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The abolition of the Senate

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Dr Nihal Jayawickrama

It was fifty years ago, on October 2, 1971, that the Governor-General, William Gopallawa, assented to the Bill that sought to abolish the Senate, the upper chamber of the Parliament of Ceylon. It was an event that was precipitated by the Senators themselves.

The Senate was one of the five constitutional safeguards that were included in the 1946 Constitution in order to remove the fear of “domination and oppression” by a “permanent and unassailable majority” which existed especially in the minds of Ceylon’s ethnic and religious minorities. The other entrenched safeguards were multi-member constituencies in those electorates in which a substantial minority, whether racial, religious or otherwise, lived; six nominated members of the House of Representatives to represent interests which were either not represented or were inadequately represented; an independent Public Service Commission which would guarantee strict impartiality in all matters affecting appointments; and a prohibition on Parliament enacting legislation either to confer a privilege or to impose a disability on persons of any particular community or religion.

Forum for impeding precipitate legislation

The Senate, with 15 members elected by the House of Representatives (according to the principle of proportional representation) and 15 members nominated by the Governor-General, was intended to serve as an instrument for impeding precipitate legislation as well as a forum for handling inflammatory issues in a cooler atmosphere. It was hoped that the Senators, being eminent individuals of high intellectual attainment and wide experience of national and global affairs, would make a valuable contribution to the law-making process. The Constitution required that not less than two Ministers (one of whom was the Minister of Justice), and not more than two Parliamentary Secretaries should be members of the Senate. The first Minister of Justice was Sir Lalita Rajapakse, QC., LLD. His successors were equally eminent men of the law. They included E.B.Wikramanayake QC; M.W.H. de Silva QC, former Attorney-General and Judge of the Supreme Court; Valentine S. Jayawickrama, former District Judge and Commissioner of Assize; and G.C.T.A. de Silva former District Judge and Permanent Secretary to the Ministry of Justice.

In the 24 years of its existence, the Senate enabled proposed legislation as well as governance issues to be debated by a small group of men and women who had reached the pinnacle of their respective professions and other fields of endeavour. This group of distinguished Ceylonese included experienced civil servants (C.Cooomaraswamy, H.E.Jansz, R.S.V. Poulier, Sir Kanthiah Vaithianathan, Sir Oliver Goonetilleke); entrepreneurs (Sir Chittampalam Gardiner, Sir Cyril de Zoysa, Justin Kotelawela, Sir Donatus Victoria, K.Adamally, Sir Mohamed Macan Markar), proprietary planters (Thomas Amarasuriya, C.Wijesinghe, Layard Jayasundera) eminent lawyers (S.Nadesan QC, M.Tiruchelam QC); men of medicine (Sir Nicolas Attygalle, Dr. M.V.P.Peries, Sir Frank Gunasekera); scholars and educationists (S.Natesan, A.M.A.Azeez, Doric d’Souza, A.B.Rajendra); social activists (Cissy Cooray, Evelyn de Soysa, Evadne de Silva); and economists (N.U.Jayawardena) They were complemented by political representatives who included Dr.E.M.V.Naganathan (TC), Reggie Perera, Chandra Gunasekera (LSSP), Peri Sunderam (CIC), L.B.Jayasena (CP). I recall the numerous occasions in the early 1960s, during the period when my father-in-law-to-be was President of the Senate that I used to proceed from Hulftsdorp to Fort, to sit in the Senate gallery and absorb the sharp analytical wisdom of these eminent men and women. I also recall that an emerging relatively young politician who was frequently also in the visitors’ gallery was R.Premadasa together with his fiancee. It must be recalled that it was the Senate that enabled the world’s first woman Prime Minister to assume that office after not having contested any seat in the July 1960 general election.

