By Chandra Jayaratne

The Island of Saturday 14th May 2022, published a proposal, submitted by the former President Chandrika Bandaranaike Kumaratunga, to leaders of political parties and civil society organisations, wherein, admirably, the essential need for adequate representations, by youth and women in governance, are given recognition. Prior to that, the Bar Association of Sri Lanka (BASL) had submitted a 13-point proposal to restore economic and political stability in Sri Lanka. The writer respectfully recognizes the aforesaid proposals are caring leadership initiatives of significant value in the current socio-political and economic crisis risking the stability and future of Sri Lanka and its people.

The writer agrees with the short-term focus as set by the BASL stating as its objective:

* To create political, economic and social stability in the country.

* To create an environment to address the fundamental problems that have brought about the current crisis (and imperil future reforms).

* To restructure external debt and enter into appropriate programmes with multi-lateral institutions, including the IMF, and for that purpose to appoint the financial and legal advisers and negotiate a debt standstill pending debt restructuring.

* To obtain bridging finance. The bridging finance together with the savings arising from the debt standstill to be used to procure uninterrupted supply of essentials to the People until such time the debt restructuring, and the IMF programme is in place. This will eliminate the shortages in power, fuel, gas, medicines, food, etc.

* To create an environment to combat corruption and to ensure accountability and strengthening independent institutions.

And towards an overarching requirement of a stable government with the ability to implement reforms, domestically, and the ability/credibility to negotiate with the IMF, other multilateral agencies, and friendly countries to help Sri Lanka get out of the economic crisis.

However, this proposal has failed to take account of the need to use this crisis as an opportunity to introduce critical systems changes demanded by the ‘Aragalaya’ and implement critical change management options for long term good governance with democratic rights, equity, equality, and the rule of law being strengthened.

The writer wishes to take this opportunity to add a postscript to the submission by the former President; which appears to have inadequately focused on the severe economic crisis, threatening Sri Lanka and its people; and disregarded some key demands of the stakeholders of the ‘Aragalaya’ relating to governance failures, rejection of the leaders of the present regime, control of corruption, recovery of proceeds of crime; as well as address important unresolved national questions and the need for strengthening fundamental rights, equity and the rule of law.

The highlights of the post scripts are briefly outlined hereinafter and sets out amendments required to the proposal by the former President, whist incorporating some of the excellent suggestions in the 13-point proposal of the BASL:

1. The Interim Government to be for a maximum period of 18 months, in order to re-establish a stable and solvent governance structure, at the end of which the interim administration stands dissolved, enabling a people’s choice-based new government to be elected

2. The governing party and the leading opposition party to get one nominated member from each of their parties to resign and make way for the nomination, with the concurrence of the Parliament, of (a) a retired Chief Justice with judicial integrity, independence, impartiality and track record of acceptance and (b) a mature politician with public acceptance, integrity, independence and track record of achievement and no allegations of corruption and moral turpitude

3. The incumbent President to resign immediately post 2 above and the nominated member of parliament elected under 2(a) above be elected as the President by the Parliament and such appointee to not engage in executive decision-making nor be a member of the Cabinet: whilst the nominated member elected under 2 (b) be appointed the Prime Minister and bound by a Code of Prime Ministerial Conduct and Ethics, having transparently established the capability (knowledge, skills, attitudes and values) and having duly declared publicly the appropriate declarations of assets/liabilities and all interests of the Prime Minister and his immediate family: with the vacancy in the nominated members created by election of the President being filled in by a economist with extensive experience in public finance and macroeconomic management, who in addition being a person with integrity, independence and track record of achievement and no allegations of corruption and moral turpitude; and such nominee be appointed as the Minister of Finance and Economic Affairs Management. These new appointments to take place at the earliest option.

4. An interim Cabinet be appointed charged with the responsibility and accountability regards the direction and control of the government, being collectively answerable to Parliament and be bound by a Code of Ministerial Conduct and Ethics; with appropriate amendments to article 52 (2) of the constitution where “the Secretary to the Ministry shall be the chief accounting officer of the Ministry and answerable to Parliament and bound by a Code of Conduct and Ethics, and to function in such capacity, subject to the policy direction and guidance of his Minister; and such Secretary shall exercise the control and supervision over the departments of Government or other institutions in the charge of his Minister and be accountable for professional good governance and effective decision-making and implementation, within the functions assigned”.

