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Editorial

Boosting state revenue

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Monday 29th April, 2024

The Committee on Public Finance (COPF), headed by SJB MP Dr. Harsha de Silva, is reported to have called upon the government to re-evaluate its tax policies, systems and mechanisms to boost state revenue. It has reportedly explained revenue losses in terms of what has come to be known as the Laffer curve, according to which when tax rates are extremely high, they lead to a decrease in taxed activities such as investment and consumption, causing a drop in state revenue, and when tax rates are too low, they fail to yield sufficient revenue for the state.

The SLPP government, under President Gotabaya Rajapaksa, did away with some taxes and slashed others at the expense of state revenue, but it has, under President Ranil Wickremesinghe, moved to the other extreme. The need is for a via media.

Citing reasons for the drop in state revenue, the COPF has highlighted the Excise Department’s failure to bust the fake revenue sticker racket and collect duties on liquor efficiently. However, impervious to logical reasoning and wise counsel, the government continues to labour under the misconception that jacking up taxes is the only way to boost state revenue although unconscionable tax increases lead to tax avoidance or evasion and promote the growth of the so-called underground economy.

The government does not curtail its wasteful expenditure for state revenue to increase. It has embarked on a campaign to shower handouts on the poor ahead of the upcoming presidential election to compass its political ends despite calls for it to rationalise welfare expenditure and ensure that poor relief is properly targeted. State funds are also wasted on useless government ceremonies and politicians’ junkets. Corruption, which is rampant among government politicians and officials, also causes huge losses to the state coffers, as evident from the Health Ministry procurement scams.

The COPF has expressed serious concern about the inordinate delay in digitalising the excise duty collection process. If the Excise Department as well as other revenue-generating agencies such as the Customs could be rid of various malpractices, which deprive the state coffers of billions of rupees annually, perhaps it may be possible to pass the benefits of revenue increases therefrom on to the public. It is the corrupt who fear and resist digitalisation, which could be considered the most efficacious antidote to corruption, for it engenders transparency.

It is hoped that the government will heed the COPF guidelines for increasing state revenue by preventing losses and eliminating waste instead of burdening the public with more taxes.

Fish or cut bait

The SJB and the JVP-led NPP keep challenging each other to a debate on the current state of the economy and how to revive it. At this rate, one wonders whether the debate will ever take place. The two parties are only wasting their time and energy. Given the appalling nature of parliamentary debates on economic affairs and other such vital issues, it is doubtful whether a debate between two Opposition parties, the SJB and the NPP, will leave the public any the wiser.

If either the SJB or the NPP has an alternative to the government’s economic recovery strategy and really feels for the country, it ought to unveil its silver bullet without further delay. There should be ample time for the economic programmes of the SJB and the NPP to be evaluated properly before the next election so that the public will be able to see if they are feasible.

The upcoming battle for the coveted executive presidency will be fought on the economic front. Having been taken for a ride, the public cannot be unaware that it is a mistake for their political allegiances to take precedence over their concerns about the economy. They are not likely to be swayed by promises and political rhetoric again while reliving hardships, shortages of essentials and winding queues.

If the SJB and the NPP are serious about having a debate on the economy, they should have a discussion, decide on a date and be done with it. Let them be asked to fish or cut bait.



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Editorial

Super mandate and sobering reality

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Monday 18th November, 2024

Following their stunning victory in last week’s parliamentary election, the JVP/NPP leaders must still be pinching themselves to make sure that they are not dreaming. Their mammoth majority is sure to go down in Sri Lanka’s history. However, the bigger the majority, the greater a government’s responsibility and the higher the possibility of the public expecting miracles and becoming frustrated. Above all, the Actonian truism that absolute power corrupts absolutely has stood the test of time. Giving politicians, especially untested ones, steamroller majorities could be just as much a recipe for disaster as keeping teenagers, alcohol and car keys together.

It was somewhat reassuring that JVP General Secretary Tilvin Silva lost no time in appearing on television on Friday and promising that the NPP government would handle its super majority carefully and responsibly. However, one expected that assurance to come from the General Secretary (GS) of the NPP, and not the GS of the JVP, which says it is only part of the NPP. Nevertheless, Silva’s pledge will go a long way towards allaying doubts and suspicions in the people’s minds as regards steamroller majorities. One can only hope that the JVP/NPP will honour its word.