Saving Nanda Ellawela

In July 1970, following the general election held in May of that year, the Minister of Constitutional Affairs, Dr Colvin R.de Silva, introduced a Bill to amend section 13 of the Ceylon (Constitution) Order-in-Council. That section provided that a person who had served three months’ imprisonment for an offence punishable with imprisonment for a term exceeding one year was disqualified from sitting in either House of Parliament. The amendment sought to define a disqualifying offence as one involving “moral turpitude”. Dr.de Silva stated that the Bill had been drafted in the Ministry of Justice, and not by his Ministry. It had probably been drafted before I assumed office as Permanent Secretary in mid-June, since I became aware of it only when it was presented in the House of Representatives. It may even have been drafted by private lawyers before the general election. The Bill sought to make the amendment retroactive from 25th March 1970. It was an open secret that the purpose of this rushed legislation was to enable Nanda Ellawela, the newly elected MP for Ratnapura, to retain his seat. He had been convicted of unlawful assembly and had served a sentence of imprisonment above the disqualifying period. Predictably, an election petition had been filed and it was due to be taken up for hearing very shortly.

In the House of Representatives, the UNP and the Federal Party opposed making the amendment retroactive, but the former kept away, and the latter abstained when the vote was taken, thereby enabling the Bill to be passed with the required two-third majority. W.Dahanayake of the UNP resigned from the party, explaining that he disagreed with his party’s opposition to the amendment since the UNP had in previous years introduced similar legislation to enable E.L.Senanayake and A.L.Thambiyah to retain their seats in Parliament..

What is “moral turpitude”?

When the Minister of Justice, J.M.Jayamanne, presented the Bill in the Senate on August 6, having suspended standing orders in order to have it passed through all three stages before the end of day, it immediately ran into serious problems. Senators K.M.P. Rajaratne, S.Nadesan QC, and M.Tiruchelvam QC, in a brilliant analysis of the Bill pointed out that while “moral turpitude” had been defined to include offences such as theft and robbery, other serious offences including rape and kidnapping were not. “Would not bigamy constitute “moral turpitude” they asked ? Several members in that UNP controlled Senate appealed to the visibly rattled Minister to amend the Bill either by defining “moral turpitude” more broadly, or to remove altogether the disqualification of a person who had completed serving a sentence of imprisonment. With the Minister refusing to adopt either option, the Leader of the Senate, A.P. Jayasuriya, proposed that the debate be adjourned for the next day.

Two “obstinate Senators”

On the following morning, I was in my office in the Ministry of Justice (I was at that time also acting as Permanent Secretary in the Ministry of Health) when I received a telephone call from Mr. J.R.Jayewardene. He said that he had done all he could to persuade UNP Senators to either abstain or keep away at voting time as had been done in the House of Representatives, but that Senator Fairlie Wijemanne, Leader of the Opposition, was determined to defeat the Bill. He said that with an obstinate Justice Minister and an equally obstinate Opposition Leader, he did not need to remind me what the consequences of that would be. He obviously anticipated that the Government’s next move would be to abolish the Senate.

He asked me to go to the Senate and do whatever I could to avoid that calamity. I did so and found that Ministers Felix Dias Bandaranaike and Colvin R.de Silva were both in the Senate Restaurant too. The government was not willing to accept either of the amendments suggested by Senators Nadesan and Tiruchelvam. The resumed debate therefore ended with the Bill being rejected by 13 to 7. Nine UNP Senators were not in the chamber when the vote was taken. The rejection of the Bill meant that the Government would not be able to secure the necessary constitutional amendment before the Ratnapura election petition was taken up for trial.

Lobby correspondent Manik de Silva described the debate as “one of the most exciting discussions in the teak-and-satin panelled chamber of the Upper House within recent memory”.

On the following morning, the Daily Mirror editorial had this to say:

By virtue of its vigil over this Bill, the Senate has rocketed in public esteem. It has manifested its utility as the Soulbury Commission envisaged “to prevent hasty and ill-considered legislation reaching the Statute Book”, and as the Commission also hoped it has used the delay “for the purpose of giving time for reflection and consideration” of the flaws in the Bill.

Responding to the vote in the Senate, Minister Felix R.Dias Bandaranaike explained that the Government had three options. The first was to prorogue Parliament for a day and present the Bill again in the House of Representatives in the new session. That, he thought, might create an unhealthy precedent. The second was to delay the hearing of the Ratnapura election petition. The third was to pardon Mr.Ellawela to enable him to contest his seat again.

