Tag: subsidy

Bill proposed to raise disability benefits to MVR5,000 a month

MP Ibrahim Muttalib has submitted an amendment to the Disabilities Act to raise the monthly allowance provided to persons with special needs from MVR2,000 (US$150) to MVR5,000 (US$324).

The MP for Fares-Maathoda – who failed to win re-election in last month’s polls – stated in the draft legislation (Dhivehi) that its purpose was to provide financial assistance to families with persons with special needs to seek medical treatment overseas.

While treatment for disabled persons was covered in the government’s ‘Aasandha’ health insurance scheme, Muttalib stated that securing Aasandha in hospitals abroad was difficult for families.

The first reading of the bill took place at today’s sitting of parliament, after which the amendments will be tabled for a preliminary debate.

The Disabilities Act (Dhivehi) was passed in July 2010 to provide financial assistance and protect the rights of persons with special needs whilst a national registry was compiled in 2011 with more than 4,000 active members.

Citing a 2010 report by the Human Rights Commission of Maldives and the UNDP, the US State Department’s 2013 Human Rights Report on the Maldives noted that “most schools accepted only children with very limited to moderate disabilities and not those with more serious disabilities.”

“Children with disabilities had virtually no access or transition to secondary-level education. Only three psychiatrists, two of them foreign, worked in the country, and they primarily worked on drug rehabilitation. No mental health care was available in Male. There also was a lack of quality residential care,” the report stated.

State benefits

Meanwhile, in March, the government raised the old age pensions from MVR2,300 to MVR5,000 a month to fulfil a campaign pledge by President Abdulla Yameen and the ruling Progressive Party of Maldives.

While the government insists that enough funds to provide the increased benefits could be generated by investing in pension funds and financial instruments, critics have argued that, with a MVR1.3 billion (US$84.3 million) deficit budget, the move will plunge the country further into debt.

“These are loans, and taking loans is acceptable to invest in to increasing productivity. But this is not such an investment, this is something the government is spending. Eventually people will have to bear the burden of this,” former Economic Development Minister Mahmud Razee told Minivan News last month.

A World Bank report at the end of 2013 urged the government to reduce spending in order reduce the “unsustainable” public debt which currently stands at 81 percent of GDP, and could rise to 96 percent by 2015.

“Maldives is spending beyond its means and financing the budget risks affecting the real economy,” the report said.

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Subsidy for more electricity consumers from September: Firaq

Electricity usage exceeding 400 units may be subsidised from September, the deputy minister for home affairs Mohamed Firaq told Television Maldives (TVM) on Sunday, reports Haveeru.

The additional subsidies would go to applicants after a review of their financial situation, said Firaq. The government presently subsidises electricity usage below 400 units. “After September, subsidies will be provided to applicants. Usage of below 400 units will be subsidised after an ‘easy’ form is submitted. Subsidies for those who use more than 400 units will be provided after they submit a special application form,” Firaq said. “Sometimes the electricity bill becomes hefty for houses with large families… The new policy aims to provide subsidies to this group.”

The forms are available at STELCO and the National Social Protection Agency.

The government gives some Rf5.5 million as subsidies to STELCO, and the amount would reach Rf60 million by the end of 2010, reports Haveeru. The fuel surcharge would be subsidised.

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Party backlash over 33% boost in electricity prices

The ruling Maldivian Demcratic Party (MDP) have expressed concern over the raised electricity prices in Male’.

“It has always been a vow of the MDP to lower living costs, however at the moment electricity prices are ridiculously high,” said MDP chairperson Mariya Didi.

MDP MP Hamid Abdul Gafoor explained the main issue was the change in the pricing scheme.

“On average, a household will use at least 300 to 350 units of electricity in a month,” he said.

STELCO, the state electric company, recently dramatically increased the price for the first 300 units of electricity. The first hundred units have risen from Rf1.60 to Rf2.25, while the second and third hundred units have risen from Rf .70 and Rf2.15 to Rf2.50 each.

That means the average monthly electricity bill for household has risen almost overnight from Rf545 ($US42) to Rf725 ($US56).

“Many people are assuming we are attacking the government, but we are just voicing the concerns of the people,” Hamid said.

Currently there is a Rf45 subsidy per head per day to help with the cost of electricity for households with monthly incomes of less than Rf9450 ($US735).

“We have to get rid of this mentality that if a house hold electricity bill is high, they are well off,” urged MDP MP Eva Abdulla. “We have to assume that it might just be 12 people living in that household, chipping in for the bill – this is the reality.”

The president’s office issued a statement claiming the government was listening to the concerned MPs.

“We can’t provide additional financial assistance to STELCO – if we did that we would have to start printing money, and this would devalue the ruffiyya,” said the president’s press secretary, Mohamed Zuhair.

Hamid agreed that the solution was not to print more money.

“If we were to print an additional Rf50 million, it would only raise inflation and we would have no control over prices,” he said.

“The MDP wants to increase the subsidy, but there are many issues we need to rethink,” he said. “The figures we are currently using to calculate eligibility for the subsidy is very outdated, so there is research underway to get a ground figure.”

Mariya noted that many eligible households were failing to claim the subsidy.

“We have conducted house-to-house research and found that many people do not have sufficient information about the subsidy and thus have not been filling out their subsidy forms,” she said.

Cutbacks

The government could only boost subsidies if it reduced its current spending, Eva claimed, renewing the government’s controversial calls to slim the administration by reducing the spend on civil servant salaries.

“The government needs to reduce the civil service – offices should only have the required number of employees for optimal performance. Only then will government spending be reduced,” she said.

Civil service spending must be kept “on hold” until the government’s income surpassed Rf7 billion, Hamid said.

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