Parliament recommends setting a limit on monetary compensations

The Parliament has voted in favor of recommending the Finance Ministry to set a limit on the maximum value of monetary compensations which the state may award to parties under settlement agreements.

The recommendation is part of the resolution presented by Thulhaadhoo MP Hisaan Hussain to call on the government to establish policies to facilitate monetary compensations without overburdening the state coffers.

The Public Accounts Committee presented its report following the evaluation of the resolution earlier this Saturday. The report passed with the unanimous consensus of 62 parliamentarians this Saturday afternoon.

The report makes six recommendations, the chief of which to instruct the Finance Ministry to amend the Public Finance Regulation to set a limit on the maximum value of monetary compensations and make it mandatory for all state bodies to abide by the limit; and to instruct the Attorney General’s Office to state the limit on all settlement agreements.

Additional recommendations include instructing the Attorney General’s Office to draft a Civil Procedure Code, draft amendments to the Contract Act to incorporate a policy on compensation for termination of contracts, and relevant fines, and draft amendments to the Public Finance Act to make state employees personally liable for losses incurred by the state due to negligence in executing their duties.

The committee also recommended that the Parliament obtain estimates of compensations for individual settlement agreements and conduct separate assessments.

The Parliament’s decision to recommend stricter controls over settlements amid criticism against the government which has award MVR 1.3 billion in settlements to private parties so far this year.