Unfair touse mysterious formula to jack up fuel prices- JVP


By Saman Indrajith

People of this country were compelled to shell out their money whenever the government jacks up fuel prices according to a pricing formula, which was not known to those consumers, the JVP said yesterday in Parliament.

JVP leader Anura Kumara Dissanayake said that it was unfair to make the public bear the increases fuel prices determined by a secret formula. "We have asked several times in this House to table that mysterious formula. Thereafter we tried to obtain it with the help of the Right to Information Act, but in vain. Even the Finance Minister of the country says he cannot comprehend the formula. We wonder whether the Prime Minister can table that formula or explain it to this House."

Oil price increases were inevitable in the current global context with or without a pricing formula Prime Minister Ranil Wickremesinghe said.

The PM said that he did not have the price formula and that it should be requested from Finance and Mass Media Minister Mangala Samaraweera.

"Whatever the methodology or the price formula is, the impact of the highly volatile global situation will be felt. If the US imposes economic sanctions on Iran in November the global crisis will deepen. The world oil consumption usually increases from November to April because of the winter season. Some even predict that the price of a barrel of crude oil which is now at USD 80 could rise to even USD 90. The other issue is the strengthening of the US dollar. As a result, the currencies of many developing countries have depreciated. As a government we are ready to deal with these twin crises while giving the necessary relief to the people."

Wickremesinghe said that the oil price formula had received the due Cabinet approval. "The new methodology received the Cabinet approval on May 9 and it was introduced from May 11. The Cabinet appointed a committee of officials on July 10 to make necessary revisions to the oil prices as per the price formula," he said.

"India revises the oil prices daily and some countries revise the oil prices weekly. We do not have the technical expertise to make daily adjustment to the oil prices. Hence we do so every month. Until the recent, the oil price revisions were administrative decisions of the government, but in 2015 we proposed to go by the world market prices, and we gave that benefit to the people by reducing the prices. I can only explain the policy decisions. You have to sort out any technical matters with Minister Samaraweera."

 The PM also said that the US-China trade war could also make a significant impact on Sri Lanka. "The world oil market prices are dependent on the demand for oil by these two countries," he remarked.  

The PM, responding to a question by MP Dissanayake on reducing import duty on oil, said it would not help ease the prevailing crisis. "All countries impose tax on oil imports and it is a vital source of income for any government. Removing the tax will not solve the problem we are facing."

 Dissanayake pointed out that Minister Samaraweera did not table the price formula in Parliament despite the repeated requests. He said the Finance and Mass Media Ministry had refused to give out the oil price formula despite an application he filed under the Right to Information Act. "You increase the oil prices on the 10th of each month citing a price formula which nobody is aware of. This is unfair by the consumers."

The Prime Minister replying to UNP MP S.M. Marrikkar said the measures taken by the government to suspend the vehicle permit of state officials as a means of curtailing the imports would have to be continued till the current pressures on the exchange rate eased. The MP urged to continue to offer the vehicle permit to the state officials who were getting it for the first time.

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