A resolution has been submitted to the People’s Majlis alleging that the government is acting in violation of the state budget approved by Parliament, as well as the Pension Act, the Fiscal Responsibility Act, and the Public Finance Act.
The resolution, submitted by the MDP Member of Parliament for North Galolhu, Mohamed Ibrahim (Kudu), notes that the Constitution explicitly states that no expenditure shall be made from the state budget without parliamentary approval, and funds allocated for specific purposes must only be used for those purposes.
The resolution further highlights that the Public Finance Act and the Fiscal Responsibility Act outline the specific principles and rules by which the government can manage cash flow and incur debt.
However, MP Kudu stated in the resolution that the government’s efforts to have the Pension Fund invest in a government bond to cover state expenses are in direct violation of the Pension Act, the Public Finance Act, and the Fiscal Responsibility Act. He also pointed out that several members of the Pension Board have resigned due to their dissatisfaction with this matter.
Therefore, MP Kudu submitted this resolution to gauge the views of parliamentary members in order to fulfill the Majlis's responsibility of holding the government accountable. The resolution has been scheduled for the agenda of today’s parliamentary session.
The issue involving the Pension Office's move to purchase an MVR 2.4 billion government bond has become a heated controversy. The Pension Board decided to proceed with this investment in October last year.
Following that decision, Ahmed Saruvash Adam, a board member and a former senior figure in budget formulation at the Finance Ministry, resigned that same month.
Subsequently, the CEO and Chairperson of the Pension Office, along with several other board members, have also resigned.
Following his resignation, Saruvash stated that this transaction involving the MMA and the government would require either an increase in the Rufiyaa supply or the exchange of dollars from the official reserves, and either way, it would lead to an increase in the supply of Maldivian Rufiyaa.
Additionally, Chairperson Inaz stated that he believes this transaction is a decision that would cause significant harm to the economy.
