MDP urge revised budget with bigger allocations to councils

The opposition Maldivian Democratic Party (MDP) on Sunday has urged the current government to resubmit the state budget with bigger allocations to council bodies in line with the Decentralization Act.

In a statement the opposition party released, MDP said that the Decentralization Act which came to effect in 2010 during the party’s presidential administration has been a crucial piece of legislation. The party said it had improved the scope of decentralization in 2018, under its second presidential reign, by enhancing financial sustainability to the council bodies.

Under the party’s most recent presidency, the then government amended the Decentralization Act to allocate a set percentile from the state budget to the council bodies; and as such, block grants were allocated to these local governance authorities.

In 2021, the state allocated MVR 1.3 billion in block grants, MVR 1.6 billion in 2022, and MVR 1.8 billion in 2023.

MDP also said that with the supplementary budget added by the current government for 2024, the budget indicates a total allocation of MVR 2.2 billion to council bodies.

“With that said, it was expected that the initial budget, proposed by the PNC government which came to power in 2023, would be higher than the previous years, it should be noted that the total allocation for council bodies for next year is MVR 1.4 billion,” MDP said.

The opposition party alleges the government has deceptively reduced the legally mandated block grant amount with the aim of handicapping the local governance bodies financially.

“This party would like to highlight that the decision to reduce allocations to councils is indicative of the ruling party parliamentarians attempting to devolve the decentralized system in the Maldives back to the former system,” the opposition party added.

MDP further sad that several council bodies have been raising concerns about some of the legislative reform measures of the government that pose hindrances to council authorities and their functioning, which the party said these councils have already brought to its attention.

The opposition party had urged the government to revise its initially proposed budget and resubmit it for parliament’s approval.

The Decentralization Act mandates an allocation of no less than 5 percent from the state budget to council bodies per every fiscal year.

While the government forecasts an annual income of MVR 39.8 billion for 2025, a 5 percent allocation for the councils would exceed MVR 1.4 billion based on the annual revenue forecast.

Besides the opposition party, several council bodies have raised concerns on the matter as well.

On Saturday, President Dr. Mohamed Muizzu said that the budget for next year would include the legally-mandated amount for block allocation.

Meanwhile, MDP has been raising concerns about the Urban Development Bill which aims to establish urban development centers in key areas in the country. The opposition party claims these efforts are aimed at reverting back to the former governance system that relied on state-appointed officials  or ‘Kateebs’ as the topic administrative authorities in the islands.