Fenaka must be overhauled before it collapses

The latest audit of Fenaka Corporation lays bare a culture of entrenched corruption, political patronage and financial mismanagement that threatens to sink the state-owned utility.

The report by Auditor General Hussain Niyazy, covering 2021–2023, details malpractice on almost every page, pointing to systemic graft rather than isolated cases. 

Fenaka’s problems are not new. Since its creation, every government has inherited what it described as a “ruined” company and then left it in no better shape. Allegations surface, reports are published, but few face consequences.

The most high-profile name is former Managing Director Ahmed Saeed (Fenaka Saeed). During his tenure the Anti-Corruption Commission (ACC) opened more than 22 cases and submitted a major report to then-President Ibrahim Mohamed Solih. Yet Saeed remained in office until the  Criminal Court handed him a four year prison sentence yesterday.

He is not alone. Former Managing Director Mohamed Nimal was also charged during Abdulla Yameen’s administration, but investigations dragged on and he now holds another government post.

According to sources familiar with state-owned enterprises, powerful private firms drive much of the corruption, using political leverage regardless of which party is in office. Procurement rules are routinely ignored. Suppliers are tipped off in advance, with the audit reporting one case of goods worth MVR 12.3 million imported before bids were awarded.

Employees and board members alike have profited. Petty cash alone accounted for MVR 26 million in spending. Senior officials are said to maintain close ties with MPs and ruling party figures, ensuring special treatment in project awards.

This climate has made it nearly impossible for honest managers to survive. Political influence shields entrenched staff who benefit from projects, even if MDs change with each administration.

Fenaka has also become a tool of political patronage. Employing the main breadwinner of a household has long been a means of securing votes in island communities.

The result is an inflated workforce. The company admits it needs around 3,000 staff, yet employs close to 7,700. Last year alone, salaries cost MVR 840 million.

By comparison, Fenaka has more staff than giants such as Bank of Maldives, Maldives Airports Company Limited (MACL) and STO; despite earning far less revenue.

The audit suggests the company has repeatedly taken on projects beyond its capacity, leading to heavy losses and more opportunities for graft.

Downsizing has been floated as one solution, possibly by splitting Fenaka into two regional utilities to improve oversight.

But structural reform alone will not succeed without political will. As one former official observed, MDs often act on orders from above, meaning real responsibility lies with the finance ministry and government leaders who sign off on budgets and projects.

An audit report, however will not by itself change the culture. ACC and the Prosecutor General must act, Parliament must exercise oversight, and political leaders must stop using Fenaka as a vehicle for political favoritism.

Otherwise, the cycle of corruption will persist until the company is bankrupt and ordinary Maldivians are left to pay the price.