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Debt restructuring: Opp. won’t accept President’s assurances; COPF examines proposals

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By Shamindra Ferdinando

SJB MP Dr. Harsha de Silva said that the all-party Committee on Public Finance (COPF) would have to examine the proposals presented by the Central Bank of Sri Lanka (CBSL) and the Treasury as regards the proposed domestic debt restructuring.

COPF Chairman de Silva said that the CBSL and Treasury representatives appeared before the watchdog committee yesterday (28) and tomorrow. Commercial Banks, EPF and other relevant institutions would appear today (29).

COPF would meet again on Friday to address outstanding issues, MP de Silva said.

The SJB economist said so when The Island sought his response to President Ranil Wickremesinghe’s declaration that the domestic debt restructuring wouldn’t be detrimental to the banking sector. The President also dismissed the Opposition’s claims that the proposed measures would have an impact on interests on bank deposits, the EPF, etc. President Wickremesinghe also holds the Finance portfolio.

Dr de Silva, a former UNP State Minister, emphasised that the SJB’s ‘Economic Blueprint’- a 10-point programme, which spelt out how to achieve stabilisation and equitable growth. He said he and his party were against domestic debt restructuring, but if absolutely necessary then the government should re-profile debt without hurting the public. He said there should be no face value haircuts; there could be maturity extensions with necessary regulatory measures to deal with capital adequacy issues so that there will be no adverse impact on individual depositors or EPF members, and the CBSL would be able to ensure liquidity for banks. “If done properly, the risk premiums will disappear and interest rates will fall. Will be positive for borrowers as well as banks … and will help growth.”

Speaker Mahinda Yapa Abeywardena yesterday issued a special gazette notification regarding the convening of Parliament on Saturday at 9.30 am. Director Legislative Services and Acting Director Communication, Parliament Janakantha Silva said that the announcement had been made in accordance with Standing Order 16 at the request of Prime Minister Dinesh Gunawardena.

Dr. de Silva said that the SJB had made its position clear ahead of the current crisis though the government continuously misled the public.

Top Opposition Spokesman Prof. G.L. Peiris said that their stand on the issue would not change simply because of a declaration made by President Wickremesinghe at a public event in Gampaha. Recalling the way the Wickremesinghe-Rajapaksa government had failed to brief Parliament on the IMF bailout package until the finalisation of the agreement in March, Prof. Peiris said that the basic problem was a chronic lack of clarity in the government’s stand. “Whether domestic debt restructuring is to take the form of coupon cut, haircut or adjustment of time of maturity is not clear. The idea is to take the country and, in particular, the banking system by surprise when the markets are shut down for five days. This has inevitably fuelled harmful speculation. Parliament and the Opposition have been taken for granted. The Business Committee meeting was postponed from Tuesday to Friday, and then the issuance of a special Gazette by the Speaker prior to the Business Committee meeting. Smoke and mirrors approach deprives the entire process of much needed candour and transparency. We therefore stand by the assessment we have already made.”



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Low-quality coal pushes power plant losses to Rs. 8.5 Bn

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The procurement of substandard coal for the Lakvijaya Power Plant has led to a sharp rise in coal consumption for electricity generation and caused an estimated loss of Rs. 8,497 million to the government, according to a report by the Public Utilities Commission of Sri Lanka (PUCSL).

National Secretary of the Electricity Consumers’ Association, Sanjeewa Dhammika, said the PUCSL report had revealed that the use of low-quality coal had severely affected both the operational efficiency of the power plant’s generation units and its financial performance.

According to the report, the production of one unit of electricity using coal supplied by the previous supplier required only about 0.046 kilogrammes of coal, whereas the same unit produced using coal from the new supplier required 0.093 kilogrammes.

“This means coal consumption per electricity unit has increased by 102 per cent, clearly indicating a significant deterioration in the quality of the coal supplied,” Dhammika said.