5. The Cabinet comprising of 15 Ministers be appointed by the President on the recommendation of the new interim Prime Minister and endorsed by a majority of members of the Parliament, post such nominees having established their capability (knowledge, skills, attitudes and values), integrity, independence and track record of achievement with no allegations of corruption and moral turpitude and having duly declared publicly their declarations of assets and a interests of the ministers and their immediate family. The Interim Government, in consultation with all relevant independent groups, including the youth representatives currently leading protests and apolitical Professional/Trade/Civil Society organisations to appoint, with the concurrence of Parliament, an independent Advisory Council, consisting of 15 qualified professionals from disciplines corresponding to the 15 Ministries or relevant to the national economy priorities (as recommended by the BASL); and such Council to be formed in place of the Council of State for National Policy recommended in the former President’s proposal; and this Independent Council should act as advisors of the Cabinet and be consulted on all major policy decisions of the government; the interim government will seek every option to build consensus and support of all parties represented in Parliament and the Advisory Council and where possible key stakeholders of the economy; the interim government will endeavor to publish White Papers on all major policy changes and restructure options proposed and will use such publications to build awareness and debate amongst citizen groups; and take heed of any positive and value adding suggestions emerging from such consultations and public advocacy.

6. The interim government should take immediate steps in resolving to the best of its ability, the shortages of essential goods, medicines and fuel supplies and services experienced by citizens.

7. The currently functioning selected three overseas resident advisors charged with advisory on debt restructure, etc., together with two younger economists resident in Sri Lanka working outside the public services, be appointed as accredited ambassadors of Sri Lanka with Cabinet Ranking; and the five-member team will collectively with the Sri Lanka High Commissioner in India, the Governor of the Central Bank, Secretary to the Treasury and the newly appointed Minister of Finance be responsible to negotiate with the IMF, International Financial Organizations and Donor Countries; and also agree the essential fiscal consolidation measures, steps leading to stability of the financial and banking systems, bridging finance arrangements, agreeing a strategic plan to ensure debt sustainability by 2027, gaining acceptable sovereign ratings for the country and agreeing with creditors a programme of debt restructure; supported where necessary by external consultants and advisors with international expertise; and recommend such measures and action plans to be adopted by the new interim cabinet. The said team may appoint sub-committees made up of technocrats and persons with requisite expertise to support the development of reform agendas covering raising revenue to GDP to 12-15% over the next three years and enhance it to 18% by year six, where the ability to pay by those with capacity to contribute, bear the brunt of the enhanced taxes; and over time the ratio of indirect to direct taxes should move from 80/20 to 60/40;

State expenditure rationalisation, (with special focus on defence, administration and nonessential projects and capex), embedding strict austerity measures, national resource allocation prioritizations and justification assessments on economy, efficiency and effectiveness of approved spends seeking positive socio economic outcomes; and develop key long term budget assumptions, fiscal outcomes and fiscal responsibility key performance targets;

Develop plans to optimize value adding growth in GDP, gradually reaching 5-8% by 2027, with enhanced and diversified export incomes, promoting savings and local and foreign investments; to develop essential reform options, including policy and regulatory changes, digitization, fiscal adjustments and factor productivity enhancements along with other change management restructure options for long term growth and stability

designing an effectively administered ICT driven ‘Aadhaar’ type scheme for establishing a strong social “Safety Net” targeting to protect the interests of the elderly, poor, marginalized and vulnerable segments of society;

Identifying change management and restructure options for improved productivity, technological advancement, human resource development for the next generation of value optimization, quality and outcomes in the operations of ministries, departments, state establishments and state-owned enterprises.

8. The interim Government will be accountable for undernoted legal and regulatory reforms:

a. Promptly bring back the 19th Amendment to the constitution with appropriate amendments that remove well established weaknesses and operational lacunae for effective good governance; with democratic rights, rule of law and justice systems strengthened, whilst enhancing the operational scope and framework, financial independence, transparency, accountability with appropriate checks and balances of the Constitutional Council, Independent Commissions, the Central Bank and the Auditor General.