The NPP government will have to knuckle down to work forthwith and make good on its promises. It faces a steep learning curve. The new government is full of novices, and most ministers to be appointed will have no experience whatsoever with governance, and there could arise a situation where the political authority becomes heavily dependent on the highly unpopular bureaucracy, as never before. Officialdom is as much responsible as previous governments for Sri Lanka’s current predicament and the resultant public resentment, which the JVP/NPP tapped to propel itself to power.

President Gotabaya Rajapaksa, a political greenhorn, became overdependent on public officials like P. B. Jayasundera, and the so-called professionals, such as doctors and university dons, failed pathetically. Behind every mega racket in the state sector, there is a rogue public official. The fake immunoglobulin fraud in the Health Ministry is a case in point. The fact that the members of the public service, which has become synonymous with inefficiency, callousness and corruption, threw their weight behind the NPP in the last two elections does not mean they are ready to mend their ways, work diligently, enhance their productivity and cooperate with the new government to achieve its goals for the sake of the country. There’s the rub.

The new government will find itself in the same bailout straitjacket as its predecessor, and the IMF, which is at the beck and call of the western bloc, is no respecter of popular mandates in the developing countries. So, whether the NPP government will be able to do things differently on the economic front remains to be seen. Unless it toes the western line, it will have screws being tightened by the international lending institutions.

The National People’s Power government ought to bear in mind that ‘People Power’ entered the political lexicon following a popular uprising in the Philippines in 1986 against dictator Ferdinand Marcos, who was backed by the US, which is now pontificating to Sri Lanka on the virtues of good governance. Marcos, whose regime was notorious for corruption and oppression, was ousted for more or less the same reasons as the Rajapaksa government.

But, in 2022, Filipinos elected Bongbong, son of Marcos, as their President. Ironically, his only qualification was that he was the scion of the Marcos family! Similarly, the forces the JVP/NPP boasts of having vanquished, are likely to make a comeback if the self-proclaimed liberators fail to carry out their promises. There have already emerged small pockets of resistance to the NPP’s clean-up campaign; Chamara Sampath (Badulla) and Rohitha Abeygunawardena (Kalutara) have retained their seats! These pockets could act like Covid clusters with the passage of time.

The NPP takes pride in having won handsomely in the North and the East as well in the recently-concluded general election—and justifiably so. That was a singular achievement. But would the people of the North and the East have been able to exercise their democratic rights, especially franchise, much less vote for political parties of their choice, if the LTTE had been around? The JVP did not support the country’s war against the LTTE. Most of all, whether the NPP will be able to retain its popularity in the North and the East will depend on how it handles contentious issues such as devolution and the UNHRC resolutions against Sri Lanka.

Riding a massive wave of anti-politics, the JVP/NPP succeeded in creating a kind of political Morton’s fork—a dilemma in which both choices are equally unpleasant—for the public by lumping its rivals into two groups, the Rajapaksa camp and others represented by the UNP, the SJB, etc.; it vilified both groups as corrupt, inefficient and worthless, while presenting itself as the only saviour. For this purpose, it had the public believe that the country had gained absolutely nothing during successive governments since Independence (1948). If so, how come an office aide’s son from Tambuttegama received free education and graduated from a state university with a science degree, and went on to become the President of Sri Lanka? It is thanks to successive governments that democracy has survived two JVP uprisings and a protracted war for the people to elect governments. The vast majority of professionals in the JVP/NPP, have also benefited from free education, free healthcare, etc.

True, most of the previous governments were characterised by corruption and abuse of power, and they contributed to the present economic crisis, but that does not mean that the country has not achieved anything since Independence, as evident from numerous development projects, impressive health indicators and high literacy rate. Interestingly, didn’t the JVP opt for honeymoons with the governments it keeps condemning, from 1970 to 2019? It was part of the SLFP-led UPFA government, which was in power from 2004 to 2010.

What made the NPP’s impressive electoral victories possible was the unstinting support of the ‘voters of passage’, who shift their political loyalties, based on changing circumstances, their own interests and the prevailing political climate. There is reason to believe that most of those who helped raise the NPP’s votes from a meagre 3% to a whopping 61% and its parliamentary seats from a mere three to a stunning 159 within just four years are the ones who voted overwhelmingly for Gotabaya Rajapaksa in the 2019 presidential race and for the SLPP in the 2020 general election and subsequently resorted to punitive voting against the Rajapaksas owing to contrition. Many of them are also known for virtue signaling. One of the biggest challenges before the NPP government will be to retain their support in future elections, especially the local government and provincial council polls slated for 2025.