He added that the PUCSL report had estimated the financial loss incurred by the government from the first to the ninth coal shipment at Rs. 8,497 million, mainly due to the increased coal consumption resulting from the inferior quality of the fuel.

The report has also pointed to possible violations of the coal supply agreement. According to Clause 8 of the agreement, coal stocks should not be used until their quality has been verified through the required testing procedures.

However, the report reveals that the coal shipments in question had been used for electricity generation before the completion of the mandatory quality tests.

Dhammika stressed that under such circumstances there was no justifiable basis to increase electricity tariffs, warning that the public should not be burdened with the cost of losses arising from procurement irregularities.

“Do not attempt to increase electricity tariffs. The public cannot afford it. These losses should be recovered personally from those responsible, including the Minister, the Secretary to the Ministry, and the officials who served on the procurement committee,” he said. He also called on the Attorney General’s Department to take immediate legal action over what he described as knowingly causing financial losses to the state.

Dhammika urged the Attorney General to file indictments and ensure that those responsible for the alleged irregularities are held accountable under the law.

By Anuradha Hiripitiyage ✍️

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New Basnayake Nilame of Kandy Sri Pattini Devalaya to be elected today

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The election to appoint the new Basnayake Nilame of the historic Kandy Sri Pattini Devalaya, one of the four main Devalayas associated with the Sri Dalada Maligawa, will be held today (06) at 10.00 AM at the Kandy District Secretariat.

Current Acting Basnayake Nilames of the temple, Hemantha Bandara Herath, and the Basnayake Nilame of the Pattini Devalaya affiliated to the Matale Wilgamuwa Sonuththara Rajamaha Viharaya Dhammika Anuruddha Bandara Ekanayake are contesting for the position. These two candidates are close relatives.

Reports also indicate that the Basnayake Nilame of the Lankatilaka Sri Vishnu Devalaya Priyantha Amunugama may also contest. The appointment will be finalised after the names of the candidates are proposed and seconded. The standard procedure for this post requires that if there is more than one candidate, a vote be taken under the supervision of the Commissioner General of Buddhist Affairs, and the individual securing the majority of votes will be elected as the Basnayake Nilame.

Seven Divisional Secretaries of the Kandy District (excluding female Divisional Secretaries) and approximately fifteen lay custodians and Basnayake Nilames of ancient temples and Devalayas are reportedly eligible to cast their votes in today’s proceedings.

Unlike the election for the Diyawadana Nilame of the Sri Dalada Maligawa, where the chief incumbents (chief monks) of ancient temples are entitled to vote, they do not hold voting rights in this particular election.

By S.K. Samaranayake ✍️

 

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FR petition challenges detention of former SIS chief Sallay

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A retired officer of the Sri Lanka Air Force has filed a Fundamental Rights petition in the Supreme Court of Sri Lanka challenging the 90-day detention order imposed on former State Intelligence Service chief Suresh Sallay under the Prevention of Terrorism Act (Sri Lanka).

The petition names the Minister of Defence, the Secretary to the Ministry of Defence, the Secretary to the Ministry of Public Security, the IGP and the CID as respondents.

The petitioner argued that the Prevention of Terrorism Act is applicable only in cases involving actions aimed at undermining the country’s unity and territorial integrity or activities supporting the unlawful overthrow of a constitutionally elected government.

He pointed out that no such charges had been formally brought against Sallay.

The petition further states that although the Act was used in relation to activities of the Liberation Tigers of Tamil Eelam and during the 2022 protests, there was no evidence linking the Easter attacks to attempts to overthrow the government.

It has also been noted that the CID has not so far preferred any charges or evidence against the retired intelligence chief under the Prevention of Terrorism Act.

Filed as a Public Interest Litigation, the petition seeks a declaration that the detention order amounts to a violation of fundamental rights.

The petitioner also requested the court to direct the CID to either frame charges against Sallay under the Act or, in the absence of sufficient evidence, issue appropriate relief in his favour.

 

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