Minister of Finance Moosa Zameer has submitted the supplementary budget to cover state-expenses, worth a total of USD 332 million, to the Parliament. The budget includes USD 97.3 million as recurrent expenses and USD 227 million as capital expenditures.
Following the submission of the supplementary budget, Minister Zameer noted that the state budget was approved by the previous administration. The minister stated that the previous administration did not prepare the budget such that the economic reforms could be implemented. He added the current administration has submitted the supplementary budget in accordance with legal requirements, taking into account upcoming projects and anticipated expenses.
The supplementary budget was proposed as the state budget is insufficient to fulfil the visions of President Dr. Mohamed Muizzu and his administration. Contributing factors include expectations of increased time and costs for implementing reforms, higher-than-expected expenses for medical consumables, anticipated increased spending on indirect subsidies, and a rise in loans issued under the student loan scheme. Additionally, USD 129.7 million of the supplementary budget is allocated for to carry out Public Sector Investment Programme (PSIP) projects, without any halts.
The supplementary budget consists of an additional USD 28.6 million for state owned enterprises (SOEs), additional USD 42.2 million for the contingency budget, USD 29.7 million for student loans, USD 13 million for medical consumables, USD 17 million to assist with medical treatment, USD 66.1 million for subsidies and USD 1.5 million for salaries.
The Ministry of Finance stated that the supplementary budget will be financed through project loans, the sale of Treasury bills, and internal loans. Specifically, the government plans to secure USD 64 million from international sources and USD 194 million from internal sources.
An additional USD 3.6 billion will be added to this year's state budget when the supplementary budget is passed. Last year, a supplementary budget of USD 421 million was approved to cover state expenses.