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Editorial

‘Twas a great victory

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The results of Thursday’s parliamentary election were still trickling in as this is being written on Friday but it was clearly evident that President Anura Kumara Dissanayake’s NPP/JVP, or the Malimawa (Compass – its election symbol) as it is best known, has clinched a historic victory winning better than a two thirds majority in the 225-member legislature. They won all but the Batticaloa district, a stupendous performance by any reckoning and Sri Lanka must hope that the rulers will deliver on the faith reposed on it by the whole country and all its ethnic and religious communities.

Though AKD polled less than 50 percent of the total votes cast at last September’s presidential election, he was comfortably ahead of his nearest rivals, Sajith Premadasa and Ranil Wickremesinghe. Apologists for both the losers attempted to devalue the victory by saying 48 percent of the electorate voted against the winner. They were of course conveniently ignoring the glaring fact that his opponents did worse. Much worse.

It was perhaps the numbers game that fueled the belief and hope among some opponents of the Malimawa that all was not lost with the executive presidency going elsewhere. They hoped for a parliamentary majority either individually or collective only to have those hopes shattered on Thursday. The executive presidency which was the fount of almost all ruling power was installed by President J.R. Jayewardene after his landslide five sixths majority election of 1977.

It must be remembered that JRJ swept to power on the basis of the easier previous first-past-the-post Westminster system of government where the winner takes all. The old fox instituted the proportional representation (PR) system of elections where the losers have a stake, with the conviction that there would never again be landslides. But he was proved wrong even before Thursday’s momentous performance by the NPP/JVP.

What is perhaps most extraordinary in this Malimawa victory is that the NPP/JVP took the Northern constituencies as never done before by southern party. AKD had a very successful rally in Jaffna in the days before the election and it was reported that a leading Tamil politicians had alleged that the president’s party had bused Sinhala people for that event – a common practice in Sri Lanka electioneering. A leading member of the winning combine said said after the result that this was a blatant falsehood and the results probably proved him right.

Tamils can vote for Sinhala candidates and did so in the past. Older readers will remember that Mr. Hector Kobbekaduwa, running on the SLFP ticket after Mrs. Bandaranaike was disenfranchised, against President JR Jayewardene in this country’s first presidential election in 1982, did very well in the north. JRJ was constitutionally “deemed” president in 1978 having swept the parliamentary election a year earlier but was not elected as president the first time round.

Kobbekaduwa’s success in the north when he ran for president was attributed to his banning, as agriculture minister, the import of onions and chilies earning northern farmers growing these crops windfall profits. In fact he was garlanded with onions and chilies when he campaigned in the north.

The electoral success of those who will govern this country for at least the next five years holds out the very real prospect that Sri Lanka will at last be able to successfully address the long festering communal problem. In the country’s first general election in 1947, the UNP which governed till 1956 was able to field candidates in the Tamil majority areas and win some seats. Though elected on the All Ceylon Tamil Congress ticket, Mr. GG Ponnambalam served the first DS Senanayake cabinet. When Prime Minister Dudley Senanayake in 1965 formed his seven party coalition, derisively dubbed the hath havula by his opponents, Mr. M.Tiruchelvam, a retired Solicitor General, was nominated by the Federal Party to serve in the cabinet.

But with the Dudley – Chelvanayakam Pact failing like the Bandaranaike – Chelvanayakam Pact before it, there was a tendency for only cosmetic presence of so-called “Colombo Tamils” like Mr. Chelliah Kumarasuriar in Mrs. Bandaranaike’s time, to serve in the cabinet. For sure President Chandrika Bandaranaike Kumaratunga used the National List to bring a man of high caliber, Mr. Lakshman Kadirgamar, to parliament. He was made foreign minister and it is unarguable that he was the finest this country ever had during a most difficult phase in its history. It has been credibly reported that CBK wanted to make him prime minister but that effort was successfully thwarted by Mahinda Rajapaksa.

