The People’s Majlis Public Accounts Committee today approved the finance ministry’s request for another one-year extension of the time during which the government is entitled to overdraw from public bank accounts, after cutting the cap to MVR 2.5 billion.
After consulting with the Maldives Monetary Authority (MMA), the auditor general, and the finance minister, the Public Accounts Committee decided to prolong an overdraft extension with amendments to the initial proposal by the finance ministry.
The committee’s amendments include lowering the maximum limit from MVR 3.5 billion to MVR 2.5 billion and prolonging the extension date from April 26, 2023, to December 31, 2023.
Previously, the People’s Majlis authorised the suspension of Article 32 (a)(b)(e) of the Fiscal Responsibility Act, enabling MVR 4.4 billion to be overdrawn from the MMA public accounts.
During the parliamentary discussion, the ruling MDP lawmakers defended the government’s overdraw request, while opposition members declared that they do not support the proposal.
Finance Minister Ibrahim Ameer stated in a letter to Majlis requesting an overdraft extension that the Maldives has yet to recover from the effects of the COVID-19 pandemic, despite reopening the border, and that an extension to the overdraft period is required to provide necessary services to citizens.
Since the original overdraw authorisation in 2020, the Maldives has overdrawn MVR 2.8 billion, with the amount likely to rise to MVR 4 billion by the end of 2021.