2014 budget should be decided after election, says former finance minister

Former Finance Minister Ahmed Inaz has questioned the timing of a decision to present cabinet with the projected 2014 state budget less than 10 days before the scheduled re-run of the presidential election.

With the constitution requiring a new president be sworn into office by November 11, 2013, Inaz has told Minivan News that the budget should be decided by a democratically elected government immediately following the election, rather than by the outgoing administration of President Dr Mohamed Waheed.

The claims were made after the Supreme Court last month suspended the run off vote between Maldivian Democratic Party (MDP) candidate Mohamed Nasheed and Progressive Party of Maldives (PPM) rival MP Abdulla Yameen that had been scheduled for September 28.

The country’s apex court later annulled the first round, ruling that 5,600 ineligible votes had been cast.

With a re-scheduled poll just under a week away, the President’s Office has announced that Finance Minister Abdulla Jihad had presented the projected 2014 budget to the cabinet on October 8.

Whilst Jihad was not responding to requests for information, local media – citing unnamed Finance Ministry sources – have reported that the proposed budget is expected to total MVR16.5 billion.

The project spending plan come as the Maldives Monetary Authority (MMA) warned in its latest Quarterly Economic Bulletin that government finances have “further deteriorated in the first six months of 2013” due to a sizeable shortfall in expected revenue coupled with a marked increase in recurrent expenditure.

The economic bulletin revealed that the total government expenditure of MVR6.7 billion (US$435 million) in the first half of 2013 was 8 percent higher than the same period in 2012.

The growth of government spending was “entirely due to the 21 percent (MVR965.3 million) growth in recurrent expenditure, which was partly offset by the 26 percent (MVR440.6 million) decline in capital expenditure during the period”, the report stated.

While the present government had previously anticipated the need for for a supplementary budget after state offices were found to have exhausted their entire annual recurrent expenditure for 2013 by April, the Finance Ministry has instead relied on short-term treasury bills (T-bills) to carry over its debts.

Former Finance Minister Inaz said the present government’s reliance on the sale of T-bills was only delaying moves to address the problems with state spending, while ensuring the cost of lending for both public and private enterprise goes up.

Inaz argued that it should be for the newly elected administration to outline how state spending would be handled to find an “agreeable solution” backed by parliament.

“What I mean by agreeable solution is that in the current political climate, I do not believe there will be a clear parliament majority, so we must learn to talk [between political parties],” he said.

“If we delay, this will only prolong the deficit and kill the tax system completely.”

Long term co-operation needed

The former minister said that during the administration of former President Nasheed – under which he himself served – there had been “reluctance” to talk with the country’s opposition.

He added that the same opposition had for their part worked to try and stymie financial measures such as proposed tax reforms that he said had nonetheless been partially introduced by the MDP in the form of the Tourism Goods and Services Tax (T-GST) and general GST.

Having spoken with the current presidential candidates, Inaz argued that there was a shared interest in finding a solution to current concerns over the size of the country’s budget deficit, but argued against what he called the short and medium-term revenue raising measures previously suggested by the current government.

“It will take long-term strategies rather than looking for short-term solutions to try and increase revenue. We must push more cash into the economy and take less money from banks,” he said.

“We cannot increase taxes much more at present, so I believe the smartest way forward would be on focusing to increase productivity. For instance, the revenues in 2011 [from taxation] were way above what we had expected at the time.”

While Inaz said he backed greater efficiency within the civil service and private sector as a key means of boosting revenue, he claimed that significant cuts to recurrent expenditure was not realistic at present.

He took the example of the previous MDP government’s attempts to reduce state wage bills, which he said had required redundancy packages that would not be affordable in the current financial climate.

However, Inaz claimed that any potential government should instead consider freezing current civil service numbers and not hiring any more public sector workers unless a vacancy arose, something he claimed had again been started by the MDP in 2012 before the controversial change in government in early February of the same year.

Former Economic Development Minister Mahmood Razee – another significant figure in the former MDP government – said that it was vital that parliament agree to implement a complete and comprehensive reform of the current taxation system.

Razee argued that the previous government had predicted that once its tax reform plans had been fully implemented to include measures such as income tax, there would not be any need to increase taxes like GST and T-GST as the Majlis previously had this year.


High Court rejects Jumhoree Party’s case contesting election result

The High Court has rejected a case filed by the Jumhoree Party(JP) seeking the release of the voters list and result sheets in the first round of presidential elections held on Saturday, in which its candidate Gasim Ibrahim polled third by just over one percent.

In a short statement, the High Court said the case did not fit the situations stipulated in article 64 of the Elections Act of 2008. Under provision 17(f) election regulations, the Elections Commission (EC) cannot release this information without a court order.

While local and international election observers have broadly praised the conduct of Saturday’s presidential elections, Gasim has contested the results and called for a criminal investigation of the Chair and Vice Chair of the EC for allegedly tampering with the outcome.

Gasim Ibrahim declared at a press conference yesterday that he would not accept the results released by the EC, contesting that the vote had been rigged and that his party’s officials had come across several discrepancies during the ballot.

The presidential poll showed the opposition Maldivian Democratic Party (MDP) candidate former President Mohamed Nasheed finishing at the top of the race, securing 95,224 votes (45.45 percent while Progressive Party of Maldives (PPM) candidate Abdulla Yameen securing 53,099 (25.35 percent) to finish second.

Gasim Ibrahim finished the race at third place securing 50,422 votes (24.07 percent) while incumbent President Mohamed Waheed Hassan received 10,750 votes, finishing last with 5.13 percent of popular vote.

The EC has maintained that the commission did not consider the complaints credible while Vice Chair of Elections Commission Ahmed Fayaz described the accusations levied against the commission as “ridiculous” and “baseless”.

