President Dr Mohamed Muizzu has assured the public that the government will not terminate existing subsidies and national health insurance policy, Aasandha coverage extended to the citizens. The President made the announcement while addressing the people of Mathiveri, Alifu Alifu Atoll, as part of his ongoing tour to select islands in the Alifu Alifu and Kaafu Atolls.
In his address, the President clarified the recent changes to the subsidies offered by the government. He reiterated that, despite the government taking strong measures to reduce expenditure, the subsidies and Aasandha coverage as well as retirement pensions will not be affected. Instead, the government intends to further enhance these forms of assistance, he said.
"I have previously announced that all civil servants who have not received a salary increment will receive the increment in 2025 as part of pay harmonization efforts. This includes all judiciary staff. In 2026, we will introduce the same concept to other sectors, bringing about pay harmonisation and salary increments across the board. Our goal is to increase income without compromising any current benefits," he explained.
The President highlighted that the current administration had achieved and continues to achieve economic growth and establish infrastructural development without having to resort to practices such as money printing, while also ensuring the state does not go into bankruptcy. He described the government's fiscal approach as a key policy of his administration.
President Dr Muizzu further outlined that a necessary reform that must be implemented in the subsidy system was to prevent wasteful expenditure and prevent undue profiteering.
"For instance, some pharmaceutical businesses that sell medicines with profit margins multiplied manyfold. We must put an end to this. Doing so will not inconvenience the people in any way, and it will not affect the Aasandha [coverage] they currently receive," he said.
The President further revealed that some medicines are sold in the Maldives at 1000 times their actual cost, including some of the most commonly sold 250 medicines in the Maldives. The government has now brought changes to Aasandha to tackle this issue such that high-quality medicines are imported to the Maldives through a bulk procurement system, with the State Trading Organization (STO) maintaining affordable prices for these medicines. He also urged private pharmaceutical companies to adhere to the government's policies.
Noting that the government is working hard to reduce expenditure and increase revenue, the president expressed confidence that the reforms that are currently being implemented will yield positive results that are beneficial to the people.
The Maldives is one of the countries where high-volume subsidies are provided to citizens relative to its population. While the government-provided subsidies cover all essential services, international financial entities have recommended reducing these subsidies to cut-down costs during Maldives' current economic woes. However, these agencies have also acknowledged and praised the government's efforts to minimise wastage.