Finance Ministry, on Thursday, citing funds allocated for salaries in the state budget is already high, states that any further increment will make fiscal expenditure unbearable.
Speaking at the Budget Committee on Thursday, Deputy Finance Minister Ahmed Saidh Musthafa noted that MVR 14.8 billion has been allocated in the 2026 budget for salaries alone, adding the amount will climb to approximately MVR 17 million once allowances and pension are included.
He emphasized that this is a huge amount compared to the whole state budget.
Finance Ministry officials at Budget Committee convening on November 13, 2025: The Ministry officials states any further rise on salary expenditure would make fiscal expenditure unbearable. (Photo/People's Majlis)
Saidh cited the rising expenditure on salaries year by year as one of the biggest obstacles to effectively managing fiscal expenses. He warned that if this trend continues, fiscal expenditure would become unbearable.
“There is the possibility that it might reach a level where we are unable to sustain fiscal expenditure if the expenditure on salaries increases any further than what is projected. We expect it [next year] to be a year where the budget has to be meticulously managed and controlled,” he said.
According to Saidh, the biggest expenses incurred by offices and institutions account for the salaries of their employees. As such, he said the funds allocated to honor other legal responsibilities are relatively smaller due to the high allocation for salaries and allowances.
Saidh raised concerns, emphasizing that this is leading to low funding for economic sectors, including projects.
Speaking further, Saidh said the Ministry was considering the establishment of a performance-based budget next year following discussions with some institutions. He did not provide any further details in this trajectory.
Finance Ministry officials at Budget Committee convening on November 13, 2025: The Ministry officials states any further rise on salary expenditure would make fiscal expenditure unbearable. (Photo/People's Majlis)
Approximately 30 percent of the record-high MVR 64.2 billion budget has been allocated to pay salaries.
Speaking at the Budge Committee on Wednesday, Anti-Corruption Commission (ACC)’s president Adam Shamil raised concern over the budget allocated for the Commission next year, citing that it is insufficient for its operations. He added that 78 percent of the budget will be incurred to pay the salaries of its staff.
Taking examples of such institutions, Saidh said institutions must forego the practice of hiring excess employees for their operations, citing that there is an excess of employees in all institutions.