Planning Minister Mohamed Aslam has said that a law should be passed to prevent government companies from entering the construction sector. The minister made the statement at the Parliament on Tuesday, while responding to a question posed by Vilifushi MP Hassan Afeef, asking him to clarify his views on government-owned companies working in sectors that are not within the purpose for which the companies were established.
The minister said government-owned companies were created to perform a particular task or provide a specific service. He said he did not support the companies getting involved in other work that is not part of the company's work in order to expand their business. He noted that the Planning Ministry did not usually assign works that are not within a company's mandate. However, the ministry assigned construction work to the Maldives National Defense Force (MNDF)'s company SIFCO due to MNDF refusing to hand over the work to another party as it had to be carried out within a security service agency, he said.
"Whether they are a company or a state institution, they were established for a separate purpose. I do not believe they should enter other sectors to expand their business," he said.
Aslam said there is no legal obstacle for government-owned companies to bid for projects announced by the ministry. However, the minister said that government companies should not get involved in such projects, and a law should be passed to stop them from doing so.
As per the Planning Ministry's policies, only companies registered as contractors with the Planning Ministry can bid for projects.
Aslam said that government companies entering into activities other than the purpose for which the government-owned companies were created might cause the companies to lose sight of the company's intended goals and objectives and not achieve the desired results.
"As the Planning Minister, I certainly do not welcome this, nor do I want this [to happen this way]. There are no government policies to introduce them into the construction industry," he said.
Aslam added that although he did not support the government-owned companies getting involved in government projects, some projects had been awarded to state-owned companies. Some of these works are being sub-contracted to other companies, he noted.
HIghlighting that some government companies are government-owned, the minister said there is opportunity to award projects to these companies without a bid. However, this opportunity must only be given to MTCC, as it is the only state-owned company that has the mandate to carry out construction work, he said.
The Planning Minister's comments regarding government-owned companies getting involved in projects that are not within their mandate come while some government-owned companies are investing heavily in some projects that are not within their scope.
Planning Minister Mohamed Aslam
