SOE Workforce Nearly Doubled Under MDP Administration: Finance Minister

The workforce of State Owned Enterprises (SOEs) nearly doubled during the previous MDP administration, increasing from 18,676 employees in 2018 to 36,729 by the end of 2023, Minister of Finance and Public Enterprises Hassan Zareer told Parliament today.

Responding to a question from North Galolhu MP Mohamed Ibrahim regarding recruitment practices, organisational restructuring and right sizing in SOEs, Minister Zareer said data from the Privatization and Corporatization Board (PCB) showed that 18,053 employees were added to state owned companies between 2019 and 2023.

This represents an approximate 97 percent increase in the SOE workforce over the five year period.

Minister Zareer said the current administration does not support dismissing employees based on their political affiliations or views, adding that the Ministry of Finance has not instructed SOEs to terminate employees for political reasons.

However, he said the Ministry, as the government’s representative in SOEs, has a responsibility to ensure the financial and operational sustainability of state owned companies.

In view of the country’s fiscal situation, Zareer said the PCB has issued instructions on several occasions to improve corporate governance, efficiency and financial sustainability. He clarified that these instructions are aimed at strengthening the overall performance of SOEs and are not directives concerning individual employees or day to day administrative decisions.

According to figures presented to Parliament, SOE employment has increased further since the end of 2023, with the current workforce standing at 41,667. This represents an increase of 4,938 employees, or 13 percent, since the end of 2023.

Zareer also said excessive recruitment during the previous administration contributed to financial pressure on SOEs, with the government providing MVR 634 million in advance subsidies by the end of that administration to facilitate salary payments.

The current administration has begun measures to streamline SOE operations and implement right sizing initiatives. As part of these efforts, a system is being established to enable employees leaving state owned companies to access financing through the MVR 600 million SME Impact Fund and pursue business opportunities.

Addressing questions about newly established companies, Zareer said five new entities currently employ a combined 889 people. Of these, only 156 are new recruits, while the remaining 733 employees were transferred from State Trading Organization (STO) to the State Pharmaceutical and Medical Supply Corporation following the transfer of pharmaceutical and medical supply operations.

The State Pharmaceutical and Medical Supply Corporation has 866 employees, while the Development Bank of Maldives has 17 employees and the Maldives Fisheries and Ocean Resources Marketing and Promotion Corporation has six.

Maldives Economic Gateway Development Limited and Infrastructure Development Solutions Company currently have no employees.

Zareer also outlined measures to reduce the number of SOEs and consolidate the management of loss making entities.

The Maldives Sports Corporation has been dissolved after failing to achieve its objectives, with its 12 employees transferred to the Ministry of Sports.

A liquidator has also been appointed to oversee the dissolution of the Maldives Integrated Tourism Development Corporation (MITDC), which had 10 employees at the time the decision was made.

In addition, an agreement was signed on May 28, 2025, to merge Regional Airports Company with Maldives Airports Company Limited (MACL).

According to Zareer, the merger is expected to save the state budget MVR 10 million each month in administrative expenses and salaries previously incurred by Regional Airports. He said efforts are also underway, with MACL’s support, to make regional airports financially self sufficient through increased revenue generation.

Zareer reaffirmed the government’s commitment to improving the financial performance of SOEs, strengthening their operations and reducing their reliance on the state budget.