Fourteen offices able to meet deadline to reduce budgets

Ministry of Finance has said that Ministries and state institutions have not cooperated with the Ministry’s efforts to reduce budgets of government offices by 15 percent.

Permanent Secretary of Ministry of Finance Ismail Shafeeg said in an interview with Sun Online today that 14 offices were able to submit reduced budgets before the deadline of 20 June.

No decision had yet been made on which action to take against the offices which failed to meet the deadline.

“I cannot say that we have the support of the offices in this matter. I believe that those institutions which have not reduced their budgets, should do so,” Shafeeg said.

The state income and expenditure statement published by Finance Ministry weekly shows that 35 offices, including independent institutions and Ministries, are included in the budget.

Shafeeg said that several Ministries have expressed difficulties in reducing budgets, due to having to reimburse employees from this month onwards for salary reductions. He noted that some percentage will be deducted from those offices as well.

“We are halfway into the year, and several offices have had to make payments which were not included in the budget. They have indicated that it is difficult to reduce the budges due to these reasons. We will nonetheless try to deduct some percentage,” Shafeeg said.

The government estimates that about MVR2 billion can be saved if all government offices reduce their budgets by 15 percent. So far, MVR6.7 billion of the budget has been spent on government offices.

The cabinet made the decision to reduce budgets by 15 percent on 22 May.

Ministry of Finance has estimated that the budget of MVR14 billion proposed for this year will end up at MVR18 billion, which is a deficit of about MVR3.4 billion. IMF has expressed concern over rising state expenditure in the Maldives, with the deficit estimated to increase to 27 percent.