Salary Increase for Executives of State-Owned Enterprises

Ministry of Finance has evaluated the performance of state enterprises and increased salaries for company executives.

It was revealed that the Finance Ministry increased the salaries of Managing Directors and Deputy Managing Directors of state-owned enterprises while categorizing companies and revising the remunerations for Directors, Chairmen, and Board Members.

A statement sent to the companies after government revision stated that Managing Directors of state companies at the lowest level will now have an MVR 10,000 to MVR 15,000 increase in their salaries.

According to the policy, Managing Directors of utility companies with bases on over 111 islands will now receive a monthly "hardship allowance" of MVR 16,000. Deputy Managing Directors are to receive a monthly allowance of MVR 12,800.

While Managing Directors are to receive MVR 12,300 as a "special social security allowance" monthly, Deputy Managing Directors are to receive MVR 9,840. Company boards require written approval from the finance ministry before passing the hardship allowance and special social security allowance.

The ministry stated that salaries of board members will now be decided based on one regulation and that the government previously evaluated the performance of companies under the same regulations as there was no policy to categorize companies to evaluate performance. While the state owns companies in a broad range of industries, the companies have faced difficulties in reaching financial goals, said the ministry.

As it is important to have regulations that allow companies to be categorized instead of evaluating companies' performance under one policy, minimum and maximum salaries for companies at levels "A", "B", "C", and "D" have been established.

As per the new policy, companies in the "A", "B", and "C" categories will receive an allowance between MVR 5,333 and MVR 30,000 based on marks received on the financial rating after review. Executives of companies in the "D" and "E" categories will receive an allowance of MVR 8,000 to MVR 30,000.

With the new policy, Managing Directors of higher-level companies will receive a salary of over MVR 113,000, and Managing Directors of lower-level companies can also receive up to MVR 80,000 after a performance review. The ministry, with the new policy, hopes to pave the way for salaries to be based on the work, responsibilities, and achievements of executives.