In a press conference on Tuesday – shortly after filing the case at the High Court – Jumhoree Party (JP) MP Ahmed Ilham said that the party will not let the Chair of the commission Fuwad Thowfeek “do whatever he wants with the votes” while everyone had been talking about the importance of “nationalism and Islam”.

“We have our dogs inside Elections Commission. By dogs, we mean informers who inform as about what is going on inside the Elections Commission. Don’t you dare touch a single ballot paper inside there, we will chop off the hands of those who do so,” said Ilham.

Gasim’s spokesperson Ibrahim Khaleel told the press that the party will not back down and would do everything it can to seek justice “even if the commission goes on to hold the run-off election.”

“The Head of State must call for a nation-wide investigation in order to maintain the credibility of the entire electoral process,” said Khaleel.

Khaleel also lambasted the Vice Chair of Elections Commission Fayaz Ahmed, whom Khaleel alleged was sharing confidential information with personal friends.

“Following a meeting with us and the Elections Commission, this Fayaz had told his friends that we talked to the members of the Elections Commission very rudely. Does he have to tell his friends that? What kind of professionalism is this?” Khaleel questioned.

“How come the meeting minutes of Elections Commission are being shared among his personal friends? You don’t take matters of work to home,” he added.

Khaleel also alleged that Elections Commission have “begun a special operation to cover up their wrong doings and fraud”. He also appealed the police to intervene and “help the people get justice”.

Khaleel also echoed similar sentiments as his party leader Gasim Ibrahim, who claimed that he should have finished the race in first place, had the election been “not rigged”.

“We have a team of highly trained campaign experts who consist of PhD holders and other intellectuals who have been trained by Gasim Ibrahim. We also had international experts on our team. The team had estimated that Gasim would gain at least 68,000 votes even in the worst case scenario. We know there is something wrong. We will uncover the whole plot,” Khaleel said.

JP MP Ilham called on the members of Election Commission to “honourably resign” and allow police to intervene and investigate the matter.

“I urge all commission members who did not partake in this scandal to come out to media and tell the public that they are ready to allow police to intervene and investigate. If you don’t do so, you will forever be labelled as traitors who betrayed our beloved nation,” Ilham said.

JP’s alleged discrepancies

The discrepancies which the JP alleges include: double voting, votes cast in the name of people who died prior to the election, inaccurate voter registry, lack of transparency during ballot counting, election officials being biased and aligning themselves towards MDP candidate Nasheed and PPM candidate Yameen.

Speaking during a rally held last Monday, Gasim claimed that 20,000 people had bypassed the rules and regulations and cast their votes “unlawfully”.

The resort tycoon also said that he had obtained more than 70,000 votes during Saturday’s election, but claimed the EC had reduced the number to 50,000.

If the EC had not done so, Gasim  claimed, he would have been leading the poll and MDP candidate former President Nasheed would have been trailing behind him. Gasim alleged that the EC robbed JP of 20,000 votes and gifted them to the MDP.

“I will never forgive this atrocity carried out by the Elections Commission. I will never forgive them ever,” Gasim said, during the rally.

Gasim also called on the members of the EC to “resign and go home” if they were unable to execute their duties.

Reflecting on the court case, Gasim said that he hoped that the High Court and the Supreme Court would not refuse to give him and his supporters the justice they were seeking.

“My plea to the court is to speed up cases filed regarding these critical issues. To look into it and give a just judgement. I don’t believe the courts will decide wrongly on this matter,” Gasim said.

The JP leader also noted that it was too early to talk about coalitions, but the party would decide of this after the matter of its defeat was decided in the courts.

“Currently, there are no candidates that I should endorse,” Gasim said. “By the will of Allah, Gasim Ibrahim will be sworn in as the next president on November 11.”

Meanwhile, during the same rally, former deputy leader of PPM Umar Naseer – who backed Gasim in the poll – accused the commission of giving MDP members 30,000 additional ballot papers to tamper with the outcome of the election.

EC was “well prepared” for poll, say international observers amidst accusations

Despite the allegations, international observers have broadly praised the conduct of Saturday’s election, notably the peaceful voting throughout the day and preparedness of the Elections Commission.

“It is clear that the Elections Commission was logistically well-prepared for this election. Election material was distributed in time to the atolls and overall the process was well-administered. It was positively noted that significant majority of polling officials were women,” read a statement given by the former Prime Minister of Malta Dr Lawrence Gonzi who led the Commonwealth’s observer group.

Meanwhile J M Lyngdoh of the Indian team of election observers stated that the “polling was orderly and unblemished by any notable incident. It was also an enjoyable experience for the voter.”

“The voters’ lists were accurate and prominently displayed. The ballot boxes were opened and closed as per the scheduled time. The discipline, patience and dignity of the voter and the sheer competence, industry and cheerfulness of the election staff were quite admirable. The police were ubiquitous but discreetly non-intrusive,” Lyngdoh noted in his statement.

The US also congratulated the Maldives on the conduct of the first round of voting with US State Department Deputy Spokesperson, Marie Harf noting that “The very high voter turnout showed the strong commitment of the people of Maldives to democratic government”.

Local NGO Transparency Maldives – who ran the most comprehensive observation operation on the day – had earlier announced that none of the incidents reported on election day would have a “material impact on the outcome of the election”.

Transparency Maldives Communications Manager Aiman Rasheed said in 14.5 percent of ballot boxes where controversy occurred during counting, these would not have impacted the overall outcome of the first placed candidate.

As neither of the four candidates who contested in Saturday’s election were able to obtained the required ’50 percent plus one vote’ to secure a first round election victory, the Elections Commission has announced that a run-off election will take place on September 28.