On August 13, when the Ratnapura election petition against Nanda Ellawela was taken up for hearing before Justice O.L.de Kretser, the proctor for the petitioner informed Court that he had no instructions to proceed with the trial. Counsel for the respondent moved that the petition be dismissed, but the Judge, probably suspecting collusion, stated that he wished to hear the petitioner in person before doing so. Accordingly, he re-fixed the hearing for August 30. On the same day, the Cabinet decided to introduce legislation to abolish the Senate.

Bill to abolish the Senate

On October 28, 1970, the House of Representatives passed, with 117 for and 16 against, the Bill to abolish the Senate. On the previous day, the election of Nanda Ellawela to the Ratnapura seat was declared null and void by the Election Judge, Justice O.L.de Kretser on the ground that he was disqualified for election in view of his conviction and sentence of imprisonment. On November 9. 1970, the Minister of Justice, Senator Jayamanne, moved the second reading of the Bill to abolish the Senate, but was thwarted when he moved that government business have precedence on the day’s proceedings. Four months later, on March 24. 1971, Parliament was prorogued, and the next session was opened by the Governor-General on March 28, 1971. Immediately thereafter, the House of Representatives again passed the Bill for the abolition of the Senate.

The Constitution provided that if a Bill is passed by the House of Representatives in two successive sessions, and having been sent to the Senate in the second of those sessions, is not passed by the Senate within six months after the commencement of that session, the Bill may, notwithstanding that it has not been passed by the Senate, be presented to the Governor-General for his assent. On 23rd September 1971, the Senate convened for its final meeting. On October 2, 1971, the Governor-General assented to the Bill and the Ceylon (Constitution and Independence) Amendment Act No.36 of 1971 came into force, converting Ceylon’s bicameral legislature into a unicameral one.

The Constitution provided that a Minister who for any period of four consecutive months is not a member of either Chamber shall, at the expiration of that period, cease to be a Minister. However, on January 20, 1972, at the request of the Prime Minister, the Minister of Justice, former Senator J.M.Jayamanne, tendered his resignation and was succeeded by Felix R.Dias Bandaranaike, Member of Parliament for Dompe, who was already Minister of Public Administration, Home Affairs and Local Government. On February 3, 1972, on the eve of the expiry of the four month period, John Rodrigo, an appointed member of the House of Representatives tendered his resignation and was appointed Ambassador to Italy. On the following day, former Senator C. Kumarasuriar, Minister of Posts and Telecommunication, was nominated to fill the vacancy thereby created.



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The NPP’s pivot to the past

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“The elephant is crashing about in the room, trampling people to death, and politely ignoring it is no longer an option”.

AC Grayling (To Set Prometheus Free)

Before Anura Kumara Dissanayake promised a renaissance, Maithripala Sirisena promised good governance. The restoration of the rule of law was a key aspect of the different, better Sri Lanka Candidate Sirisena (and his chief supporter Ranil Wickremesinghe) offered in 2015. In that promised land, all wrongdoers will be brought before the law; justice will cease being a luxury only the rich and the powerful can afford and become a fact of ordinary life.

Chandrika Bandaranaike Kumaratunga’s elevation of the singularly unsuitable Sarath Silva to the august position of chief justice (an appointment some sought to justify on the irrelevant grounds that he was a Buddhist) had severely undermined judicial independence. Mahinda Rajapaksa dispensed with the rule of law entirely, enshrining in its stead the law of the ruling family. The illegal (and thuggish) impeachment of chief justice Shirani Bandaranayake destroyed even the pretence of judicial independence.

