MVR 1b in power subsidy advance payments for Fenaka cashflow
In addition, the state-owned utility company has been given MVR 213.3 million from the state budget as capital injections.
Top Stories
The budgeted subsidy to reduce electricity prices is being paid in advance to Fenaka Corporation to cover its expenses, it has been learnt.
According to the Fiscal Strategy Statement released by the finance ministry last week, expenses for electricity subsidy exceeded the budgeted amount last year and this year.
One of the main reasons is:
-
The government has paid Fenaka in advance for electricity subsidy to help it manage its cash flow
-
Spending on electricity subsidies has increased to MVR 1.2 billion; Most of it has been given to Fenaka
In addition, the state-owned utility company has been given MVR 213.3 million from the state budget as capital injections.
Fenaka owes billions of Rufiyaa. Businesses are owed millions and there are many allegations of corruption within Fenaka.
At the end of last year, Fenaka had outstanding debts of MVR 2.22 billion to various parties and the company was in a financially fragile position, according to the financial reports released by the Privatisation and Corporatization Board (PCB), which oversees state-owned companies
Looking at the financial highlights of Fenaka at the end of last year:
-
Revenue stood at MVR 2.1 billion while expenditure stood at MVR 2 billion
-
Expenditure increased by MVR 1.4 million
-
Expenses increased in the areas of staff training, recreation club, staff accommodation and meals
-
The company reported a profit of MVR 15.6 million
Fenaka has recently borrowed MVR 400 million from Maldives Islamic Bank (MIB) to manage its ballooning debt.
