MDP accuses govt of major lags in financial reforms
When the MDP government had ended, the plan to reduce expenditures had been completed, he said.
By
Aishath Fareeha Abdulla
Former Finance Minister Ibrahim Ameer said on Sunday that the current government has not taken the measures announced in the budget last month to improve the economic situation, nor has begun implementing them and any delay in implementing them will lead to a widening budget deficit.
Ameer, who was the Finance Minister in the previous MDP government, told a press conference at the MDP office on Sunday that the government has not received any money for the budget and economic reform measures have been delayed.
The opposition MDP held a press conference on Sunday to discuss the economic situation in Maldives.
"We had begun taking fiscal reform measures. We targeted to increase GDP by 6%, to bring about 6% reform. That includes increasing revenue and reducing expenditure," he said.
He said:
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Revenue increase targeted at MVR 3 billion; it started with the change in tax rates last year
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Efforts were made to cut MVR 3 billion in expenditure; the agreement was signed in June last year to bring in the drugs as bulk procurement
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Started working on a strategy to deal with medium-term incomes
"As part of the fiscal reform plan, the budget will also mention a new subsidy regime. Besides, we plan to do Aasandha reforms, state-owned companies and mitigation of risks associated with rising fuel prices through the budget," Ameer said.
He called on the current government to maintain the cost-cutting measures planned by the previous government.
"All this government has done in the last nine months is to check whether the work we have done is good. No reform work has been done," he said.
Instead of taking reform measures, the government is always making excuses, he said, adding that reform measures have not been started since last month despite being included in the budget.
"This government has not made any changes to subsidies and Aasandha in the past nine months. A nine-month study has not achieved anything," he said.
When the MDP government had ended, the plan to reduce expenditures had been completed, he said.
The budget for this year is a deficit at baseline and the deficit will be further increased due to the delay in implementing reform measures in recent days, he said.
"The budget is about MVR 50 billion. If it goes as it is now, the Finance Minister has mentioned in Parliament that the budget will reach MVR 57 billion. How did this happen?"
If the plan goes according to our budget, the budget would not reach that amount, he said, noting that he can see the expenditure mounting due to the lag in reforms.
"If the reform measures are not implemented now, we will have to raise about MVR 1.8 billion more. That is if we delay the subsidy reform alone," he said.
He noted that:
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The baseline deficit is MVR 14 billion
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The budget deficit will increase to MVR 916 million if the subsidy changes are implemented in the fourth quarter of this year
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If it is not implemented, it will add MVR 1.8 billion to the budget deficit
"It is already too late. At this point, the government has to raise about MVR 916 million more because of the delay in implementing the reform plans," he said.
"It is already obvious that the government has not been able to raise a single dollar from abroad to finance the budget. No idea how another MVR 1 billion can be raised. The bitter consequences are already obvious”.
