Ministry of Finance on Sunday gazetted a bill which necessitates a permit from the president for any government institution to exceed the budget designated by the state.
According to the bill, the Finance Minister can only grant permits if the budget is not exceeded by five percent. For any projects or work that overreaches outside the set budget, a special authorisation by the president is mandatory.
The Finance Ministry stated that the reason for the regulations are to ensure that government institutions' expenditures are in accordance with the budget plan. Furthermore, it is to implement the bill passed by the parliament for the financial year in a way as to encourage government institutions to conduct expenditures as planned.
Currently, ministries are able to make necessary expenditures or exceed budgets without special authorisation.
The regulations will be implemented with the state budget to be passed in the upcoming year. There are special criterion that institutions will have to adhere to while compiling budgets.
The new budget to be presented under the newly passed criterion, must include the total amount and the general budget, with separate budgets for all government offices. Moreover, a maximum limit that a minister can permit for expenditure must be included as a contingency.
The budget can be exceeded only by presenting a supplementary budget to the parliament that must be passed.
The new regulations dictate that the budgets can only be used for their designated purposes.
The president's authorisation is also mandated in cases where projects which are not designated budgets cost more than MVR 1 million. If such a project were to cost less than MVR 1 million, authorisation from the Finance Minister is necessary.
Furthermore, a written permit from the president is required when amending projects included in budgets if their expenditures exceed the total price by 30 percent.
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