Govt budget, a slap on public’s hopes: Shahid

The former Minister of Foreign Affairs, and President of Maldivian Democratic Party (MDP), Abdulla Shahid has criticized the incumbent administration’s state budget for 2024.

Shahid claimed the budget was a slap on the hopes of, and would further burden the public.

The Maldives government has submitted a forecast budget of MVR 56.6 billion for the upcoming year.

In response to this, Shahid in a post on X said that the budget for 2025 reflected the current administration has failed in planning how it would achieve its promises to the people.

Noting how President Dr. Mohamed Muizzu back when he was running for the presidential seat last year claimed he was aware of the country’s fiscal status, Shahid said that the incumbent president has led his government to propose a budget without assessing its implications, and without a proper plan.

Shahid further said that the proposed tax hikes from individuals and businesses next year would further dent their financial sustainability and subsequently dampen economic benefits and growth.

The former minister also said that the higher expenditure, disproportionate with the tax earnings will impact the financial sustainability. Shahid also said that though the current administration makes claims of strong cost-cutting efforts, the continued wastage from public accounts to pay political appointees and for other unnecessary initiatives was not reflective of such austerity efforts.

The opposition party leader said that the state’s recurrent expenditure was only mounting, and added that the government is required to generate MVR 16.9 billion to sustain the budget.

He added that the state has not specified how it intended to acquire this amount, and the budget was not well thought-out.

The MDP leader also said that in light of the incumbent government’s failure to maintain diplomatic ties properly, the country would face obstacles in seeking foreign aid for the budget as well.

Shahid further claimed that the living standards of the public will continue to devolve due to the budget, while businesses will experience slower earnings and the economic growth will hit snags.

He also alleged the current government has been methodically erasing the previous government’s policies on transparency by concealing public interest knowledge. He said the state was redacting previously available information from the budget.

While noting that the most significant allocations are made towards the salaries, wages and pensions of public sector employees and on developmental projects, Shahid said that the next year’s budget has not provided a detailed breakdown of the remuneration allocation for public sector employees.

The projected total expenditure for next year is MVR 42.9 billion; with MVR 35.9 billion out of this total allocated for recurrent expenditure and the remaining MVR 13.3 billion on capital expenditure. The government projects an annual total revenue of MVR 39.8 billion, inclusive of a projected MVR 2.5 billion in foreign grants.