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2025 Budget: Positive Welfare Measures, but Economic Concerns Remain, says Prof. Tissa Vitharana

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Tissa

Prof. Tissa Vitharana, leader of the Lanka Sama Samaja Party (LSSP), has welcomed several key aspects of the 2025 national budget, particularly its emphasis on social welfare, but raised significant concerns about the country’s economic trajectory, urging stronger action to avoid a return to bankruptcy.

One of the most promising features, according to Vitharana, is the prioritization of nutrition for the nearly 63% of families in Sri Lanka who struggle to access three meals a day. With malnutrition rates possibly doubling to 14.3%, Vitharana emphasized that Sri Lanka’s robust public health service is well-positioned to target the most vulnerable households. He expressed hope that the government would implement this initiative effectively, acknowledging the importance of addressing food insecurity in a country where many families are forced to subsist on one meal per day for adults and two for children.

Vitharana also lauded the government’s focus on promoting industrial development, particularly in the export sector, pointing to the successful Vidatha Program and SLINTEC, which he helped establish as former Minister of Science and Technology. He noted that over 30,000 entrepreneurs have emerged through the Vidatha program, and many are now contributing to the country’s export revenue. He urged the President and Finance Minister to ensure that the budget adequately supports this critical sector.

Another highlight of the budget, according to Vitharana, is the allocation for education, renewable energy, and digitalization. He also supported the government’s initiative to make use of the country’s oil tanks, which could potentially enhance energy security.

However, Vitharana expressed concerns regarding the health sector, particularly the severe shortage of essential medicines, many of which are imported at high prices. He pointed out that this shortage is causing immense hardship for those with chronic illnesses, particularly low-income individuals who cannot afford the high costs of private pharmacies. He called for greater attention to implementing the WHO-approved Senaka Bibile medicinal drug policy, which ensures affordable, high-quality medicines.

On the economic front, Vitharana criticized the government’s growing reliance on foreign loans, noting that recurrent expenditure is four times higher than capital expenditure. This, he argued, undermines the potential for economic development and may lead Sri Lanka back into a debt crisis. He also highlighted the situation in the rice market, where traders and mill owners are benefiting from higher prices while government reserves remain low.

Vitharana further expressed concern about the budget’s reliance on indirect taxes, which he believes will disproportionately burden the poor and middle classes, exacerbating income inequality.

In conclusion, Vitharana drew comparisons to the 1970s, recalling how LSSP leader Dr. N. M. Perera, as Finance Minister, navigated Sri Lanka through an economic crisis without raising taxes. He urged the current government to adopt similar strategies to avoid exacerbating the nation’s fiscal problems. He also referenced his COPA Chairman’s report in Parliament, which advocates for quicker tax collection from large corporations and tackling issues such as the ongoing elephant-human conflict.



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SJB flays PUCSL for shifting coal scandal losses to electricity consumers

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Sajith Premadasa

Alleging that the Public Utilities Commission of Sri Lanka (PUCSL) has shifted the massive losses, caused by the coal scam, to the hapless public, Opposition and SJB Leader, Sajith Premadasa, has questioned the conduct of the regulator, noting that it is mandated to protect the interests of both the service provider and the consumers.

Premadasa alleged that the PUCSL ignored the representations made by the SJB on behalf of local industries.

Premadasa said that the PUCSL had authorised the latest 18% increase, in response to the request made by the recently established National System Operator (Pvt) Ltd (NSO), on behalf of the NPP government.

The PUCSL was established in terms of the Public Utilities Commission of Sri Lanka Act, No. 35 of 2002. Although the PUCSL was supposed to function as a multi-sector regulator for electricity, water services and petroleum industries, successive governments refrained from bringing water services and petroleum industries under its purview.

The Opposition leader alleged that the PUCSL did the bidding of the government.

Since January this year, PUCSL has increased electricity tariffs on three occasions. The latest came into operation on 11 May.

The PUCSL consists of Prof. K. P. L. Chandralal (Chairman), Engineer Piyal Henanayake (Deputy Chairman), Dr. M.C.S. Fernando, and Lilantha Samaranayake, PhD.

Premadasa said that instead of taking tangible measures to recover the unbearable losses caused by the coal scam, the government burdened the entire country through the PUCSL.

“Don’t forget that the government is shielding its henchmen responsible for the coal scam at the expense of the country,” MP Premadasa said, pointing out that there couldn’t have been any dispute over their culpability, after the National Audit Office (NAO) found fault with the Energy Ministry for granting the tender for the supply of coal for the 2025/2026 season to a company not qualified even to participate in the tender process.

The SJB leader declared that the resignation of Energy Minister, Kumara Jayakody, and its Secretary, Prof. Udayanga Hemapala, in the immediate aftermath of Parliament defeating a no-faith motion against the Minister was meant to protect the ruling party.

The PUCSL has stated that the NSO received Rs 15 bn from the government to grant relief to 95% of the consumers. “How could the PUCSL justify unbearable electricity tariff increases for the remaining 5% of the consumers, knowing very well that it will destabilise key sectors in the economy?” a power sector expert said.

By Shamindra Ferdinando

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Rains bring relief to debt-ridden CEB as reservoirs fill; one dead, 62 families affected by adverse weather

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The widespread torrential rains currently experienced countrywide are expected to provide significant financial relief to the debt-ridden Ceylon Electricity Board (CEB) by sharply increasing hydroelectric power generation and reducing dependence on costly thermal and coal-powered electricity generation, power sector officials said yesterday.