Today, Namal Rajapaksa is a born-again advocate of judicial independence and the rule of law. He seems to not remember the measure of the man his father and family picked as chief justice once they booted out Shirani Bandaranayake. Just one example would suffice to demonstrate Mohan Peiris’ suitability to be enthroned as the Rajapaksa chief justice. In November 2011, responding to a question about the disappearance of Prageeth Ekneligoda, Mr Peiris told the UN Committee against Torture, “Our current information is that Mr. Ekneligoda has taken refuge in a foreign country… It is something we can be reasonably certain of” (BBC– 25.11.2011). When summoned before the Homagama magistrate court (where the Ekneligoda case was being heard), he did a volte face. He rejected “the transcript of the statement he made in Geneva last year,” and said “he could not remember the source that revealed to him the whereabouts of Prageeth Ekneligoda,” adding that “I have no information that the corpus is alive or not and I do not think the government does either and that God only knows where Ekneligoda is” (Ceylon Today – 6.6.2012).

With Mohan Peiris controlling the judiciary, the law of the Rajapaksas could stalk the land unimpeded. For many voters who flocked to Maithripala Sirisena’s side in 2015, restoring the rule of law was not an abstract slogan but a vital necessity.

The Sirisena-Wickremesinghe administration did not betray that promise. Restoring judicial independence was the best – and the most enduring – achievement of an administration which violated the bulk of its promises and betrayed a large part of its mandate.

Unlike Maithripala Sirisena, Anura Kumara Dissanayake did not inherit a debased and a cowed judiciary. He inherited a strong judiciary confident enough to take on an executive president, a judiciary unafraid to stand up to a saffron mob and put a stop to the misuse of the International Covenant on Civil and Political Rights (ICCPR) as a blasphemy law. Today, the judiciary remains one of the very few relatively undebased and uncompromised (plus popular) institutions in the country. Consequently, President Dissanayake’s task does not involve any doing. His task is to refrain from doing. His May Day remark concerning an upcoming verdict is an example of what he should not to.

While the judiciary has been a beacon of hope in dark times (despite occasional backsliding), the same cannot be said of the police, an essential component in maintaining the rule of law. If the police fail to carry out investigations impartially and speedily, if they favour powerful suspects over powerless victims, then the rule of law is violated at the foundational level, a wrong that cannot be righted even by the most independent judiciary.

Is the saffron robe above the law?

Addressing a District Development Committee meeting last week, President Dissanayake said that his government has ended the impunity of those who believed that the law would never apply to them.

Does the president live in a parallel universe where a powerful monk accused of raping a 12-year-old child is being protected by a non-divine hand?

The crime is so horrendous it would have sufficed to cause the most powerful politician or the wealthiest businessman to fall from grace. Despite the necessary presumption of innocence, any political or economic leader accused of ‘purchasing’ a small child from her parents and raping her would have been arrested immediately, kicked out from whatever positions he occupied, and ostracized societally. If the government was dragging its foot, if the police were bending the law, the opposition and the media would have been on them like a tonne of bricks. If the accused had any connection with the opposition, the government would talk of little else for days. There would be parliamentary debates and press conferences, media exposes and public protests.

Not when the accused is Pallegama Hemaratana thera, the head of Atamasthana. Then the only sound from the usually garrulous political, economic, and religious leaders is silence.

Human Rights Council and Euro-Med Human Rights Monitor have published extensive reports of how Israel systematically uses sexual violence against Palestinians ( and ). Last week, The New York Times carried its own expose detailing these atrocities. In his commentary on the findings, Nicholas Kristoff, a two-time Pulitzer winning journalist, wrote, “It’s a simple proposition: Whatever our views of the Middle East conflict, we should be able to unite in condemning rape” ().

Indeed. Similarly, we should be able to unite in condemning child abuse, whatever the identity of the alleged perpetrator. But when it comes to the Pallegama Hemaratana case, government and opposition, religious and economic leaders, most of the media and societal luminaries have united in wilful blindness and wilful deafness. Had it not been for judicial action and the effort made by the National Child Protection Authority, the monk would still be lording it over in Atamasthana. Even after the court ordered his arrest, he managed to evade prison and spend days in the Nawaloka hospital.

The Minister of Children and Women’s Affairs issued an anodyne statement after the judicial order rendered police inaction impossible. Nothing, though, from the president, the many would-be presidents, the PM, the leader of opposition, party leaders. Nothing also from the Mahanayake theros or the Cardinal. Just announce that children will be taught how to identify and protect themselves from child abusers and mark how quickly the silence ends and the cacophony of outrage begins.