b. Introduce a new Constitution that abolishes the Executive Presidency replaced with a head of state; strengthens the system of governance with appropriate checks and balances and enhancing accountability of the executive; with no immunity for any actions of governance violating democratic rights, equity and equality of citizens, rule of law, mismanagement and failing to place the interests of the nation and its people first, in all executive decision-making; promoting equitable resource allocations, protection of the environment and recognizing the interests of the poor and vulnerable segments of society; introducing a bill of rights expanding and updating the Fundamental Rights chapter (including Socio Economic Rights): Resolving the National Question and facilitating the devolution of power going beyond the 13th Amendment; equating the rights of all citizens irrespective of race, religion or status and making way for a truly harmonious and peaceful plural society, with equity and equality in all respects enabling the establishment of a truly Sri Lankan identity, that celebrates unity in diversity; and change the electoral system to a mix of first past the post and proportional representation.

c. Introduce required law/regulatory reforms connected with combating corruption and recovery of proceeds of crime, by enacting a Proceeds of Crime Act (including powers of Civil and Criminal Forfeiture and Asset Management); Serious Financial & Organized Crime Agency Act; Company Law Reforms-(Expanding the Provisions of Part XXI- Offences of the Companies Act No. 7 of 2007) and incorporate changes and update bribery and money laundering laws and the criminal procedures code (including incorporating new offences identified in the United Nations Convention on Anti-corruption, e. g. Trading influence; Abuse of functions; Illicit enrichment; Embezzlement of property; Concealment (both private and public sector); Bribery in private sector; Bribery of foreign public officials): Networking the Inland Revenue, Customs, Excise, BOI, SEC, Central Bank and Financial Intelligence Units with a newly established Directorate of Revenue Enforcement and an Independent Office for Serious Financial Crimes prosecution, for collective initiatives in the Recovery of Proceeds of Crime and Illicit Financial Flows;

d. Enact and enforce Codes of Conduct and Ethics governing elected representatives and regulations governing conduct of election campaigns and campaign finances; and introduce necessary amendments to the Declaration of Assets and Liabilities Law enabling the publication of the declarations of Assets and Liabilities of elected officials; and a system of recall where any such elected member with established charges of engaging in any acts of corruption and/or acts of moral turpitude;

e. Enact necessary amendments to the Monetary Law or promulgate new legislation to strengthen the independence of the Central Bank of Sri Lanka and amend the Audit Act to empower the Auditor General to direct law enforcement units to investigate and take action against any acts of Corruption or mismanagement in the state and state-owned enterprises.

f. Set up a Parliamentary Budget Office and strengthen the powers of the Committee on Public Finance, COPE and COPA, empowering them to make recommendations to the law enforcement authorities for action or for the Auditor General to impose surcharge under the Audit Act (duly amended to include the Ministry Secretaries as well). Proceedings of above Committees as well as Consultative Committees of Parliament and Sectoral Oversight Committees be open to the public;

g. Introduce Codes of Conduct and Ethics binding high post holders and senior management in state services and state-owned enterprises and make all public servants and legislators bound by compulsory reporting of noncompliance with Laws and Regulations (NOCLAR)

h. Update the Right to Information Act and Victims and Witness Protection Act avoiding the present shortcomings;

i. enact necessary amendments to the Monetary Law or promulgate new legislation to strengthen the independence of the Central Bank of Sri Lanka

9. All persons appointed to the Constitutional Council, Advisory Council and by the Constitutional Council and other High Post holders be persons with public acceptance, integrity, independence and track record of achievement and no allegations of corruption and moral turpitude:

10. Enact law/regulatory reforms and undertake change management leadership initiatives which improve factor productivity including labour, educational, technological and administrative reforms which enhances opportunities for export of goods and services led growth, foreign direct investments, diversify export basket, improve labour productivity and quality improvements, transparent and cost effective procurement systems and tender awards ( including rationalization of public holidays and lay off commitments)

11. Adopt a foreign policy which supports the long-term national interests;

12. Appoint a Special Presidential Commission of Inquiry to investigate into and report on the persons directly and indirectly responsible for the present state of the economy and purported bankruptcy of the nation, causing so much suffering, losses, mental trauma with disrupted the lives and livelihoods of the stakeholders of the society; and recommend what action should be taken against them in terms of the law and regulations; and what damages can be recovered from them.

Former President’s “Political Crisis: A Way Out” proposal amended as above, read together with the BASL proposal can be taken up by the ‘Aragalaya Group’ in developing the proposed “Galle Face Declaration” to be endorsed by the new interim government as a precondition to the protestors ending this youth led struggle for a system change, combined with a regime change and a new option to select the post struggle a new governance structure and peoples chosen representatives.