MP Shamheed: Island Development Funds Diverted to Wasteful Spending Each Year

Dr. Ahmed Shamheed, the Member of Parliament for the South Hulhumale' constituency, has stated that although funds are budgeted annually for island development, these allocations are often diverted to wasteful expenditures by the end of each year.

Speaking on RaajjeTV’s "TV Talk" program, MP Shamheed stated that President Dr. Mohamed Muizzu’s administration lacks any clear policy for managing the Maldives' domestic economy. The lawmaker further noted that while all government expenditure appears to be tied to a foreign company, the reasons behind this arrangement remain unclear.

MP Shamheed stated that a review of the budgets from the past two years reveals that, by year-end, funds had consistently been diverted toward irresponsible expenditures.

Looking at the past two budgets, we observe a recurring pattern where funds earmarked annually for public development are depleted by the end of the year through obscure and irresponsible spending. This year, approximately 8 billion rufiyaa was allocated for island development, following 12 billion rufiyaa last year. Even within that 12 billion—which included 3 billion specifically for housing—the funds were diverted into various ventures, such as purchasing software or establishing brick-making companies, solely to facilitate the importation of goods from abroad.

Dr. Ahmed Shamheed

Shamheed noted that 4 billion Rufiyaa from this year's Public Sector Investment Program (PSIP) budget remains unspent. He further stated that as long as the country continues to be managed in this manner, neither the domestic economy nor the ongoing dollar shortage will be resolved.

Furthermore, MP Shamheed stated that in the Maldives' recent history, budgets have been formulated with projected revenue and recurrent expenditure at nearly equal levels, resulting in the practice of taking out new loans to service existing debt. Consequently, he noted that the country continues to operate on a deficit budget. MP Shamheed further asserted that this issue has significantly escalated today due to the current administration's policies.

It is clearly evident that under the government's current policies, we are securing future receivables at heavily discounted rates. For instance, to meet immediate foreign currency needs, the government is applying significant discounts to the $5 million lease extension fees required for resorts to transition to 99-year leases.

Dr. Ahmed Shamheed

MP Shamheed stated that the current trend reflects investments that yield no profit for the state, emphasizing that it is time to shift toward investments that generate at least some level of return. Furthermore, MP Shamheed noted that the government's current policies lack any mechanism to ensure the circulation of money within the Maldivian economy.