Parliament has unanimously approved new measures aimed at recovering outstanding debts owed to the state, including a policy change that would prevent companies with unpaid dues from being awarded government projects.
The decision follows a report compiled by the Public Accounts Committee, which revealed that the Housing Development Corporation (HDC) is owed MVR 1.4 billion. Of this amount, MVR 1.2 billion is attributed to private companies, while government offices and state-owned enterprises account for the remainder. HDC, which manages significant areas of Hulhumalé, has been grappling with the issue of unpaid rent for lands and properties leased to various entities.
According to the report, HDC has already terminated lease agreements for 188 locations, including land plots and buildings, over nonpayment. Despite efforts to recover funds — including the retrieval of MVR 221.8 million last year — a substantial portion of the debt remains unsettled.
In response, the Public Accounts Committee recommended seven measures to address the situation. These include requiring HDC to formulate and submit a debt recovery plan within 30 days, implementing a policy for granting payment extensions and waivers, and seizing assets where HDC has legal authority. The committee also advised that bidders for government projects must be cleared of any outstanding debts with HDC before contracts are awarded.
Further recommendations were directed at the Ministry of Finance, instructing it to establish a system to verify whether companies have unpaid debts to the state before awarding major projects. The committee also urged the Ministry to create a mechanism to offset payments owed to and by the government and called for greater transparency in HDC’s corporate social responsibility initiatives.
The report was passed unanimously with 71 votes during Tuesday’s parliamentary sitting.
President Dr Mohamed Muizzu has publicly pledged to recover funds owed to the state, citing the country’s ongoing financial difficulties. While efforts to collect outstanding debts from individuals and companies are underway, the government also faces scrutiny over its own unsettled payments to private businesses, which remain outstanding despite earlier promises to resolve them before Ramadan.
