President Dr. Mohamed Muizzu has today ratified the National Fiscal Responsibility Bill, a significant legislative initiative aimed at ensuring sustainable and transparent fiscal management in the Maldives.

The bill, which was passed by the Parliament during the 55th sitting of the 20th Majlis on November 27, 2024, is set to establish a robust framework for fiscal discipline and accountability.

Proposed by the Government, the new legislation outlines feasible fiscal standards designed to align state fiscal operations with legal and regulatory obligations.

Under the law, the Government can borrow from the Central Bank to manage cash flow, provided such borrowing does not exceed 2.5% of the average revenue collected over the previous three years.

The law mandates the Minister of Finance to develop key fiscal documents, including a Fiscal Responsibility Charter, Fiscal Strategy Statement, Budget Statement, and Risk Statement, all of which must be submitted to Parliament.

The inaugural Fiscal Responsibility Charter under this law is to be published in the Government Gazette within six months of the law’s ratification.

Additionally, the Auditor General is tasked with monitoring the law’s implementation and preparing reports for Parliament.

These reports will facilitate a comprehensive fiscal impact analysis, enabling Parliament to assess government performance and provide recommendations for improvement.

The National Fiscal Responsibility Bill was published in the Government Gazette following its ratification and will come into effect six months later according to President's office.

The enactment of this legislation will nullify the existing Fiscal Responsibility Act, marking a new era of fiscal governance for the Maldives.