Senior engineers of the CEB told The Island the rapid rise in water levels in major catchment areas and reservoirs had already strengthened hydropower generation capacity across the country.

Officials of the Irrigation Department confirmed that 33 reservoirs are presently spilling following continuous heavy rainfall over several parts of the island.

Among the major reservoirs spilling are Rajanganaya, Lunugamwehera, Weheragala, Deduru Oya, Nalanda and Wemedilla reservoirs, while several spill gates have been opened to release excess water due to heavy inflows into the catchment systems.

An Irrigation Department engineer said catchment areas linked to the Mahaweli, Kala Oya and southern river basins had received exceptionally heavy rainfall over the past several days.

“The inflows are extremely high. Reservoir capacities are increasing rapidly and this is highly beneficial for irrigation, water supply and hydroelectric generation,” the official said.

CEB engineers explained that the increase in reservoir storage levels would enable the Board to maximise hydroelectricity generation from major hydropower stations linked to the Mahaweli and Laxapana systems.

A senior CEB engineer said hydropower remained the cheapest electricity source available to Sri Lanka.

“Hydro generation costs are minimal compared to thermal generation. Once reservoirs fill up, we can considerably reduce expensive oil-based thermal generation,” the engineer said.

According to power sector estimates, hydroelectricity generation costs remain below Rs. 5 per unit, whereas coal-fired electricity generation costs range between approximately Rs. 18 and Rs. 25 per unit depending on international coal prices and exchange rate fluctuations.

Diesel and furnace oil-powered thermal generation are significantly more expensive, costing between Rs. 40 and Rs. 70 per unit.

CEB officials said the prevailing rainy conditions were therefore producing enormous savings for the financially-strained utility.

Daily electricity demand currently fluctuates between 45 million and 50 million units. One unit equal 1 kWh. One million units 1 GWh.

Energy sector estimates indicate that if hydropower generation replaces between 10 million and 15 million thermal-generated units daily, the CEB could save between Rs. 350 million and Rs. 900 million per day depending on the displaced fuel source.

Even replacing coal-powered generation alone could save between Rs. 150 million and Rs. 300 million daily.

“The present rains have arrived at a critical time for the CEB. Higher hydro generation means lower fuel imports, reduced thermal dispatch and major savings for the utility,” another senior engineer said.

Meanwhile, the prevailing adverse weather has also caused fatalities and damage in several districts.

The Disaster Management Centre (DMC) said one person had died while 62 families in four districts had been affected by the severe weather conditions.

The fatality was reported from the Koralai Pattu South Divisional Secretariat Division in the Batticaloa District.

According to the latest DMC situation report issued at 10.00 p.m., 17 Divisional Secretariat divisions across four districts have been affected by the disaster situation caused by the severe weather.

Some 203 persons belonging to 62 families have been affected so far, while 17 people are currently being accommodated at safe shelters.

The DMC further stated that 39 houses had been damaged due to the prevailing adverse weather conditions.

Meanwhile, the Department of Meteorology issued a red warning for heavy rains in several parts of the country.

The Met. Department said the prevailing showery conditions were expected to continue further due to the low-pressure area in the vicinity of Sri Lanka.

Very heavy showers exceeding 150 mm are likely at some places in the Western, Sabaragamuwa, Central and Northwestern provinces and in the Galle and Matara districts.

Heavy showers of about 100 mm are also likely at some places elsewhere across the island.

The Disaster Management Centre yesterday urged the public to take adequate precautions to minimise damages caused by heavy rain, strong winds and lightning during thundershowers.

By Ifham Nizam

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President orders acceleration of Ditwah relief programmes

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President Dissanayake

President Anura Kumara Dissanayake directed officials to fast-track the completion of the resettlement process for people in the Kandy District who lost their homes due to the recent Ditwah disaster. Speaking at a Special District Coordinating Committee meeting held at the Kandy District Secretariat on the 12th, the President reviewed the progress of land acquisition for resettlement at the Divisional Secretariat level.

The President emphasised the urgent need to resolve existing administrative hurdles and ensure that affected families are provided with permanent housing solutions without further delay.

During the session, the President individually consulted Divisional Secretaries on the progress of compensation for the 12,169 houses reported as partially damaged within the district. According to official data, while 4,488 families are currently eligible, only 3,038 have received compensation thus far. The President also highlighted the status of 1,583 high-risk houses requiring full resettlement and thousands of others awaiting NBRI technical reports. He instructed officials to expedite the remaining payments and clear the backlog of inspections to ensure all victims receive their due relief.

Addressing the long-term safety of the community, President Dissanayake noted that it was the government’s primary responsibility to prevent residents from returning to identified high-risk zones. The discussion focused on identifying new lands for relocation, with special attention paid to the plantation community living on private estates. Plans were discussed to reclaim government lands currently managed by private companies to facilitate these housing projects.

Additionally, the President addressed the construction of retaining walls for houses where land stabilisation is necessary and promised a solution within the coming week regarding the fluctuating prices of construction materials and compensation for business losses.

The high-level meeting was attended by a distinguished gathering, including Minister of Agriculture K.D. Lalkantha, Central Province Governor Professor Sarath Abeykoon, and Deputy Ministers Hansaka Wijemuni and Prasanna Gunasena. Several Members of Parliament, including Jagath Manuwarna and Riaz Farouk, also participated alongside the Mayor of Kandy, the District Secretary, and various heads of state departments and security forces. The collective presence of these officials underscored the government’s commitment to a coordinated and swift recovery effort for the Kandy District.

By S.K. Samaranayake

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