In his autobiography We don’t know ourselves – A personal history of modern Ireland, Irish author Fintan O’Toole writes of a priest-teacher who abused his students, “openly, constantly, shamelessly…” The perpetrator picked his victims carefully, “the vulnerable boy, the kid who got into trouble, the kid whose father had died.” Mr O’Toole calls clerical child-abuse “…the open secret, the thing that everybody knew and nobody grasped, the truth that could be seen but never identified. We were adepts at epistemology. Most of us could walk like circus performers across tightropes that were strung between private knowledge and public acknowledgement. The only ones who ever looked down were those who were badly abused, and they became even better at suppressing reality.” For decades, individual acts of resistance went nowhere. A friend calls out the abusive priest-teacher in class. The priest ignores him and tells the class to turn to another page in the Latin grammar, which they do. “David was defeated. He just sat down again and everything went on as if his accusations had never been voiced.”

In Sri Lanka too, clerical child-abuse is obfuscated by a ‘cloud of unknowing’. Occasionally, the cloud lifts, when the victim has parents who care, who are able to protest and protect. This week, the Appeal Court confirmed the seven-year sentence passed on Hambegamuwe Chandananda by the High Court for abusing a nine-year old novice monk the day after he was ordained. If we ignore or tolerate such horrors in the name of Sasana, then we cannot be adherents of The Buddha.

Like any suspect, the monk Pallegama Hemaratana is innocent until and unless proven guilty by a court of law. But for him to be proven innocent (or guilty), there has to be a proper investigation and a speedy trial. How can there be any hope of a fair and a transparent investigation and a speedy trial given how hard various authorities tried first to keep the story under the wraps, then not to arrest the monk, and finally to keep him in the Nawaloka Hospital?

Given the range and magnitude of this preferential treatment, the involvement of the political authority up to and including the president cannot be ruled out. The Opposition’s complicity in this matter has given the government-enabled impunity wings. Suddenly, it’s as if the Rajapaksas never left.

The first step down the abyss

In his 1968 article The Territories, Israeli philosopher Yeshayahu Leibowitz issued a warning to his own countrymen and women. “Rule over the occupied territories could have social repercussions… The corruption characteristic of every colonial regime would also prevail in the state of Israel.” In his 1988 essay 40 years after, he returned to the theme. “That a subjugated people would fight for its freedom against the conquering ruler, with all the means at its disposal, without being squeamish about their legitimacy, was only to be expected. This has been true of wars of liberation of all peoples… We are creating – and have already created – a political atmosphere affecting the public as well as its individual members… In this same atmosphere one hears of cases of soldiers attempting to bury Arab boys alive; the Attorney General tries to distinguish between torture and ‘reasonable’ torture; those in charge of the army distinguish ‘burial alive’ from the burying alive of bodies without interring the heads.”

Consider the end. Resist the beginnings. In Sri Lanka, warnings about the danger of clerical impunity were made as far back as the 1930’s when the country was still Ceylon. One such Cassandra-figure who foresaw the future, whose words went unheeded was Munidasa Kumaratunga. In his 2 October 1934 editorial in Lakmini Pahana, he wrote, “If a monk engages in wrongdoing, we should not close our eyes. Instead, we should ensure that the monk is given the punishment appropriate for his wrongdoing.” Ignoring that sage warning, we developed into a fine art the devise of worshipping the robe irrespective of the quality of the wearer.

The police while treating an alleged child-rapist with kid gloves publicly arrested a monk in Rajanganaya for insulting a minister and two top cops. That differential treatment points to two dangerous developments which, if not nipped in the bud, can take us right back to the Rajapaksa days. One is the reincarnation of impunity. The other is the politicisation of the police.

The undermining of the police at the institutional level reached its zenith under Rajapaksa rule. Two examples from the South and the North would suffice to show the consequences of this debasement.

