MPs ready to halt high-end insurance to reduce expenses

A great number of parliamentarians have expressed readiness to halt medical insurance allocated for them and their family members from ASEAN nations in order to reduce the expenses of the state.

Many parliamentarians have spoken out in support of this on social media during a time when the government has been forced to take several measures to reduce expenses.

In this regard, Baarah MP Ibrahim Shujau said he is supportive of halting the existing insurance plan for parliamentarians and instead make a switch to Aasandha scheme which is available to the general public with immediate effect in support of President Dr. Mohamed Muizzu’s national efforts to reduce government expenditure.

Eydhafushi MP Ahmed Saleem also supported the remarks, adding parliamentarians have to set an example.

Ruling PNC’s Central Hithadhoo MP Ahmed Azaan also said parliamentarians must set down an example in the current administration’s efforts to improve its financial state.

“In this regard, the medical insurance allocated for parliamentarians and their families from ASEAN nations should be halted. Parliamentarians should not receive insurance that is unavailable to the general public at the state’s expense,” he added.

PNC’s South Mahchangolhi MP Musthafa Hussain also repeated these sentiments. He added that he will recommend reducing the salaries of parliamentarians in order to set down an example as parliamentarians in these difficult times financially.

Musthafa expressed readiness to vote in favor of such a proposal.

Parliamentarians’ salaries were increased at the conclusion of MDP administration. Moreover, the total number of parliamentarians has increased in the current 20^th assembly, at 93.

The general public have always criticized the high expenses to pay the salaries of parliamentarians alongside their allowances and insurance.

The Maldives' debt risks and vulnerability have been mounting, while World Bank in its most recent review warned the island nation of rising public debt, and recommended the urgent need for a comprehensive fiscal adjustment program.

In May this year, it was reported that the country's debt had risen to MVR 126 billion by the end of the 2024 first quarter.

 Erdem Atas the World Bank Country Economist and Resident Coordinator for Maldives, has called for immediate expenditure cuts to overcome its current economic vulnerabilities

In a statement on X, Atas said that the economic vulnerabilities Maldives is now facing are a combination of debt stock accumulation in the last 10 years.

Besides this, he said that the continuous high fiscal and current account deficits over the same period also negatively impacted the country's economy.

Meanwhile, Fitch Ratings - a global credit rating agency - had downgraded the Maldives' long-term foreign-currency Issuer Default Rating (IDR) from 'B-' to 'CCC+' in light of the risk associated with rising external debt coupled with weakening foreign reserves, external financing and liquidity metrics.