The Government of the Maldives has decided to take stringent measures to reduce the cost of running the state due to the increase in oil prices and commodity prices in the world market due to the Russian-Ukrainian War.
Minister of Finance Ibrahim Ameer signed and issued a circular to all government offices asking them to comply with the measures taken by the government to reduce expenditure. The circular, sent to government offices, said government expenditures are also increasing due to the increase in oil prices and commodity prices in the world market due to the Russian-Ukrainian War. The circular noted government expenditures are higher than previously estimated, and measures taken to reduce public expenditure with the economic challenges include suspending promotions of employees and ordering them to do only essential work during official hours.
The circular ordered for scholarships given to employees at state expense to be stopped at this time and for seeking any services except essential services. The circular also ordered the suspension of any renovation work on the offices.
The government offices are also directed not to spend more than USD325 unless they obtain the permission of the finance ministry. The circular said all government offices will have to comply with the circular from June 20. The local councils will also have to take these measures into account when spending block grants and own revenue, according to the circular.
The measures taken include not creating any positions at the expense of the state budget, not changing the pay structure without the permission of the National Pay Commission, not giving promotions to staff and increments in salary, and suspension of trips abroad except for trips provided by foreign parties and obtaining finance approval for expenditure in excess of USD325.
The Russian-Ukrainian War and the rise in oil and commodity prices in the world market have led to the announcement of a policy to reduce public spending after President Ibrahim Mohamed Solih gave an indication of such a move at a recent press conference.