Audit Finds MVR 59.35 Million Spent on Parking Systems That Never Became Operational

The state spent MVR 59.35 million on an automated parking system project in Malé and Hulhumalé without completing or bringing a single facility into operation over a decade, according to a compliance audit by the Auditor General’s Office.

The audit of the former Ministry of Construction, Housing and Infrastructure’s financial records found that the project proceeded without documented feasibility studies, competitive bidding for some payments and required financial safeguards.

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The project was initially announced in 2015 as a response to the shortage of parking spaces and traffic congestion in Malé. The plan was to install mechanical parking systems that could accommodate both cars and motorcycles without requiring large areas of land.

In 2016, the ministry contracted the State Trading Organisation (STO) to install 20 systems across Malé, comprising 10 for cars and 10 for motorcycles. The systems were expected to provide a total of 1,160 parking spaces, according to reports at the time.

Mechanical parking systems in Hulhumalé, which were expected to accommodate more than 200 vehicles and open to the public in January 2021, remain unfinished, with none of the systems covered by the project completed or operational as of 5 October 2026, according to the Auditor General’s latest inspection.

While that contract was still in progress, the ministry signed a separate MVR 14.48 million agreement with a foreign company on 26 June 2018 to install another 14 systems.

However, auditors found no documentation showing that a feasibility study had been conducted before the government committed funds to assess the project’s technical viability or potential economic benefits.

The project was suspended following the change of government in 2018, by which time MVR 59.36 million had been disbursed. The ministry attempted to resume the works in 2022 by appointing another contractor, but auditors found that none of the parking systems had been completed or made available for public use when they inspected the project in October 2026.

Of the MVR 59.36 million disbursed, MVR 43.32 million went to STO’s subcontractor, MVR 9.81 million was paid directly to STO, and the ministry paid a further MVR 6.23 million to the subcontractor.

The audit identified MVR 13.86 million in payments made without competitive bidding or evaluation by the tender board. This included MVR 9.81 million paid to STO and MVR 4.06 million paid to another contractor without a formal written contract or evidence that any parking system had been completed.

The ministry also paid MVR 1.46 million to a new contractor as a 15 per cent advance payment for remaining works after terminating STO’s subcontractor in 2018. The payment was made without obtaining the advance payment guarantee required under the Public Finance Regulation.

Auditor General Hussain Niyazy recommended that the ministry recover the MVR 1.46 million advance payment and conduct an internal investigation under the Public Finance Regulation to establish responsibility for the project’s failure and the loss of public funds.