Fayyaz says SOE layoffs will cut 14,000 jobs and impact 50,000 people

Former Economic Minister Fayyaz Ismail says the government’s order for state-owned enterprises (SOEs) to cut 33 percent of their staff will result in more than 14,000 people losing their jobs, affecting over 50,000 dependents across the country.

Speaking at an MDP press conference on Tuesday, Fayyaz said the scale of the layoffs is unprecedented for a country the size of Maldives. He noted that the government had repeatedly accused the previous administration of over-staffing SOEs, yet is now “rightsizing down to the same level” as the last MDP government.

The government has long faced criticism for excessive hiring in SOEs, including allegations that many employees receive salaries without performing meaningful work, and that companies are used to distribute jobs for political purposes.

Following major losses in the local council elections, the Finance Ministry on April 18 instructed all SOEs to reduce their workforce by one-third as part of efforts to cut operating costs and strengthen expenditure management. On Tuesday, the Privatization and Corporatization Board (PCB) issued a circular ordering companies to complete the downsizing within three months.

Fayyaz said 14,733 employees would need to be removed to meet the 33 percent target. “That number of people are cut off and thrown to the streets. When they are thrown away, look at how many people depend on them,” he said, estimating the impact at more than 50,000 people.

He questioned whether the PCB had examined the reasons behind the increase in SOE staffing before ordering mass layoffs, and called for accountability for those responsible for unchecked hiring.

At the same press conference, Hassan Latheef, director general of MDP’s “Bodu Badhalu” campaign office, shared estimates of the number of employees each company would have to lay off. According to him, STO would need to cut 1,353 of its 7,100 employees, Fenaka 2,607 of its 7,900 employees, and MACL 1,980 of its 7,290 employees. He said 15 staff from the Hajj Corporation and 102 from Maldives Post would also be affected.

Last April, then-Finance Minister Moosa Zameer said SOEs employed an estimated 42,000 people. Some companies, including HDC and Fenaka, have already begun offering voluntary resignation packages to encourage employees to leave on their own.