

“Moreover, we note that increasing the number of employees would lead to an increase in office expenses and expenditure on employees’ retirement and pensions, decrease the number of people left to do productive work in the private sector (decrease the labour force), and slow the growth of the country’s economy,” the report stated.

Details of the state’s wage bill included in the report showed that MVR 187 million (US$12 million) was budgeted as salaries and allowances for 545 political appointees in 2012.

In addition, MVR 1.98 billion (US$128.4 million) was to be spent on 18,538 civil servants; MVR 999 million (US$64.7 million) on 6,244 police and army officers; MVR 362 million (US$23.4 million) on 1,455 elected representatives and attendant staff; MVR 485 million (US$31.4 million) on 3,372 employees of independent institutions; and MVR 345 million (US$22.3 million) on 2,714 contract staff.