Urbanco falls short of projected revenue from land sales: Ameer

Minister of Finance Ibrahim Ameer has said that Urbanco's income fell short of the projected revenue from land sales.

While submitting the supplementary budget for 2023, the minister said that the highest funds allocation for the state-owned enterprises from the additional budget was owed to Urbanco falling short of its projected revenue from land sales.

"The government had to allocate funds from its budget to Urbanco for its cashflow management due to rent cuts from Hiyaa flats. An allocation of MVR 611.7 million has been included in the supplementary budget towards injecting capital," Ameer said.

The supplementary budget has a total allocation of MVR 1.2 billion towards SOEs, with majority of this allocation concentrated on fuel subsidy at a total of MVR 530 million designated for Fenaka Corporation and State Electric Company (STELCO).

The minister highlighted that a treasury loan of MVR 291.3 million has been allocated as a capital injection for Road Development Corporation (RDC).

The annual total for fuel subsidies spent by the government is expected to reach MVR 1.8 billion, while the minister said that this increment is owed to the price surge of oil in the global market.

The minister also noted that majority portion of the supplementary budget has been concentrated on Aasandha, the state-initiated health insurance scheme, which Ameer said was due to the increase of medical expenditure by the public, which decreased momentarily following the Covid-19 pandemic.

"We need significant reform to ensure sustainability of the Aasandha system, but it is a crucial system ensuring availability and affordability of medicine for the public as well. To curtail leakages in the system, the government planned bulk procurement of medicine in 2023 for which the state entered an agreement with the UNDP," Ameer said.

A total of MVR 1.2 billion has been allocated for Aasandha in the supplementary budget.

The minister said that the revenue received to the state through cross subsidies have been redirected to inject capital to SOEs.

The government approved a total of MVR 42.8 billion for the 2023 state budget last year, which will increase to MVR 49.4 billion with the MVR 6.5 billion supplementary budget.