Fuel costs push subsidy spending above budget
The government had spent about MVR 3.5 billion on subsidies as of 27 August, compared with MVR 2.9 billion allocated for the full year.
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Government expenditure on subsidies has exceeded the amount allocated in this year’s budget by MVR 654 million, according to figures published by the Ministry of Finance and Public Enterprises.
The government had spent about MVR 3.5 billion on subsidies as of 27 August, compared with MVR 2.9 billion allocated for the full year.
This means subsidy expenditure has already exceeded the annual budget allocation by about 23 per cent, with four months of the year remaining.
Subsidy spending has also increased by about MVR 1.5 billion, or 73 per cent, compared with the same period last year.
The increase was driven in part by expenditure on fuel subsidies as the government maintained domestic fuel prices amid increases in international oil prices linked to the conflict involving Iran.
Government expenditure on the Aasandha health insurance scheme has also increased.
As of 27 August, spending on Aasandha was MVR 141.2 million higher than during the corresponding period last year.
However, expenditure on medical assistance provided outside Aasandha through the National Social Protection Agency (NSPA) declined by MVR 37 million compared with the same period in 2025.
Spending on other forms of financial assistance and allowances has also increased this year.
Finance Ministry figures show expenditure under the category increased by MVR 615.2 million compared with the corresponding period last year.
The increase follows the expansion of allowances and the inclusion of higher allocations for several groups in the 2026 state budget.
