Maldives Cabinet Granted Sweeping Powers to Approve No-Bid Government Contracts

The Maldivian government has expanded its procurement powers to allow the awarding of government contracts without a competitive bidding process, following a controversial amendment to the Public Finance Regulation that gives the Cabinet authority to authorise single-source procurement for virtually any project.

The amendment, gazetted late yesterday, revises Article 10.20 (b-1) of the Public Finance Regulation to permit state institutions to carry out projects “pertaining to basic needs of the people, enhancement of quality of living, and security services” through single-source procurement  provided they receive approval from the Cabinet or a committee it forms.

Previously, single-source procurement was restricted to emergency cases or situations where competition was not possible due to the nature or value of the project. The new rule significantly widens the scope, effectively allowing no-bid contracts for almost any government project that the Cabinet deems to meet the criteria.

Finance Minister Moosa Zameer now has additional discretion to waive standard safeguards such as bid security or performance guarantees for projects approved under the Public Sector Investment Programme (PSIP). Ministries and state agencies undertaking such projects are required to report progress regularly to the Ministry of Finance.

The change comes as the administration of President Dr. Mohamed Muizzu faces mounting criticism over the growing number of lucrative contracts awarded to state-owned enterprises instead of private firms. Critics warn that the latest amendment risks further reducing transparency, weakening competition, and increasing opportunities for corruption.

Government officials, however, have defended the move, arguing that it will accelerate infrastructure development and improve the government’s ability to deliver public services efficiently. Supporters of the amendment say it will cut bureaucratic delays and enable swift implementation of projects related to housing, utilities, and national security.

Civil society organizations and economic analysts have voiced concerns that the new powers could be abused unless accompanied by strict oversight and accountability mechanisms. They have urged the Finance Ministry to publicly disclose all single-source contracts approved under the new framework to ensure transparency.

With the amendment now in effect, every no-bid project will require Cabinet or Cabinet committee authorization. However, observers note that the true impact of the regulation will depend on how transparently these powers are exercised — and whether the government can balance its drive for efficiency with the need for fair competition and public trust.