Finance Minister Moosa Zameer has sent a letter to all government agencies directing them to cut the monthly allowance for new retirees from January 2025.
Zameer, who is also the President of the National Pay Commission, said the move was part of the government's policy of reducing expenditure.
Finance Ministry did not confirm the details, but the Civil Service Commission (CSC) confirmed the decision.
CSC President Mohamed Nasih told Adhadhu that the letter stated existing retirees will continue to receive the monthly allowance.
"It states that the government wants to make the deduction under the government's cost-cutting policy from January 1. It means that people who retire from January 1 will not get [the allowance] in the future. But those who have retired so far will continue to receive it," Nasih said.
He noted that new retirees will receive the one-time lump sum payment as before, adding that only the monthly allowance was cancelled.
The retirement pension scheme, which was introduced in 2009, is operated by 13 government agencies and is expected to cost MVR 272 million next year. The scheme is expected to cost a total of MVR 266 million this year.
The state's expenditure on pension is increasing year by year. With cost-cutting measures to be introduced next year, the government has already decided to not provide the MVR 5000 monthly allowance to wealthy senior citizens.
