News Desk
MALE’ — The government’s expenditure on state employee salaries and benefits has continued its upward trajectory, reaching MVR 8 billion for the first half of 2026. According to the latest data from the Ministry of Finance, this figure represents a 10 per cent increase compared to the MVR 7.2 billion spent during the same period last year.
As the government grapples with high levels of recurrent spending, the payroll remains the largest single drain on the national budget.
The report highlights significant growth across all major components of personnel expenditure:
- Allowances: The state spent MVR 3.1 billion on employee allowances—an increase of approximately MVR 200 million over the previous year.
- Base Salaries: Expenditure on basic salaries rose by roughly MVR 400 million.
- Pensions and Benefits: Pension costs increased by MVR 100 million, while retirement benefits reached MVR 390 million, marking an 11 per cent rise. The national budget for 2026 has allocated a total of MVR 739 million for retirement benefits.
The figures underscore a structural challenge in the national budget: the heavy reliance on funding for the public sector workforce. For 2026, the government has allocated a total of MVR 17 billion for salaries and benefits.
This allocation is significant by any measure, accounting for:
- 43 per cent of total recurrent expenditure.
- 27 per cent of the total national budget.
The data confirms that the state’s operational costs are increasingly weighted towards personnel, leaving policymakers with limited fiscal space for capital investment or debt reduction strategies. As the administration works to keep the national deficit under control, the consistent growth in the public sector wage bill remains a primary focal point for economic observers and fiscal planners alike.
