MDP takes legal action to overturn amendments to Decentralization Act

Opposition Maldivian Democratic Party (MDP) has filed a petition in the Supreme Court seeking to overturn the government's recent amendments to the Decentralization Act. The court has yet to decide whether it will hear the case.

Despite objections from over 60 councils and MDP, President Dr Mohamed Muizzu ratified the amendments on the 15th of this month. A key change prohibits local authority companies on islands from conducting business valued below MVR 10 million, requiring such activities to cease within 90 days of the amendment taking effect.

The government claims the amendment aims to strengthen small and medium enterprises (SMEs) in islands, with the President stating that councils can use profits from larger investments to provide services to the public.

However, MDP argues the changes will strip councils of their authority, leaving councilors with no meaningful role beyond receiving their salaries.

The MDP government had empowered councils to establish their own companies to generate independent income, recognizing that government grants alone were insufficient to cover all council expenses. However, the party has raised concerns that the recent legal amendments will now hinder councils from generating their own revenue.