Muizzu ratifies Decentralization Act amendments despite council concerns

Despite objections from several councils, the amendments to the Decentralization Act was approved on Thursday evening by President Dr. Mohamed Muizzu.

The Parliament had passed the amendment last Wednesday, amidst concerns raised by various individuals and councils. The bill saw 45 out of 52 present members voting in favor, with seven voting against.

The approved amendment introduces five key changes to local governance. Local authority companies will now be restricted to essential rural infrastructure projects exceeding MVR 10 million and must cease competition with private enterprises within 90 days of the amendment's enactment.

Additionally, councils are prohibited from charging rent for land or buildings used for basic public services. They will receive revenue after state tax deductions, provided they are not delinquent in public service payments for over six months. Councils are also mandated to maintain bank accounts according to Ministry of Finance procedures and provide statements upon request. In their final year, councils will face restrictions on new employee recruitment, leasing land, lagoons, or reefs, and initiating new development projects not previously outlined in their plans.

Regulations are also being amended to impose restrictions on councils nearing the end of their 365-day term. These include adhering to norms set by the Ministry of Finance and the Local Government Authority (LGA) for actions such as recruiting employees, leasing land, lagoons, and reef areas, and commencing new development projects not already outlined in their plans. It is important to note that these amendments do not grant additional authority to the LGA, the parent body of the councils.

Some councils, including B. Dhonfanu Council President Ahmed Irushad, had urged the President not to approve the amendment. During the President's recent visit to Baa Atoll, Irushad emphasized that decentralized financial empowerment was crucial for Dhonfanu's development, more so than a council building.

Irushad expressed significant concern over the Parliament's amendments, requesting that any changes diminishing councils' revenue not be approved. This sentiment is widely shared among many councils across the Maldives, who fear the reforms will financially weaken them and centralize their existing powers.

In defense of the reform, President Muizzu spoke at B. Dharavandhoo during his Baa Atoll Tour last Wednesday evening. He asserted his comprehensive understanding of decentralization, stating that the changes are ultimately for the benefit of the people. "I know decentralization from A to Z," he stated.

"One of the reforms is that some councils have now created local authority companies. These local authority companies are running small businesses normally run by ordinary people in rural areas. Like the grocery shops on street corners. This is actually preventing the public from attaining wealth in these markets,” he said.

He also noted that most councils do not disclose their account balances. He added that some councils spend money near elections and carry out projects not aligned with the island's development for political purposes, a practice he stated must be stopped.