The Privatization and Corporatization Board (PCB) has instructed all government-stakeholder companies to reduce their workforce by 33% within three months as part of the government’s State-Owned Enterprise (SOE) rightsizing programme.
In a circular issued on Sunday, the PCB said the directive would take effect from July 13 onwards, and instructed government companies to achieve the workforce reduction target within the specified three-month period.
The board also ordered companies to submit weekly updates on the implementation of the rightsizing exercise. Companies must update the “SOE Right Sizing weekly changes” Excel tool and email it every Sunday to the Ministry of Finance and Public Enterprises and the PCB.
The PCB said compliance with its directives is mandatory for government companies, state-shareholder companies and state commercial enterprises under the Privatization, Corporatization, Monitoring and Evaluation of State-Owned Businesses Act (Law No. 3/2013).
Rightsizing SOEs has been a major pledge of President Dr Mohamed Muizzu’s administration, with the government seeking to reduce the size of the public sector and improve the financial sustainability of state-owned companies.
The directive comes as several SOEs implement workforce restructuring programmes. Fenaka Corporation has received voluntary resignation requests from 108 employees under a restructuring initiative. The company’s board-approved voluntary separation policy forms part of a wider effort to “right-size” its workforce, with employees retained by the company to be selected based on organisational requirements and staffing needs.
The workforce reduction exercise has also drawn allegations that employees are being targeted based on their political affiliations, with several local media outlets reporting claims that members or supporters of the main opposition Maldivian Democratic Party (MDP) are being targeted.
The issue has been raised during press conferences with President Muizzu. Responding to questions on the matter, the President has said employees found to have violated behavioural standards set by the PCB would be terminated.
The President has also linked the need to reduce costs at state-owned companies to the economic pressures facing the Maldives. He has previously said the conflict involving the United States, Israel and Iran and the resulting disruption to global energy markets, including the closure of the Strait of Hormuz, has contributed to higher oil prices and falling tourist arrivals, causing revenue losses in recent months.
He also said that no employee would be terminated based on their political affiliations or beliefs.
