Government Expenditure Falls by 15.3 Percent, Budget Records MVR 186.7 Million Surplus

Government expenditure has declined by 15.3 percent compared to the same period last year, with the overall government budget recording a surplus of MVR 186.7 million as of October 16, 2025.

According to the Weekly Fiscal Development Report published by the Ministry of Finance—following a three-week pause to resolve recording issues in revenue and expenditure—the total government spending stood at MVR 30.5 billion by mid-October. This marks a significant reduction from the corresponding period in 2024.

Recurrent expenditure, which covers day-to-day administrative and operational costs, fell by 0.2 percent, while capital expenditure, which funds infrastructure and development projects, dropped sharply by 58.1 percent. The report highlights that 59.1 percent of recurrent spending was directed toward administrative operations of government offices—a 2.9 percent decrease compared to last year.

Expenditure on office supplies declined by 13 percent, while repair and maintenance costs fell by 3.3 percent. Meanwhile, state spending on various aids and subsidies dropped by 7.9 percent year-on-year, reflecting efforts to contain recurrent costs.

Debt repayment expenditure amounted to MVR 4.4 billion by October 16—more than double the MVR 2.0 billion recorded during the same period in 2024. The report attributes this increase primarily to higher interest payments on existing loans.

Capital expenditure reached MVR 4 billion, of which MVR 3.5 billion was spent on infrastructure assets such as roads, bridges, and airport development projects. Despite the overall cut in spending, outlays for the Public Sector Investment Program (PSIP) showed growth, with MVR 5.9 billion spent so far this year out of an allocated MVR 12.4 billion for 2025.

A substantial portion of PSIP spending focused on improving transportation infrastructure, with MVR 3.9 billion directed toward related projects. Additionally, MVR 164 million was spent on housing initiatives across the country.

With these developments, government expenditure remains lower than last year, resulting in a rare budget surplus of MVR 186.7 million as of mid-October—signaling tighter fiscal management and a possible shift toward greater spending efficiency.