But all this can change now and it remains to be seen how President AKD and his government will seize this opportunity. Abolishing the executive presidency was one of its pledges. Many of his predecessors promised to do so and welshed on their solemn undertakings. Will AKD, holding the powerful office, seek to abolish it or in the interim clip some of its wings? His promise to do away with the unnecessary and extravagant retirement benefits of former presidents have struck a responsive chord with the electorate.

More than any other, his promise to rid the country of endemic corruption and bring the guilty to book, was widely welcomed. It is well known that many of this country’s leaders have participated in or consorted with corruption. While totally eradicating it at all levels of society will be a Herculean task, ridding it at the top will be less difficult. The new president and his party undoubtedly have the will. But will they have the way?

We have always taken the view that too powerful governments and too weak oppositions are dangers to democracy. The electorate has vested the new president and his administration with near absolute power that must be circumspectly used in the national interest. The losers too must realign and for a start whether the UNP and SJB can reunite is an inevitable question.

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Editorial

‘Maroon Wave’ and AKD Magic

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Saturday 16th November, 2024

The JVP-led NPP has achieved the unthinkable. It made history when it swept Thursday’s general election and bagged all electoral districts except one. This is something unprecedented in this country. The NPP polled a staggering 6,863,186 votes (61.6%) and secured as many as 159 seats. ‘Even the ranks of Tuscany could scarce forbear to cheer’. Hardly anyone would have expected a political party to secure a two-thirds majority outright under the Proportional Representation (PR) system, but the NPP not only achieved that extremely rare feat but also delivered a kind of coup de grace to the Opposition, which will take a long time to recover. The UPFA and the SLPP mustered two-thirds majorities in Parliament, but they did so by engineering crossovers after obtaining 144 and 145 seats in the 2010 and 2020 general elections, respectively. The SJB came a poor second by obtaining 1,968,716 votes (17.7%) and 40 seats.

NPP leader Anura Kumara Dissanayake could not win the presidency outright in September; he received only 5,634,915 votes (42%) and therefore a preferential vote count had to be taken for him to be declared the winner, but he steered his party to a stunning victory two months later.

One may recall that the JVP achieved a similar feat in 2004 as a constituent of the SLFP-led UPFA coalition under President Chandrika Bandaranaike Kumaratunga; 41 of its 52 candidates who contested the 2004 general election on the UPFA ticket were returned, and it ‘donated’ two of its seats to the SLFP, which was troubled by an internal dispute over the National List slots. Anura Kumara Dissanayake, Wimal Weerawansa and Vijitha Herath topped the preferential vote lists in the Kurunegala, Colombo and Gampaha Districts, respectively, in that election.

Now, the road is clear for President Dissanayake and the NPP, and they will have to deliver what they promised the people, who have long wish lists. They will have to get cracking because 2025 will be an election year; the clock is ticking. They will have to straighten up the economy, grant relief to the public, strengthen the rule of law, eliminate corruption and waste, recover the stolen public funds, solve the unsolved crimes and bring the perpetrators thereof to justice. This no doubt is a tall order, but they have to make good on their promises.

It behoves the winners of electoral contests to bear in mind that their victories do not last forever, and they run the risk of being voted out of office one day unless they live up to the people’s expectations. They should learn from the ouster of President Gotabaya Rajapaksa, who was instrumental in delivering a two-thirds parliamentary majority to the SLPP in 2020. Gotabaya and other SLPP leaders failed because they let power get the better of them and surrounded themselves with some self-proclaimed pundits including university dons. They did not learn from their humiliating electoral defeat in 2015. Their party, the SLPP, which initially had a two-thirds majority in the last Parliament, has been reduced to a mere three seats, as a result.

It may be recalled that following Gotabaya’s impressive win in the 2019 presidential race, thousands of youth embarked on a campaign to re-cultivate abandoned paddy fields and adorned wayside walls with beautiful murals, some of which are still visible. But that government failed to live up to the expectations of those youth, who eventually turned against it, asking Gotabaya and his kith and kin to go home, due to an unprecedented economic crisis. Many of them left the country and others took to the streets, calling for a ‘system change’.

President Dissanayake has said he will not turn back until the country attains its development goals. He has also undertaken to cleanse Parliament as a national priority; thankfully, the ‘Maroon Wave’, which barrelled across the country on Thursday, has already flushed out many political dregs who polluted the legislature for many years. It is hoped that he will succeed in achieving his goals.

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