In July 2009, a coordinating secretary of the Minister of Human Rights, Mahinda Samarasinghe was abducted. The minister eventually uncovered that the victim had not been abducted by criminals (as was supposed initially) but ‘arrested’ by the police. He protested saying that the “police cannot simply barge into people’s houses without appropriate documents and take people away” (Bottom Line – 5.8.2009). The police’s response was, yes we can; the abduction was the work of a ‘special squad that had wide powers to arrest anybody in any part of the country” (The Island – 7.8.2009).

On 20 September 2011, Antony Nithyaraja, a man wanted by the police, appeared before the Jaffna magistrate through his lawyer. “The Magistrate after considering the police submissions and court documents released him. However, seven police officers in civilian clothes arrested him and started beating Antony in the presence of the Magistrate, lawyers, court staff and a large number of people. He was dragged to the Jaffna Headquarters Police Station for detention” (Asian Human Rights Commission – 23.9.2011).

The police could take the law into their own hands because the rulers created an enabling environment for such illegalities. The rot was begun by politicians, and can only be ended by politicians. Reforming the police was a key promise of Maithripala Sirisena in 2015 and Anura Kumara Dissanayake in 2024. Mr Sirisena broke it. Mr Dissanayake is breaking it. The carcinogen has returned to the body.

by Tisaranee Gunasekara ✍️

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Cinnamon Tea Stick project aims to reprice Lanka’s tea economy 

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On a humid tea-growing slope in Sri Lanka’s south-western highlands, where mist drifts over the edges of the Sinharaja Forest Reserve, a quiet experiment is attempting to reimagine one of the country’s most enduring export lifelines.

For generations, tea has been both livelihood and legacy for thousands of smallholders across Sri Lanka. Yet beneath the global reputation of Ceylon Tea lies a persistent grievance. Growers say their earnings have remained largely stagnant even as value-added tea products fetch premium prices in overseas markets.

It is against this backdrop that entrepreneur Sarathchandra Ramanayake is promoting a new product he believes could shift more value back to the farmer. The product is called the Cinnamon Green Tea Stick, designed as a portable, bag-free infusion format aimed at premium and health-conscious consumers.

Sarathchandra Ramanayake

World Tea Day, observed on the 21st of this month, adds context to a wider debate about who benefits most from the global tea economy, the planter or the processor.

Ramanayake’s proposal is ambitious. He argues that while tea leaves currently fetch modest farm-gate prices, a redesigned value chain built around specialty processing could generate significantly higher returns. In his model, a kilo of finished product could translate into substantially improved earnings for growers, particularly through export-oriented niche markets.

He said the aim is to move away from bulk commodity pricing and toward value-driven tea consumption. The concept replaces conventional tea bags with a solid stick format infused with cinnamon, sourced from Sri Lanka’s spice-growing regions.

The Kalawana area in the Ratnapura District, where small tea holdings dominate the agricultural landscape, has been identified as a potential production base. In these communities, tea remains the backbone of rural livelihoods and sustains entire families.

Ramanayake said the initiative is not intended to replace traditional supply chains but to complement them. Farmers would continue supplying factories while also contributing selected high-quality leaves for the new production process.

Regulatory approval has been obtained under handmade tea production guidelines from the Tea Board, and a patent application has been submitted under intellectual property provisions.

Early signs of commercial interest are emerging. According to Ramanayake, small export orders have already been received from markets including the United Kingdom, suggesting tentative international interest in the product’s positioning.

The project also highlights long-standing structural issues within Sri Lanka’s tea economy, where value addition, branding and export margins are often concentrated far away from the farmer who produces the leaf.

Ramanayake’s pitch is both economic and social. By incorporating cinnamon, another of Sri Lanka’s globally recognised agricultural exports, the product also seeks to strengthen rural spice growers and diversify farm-level income.

Still, questions remain over whether such boutique innovations can meaningfully shift earnings at scale in an industry shaped by established auction systems and large processors.

For now, the Cinnamon Green Tea Stick sits at the intersection of tradition and innovation, carrying an ambition to reprice the leaf, reframe the farmer’s role and reimagine Sri Lanka’s iconic tea industry for a changing global market.

Text and Pix By Upendra Priyankara Jathungama ✍️

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Admitting a New Investor – Lessons from Dankotuwa – Episode 5

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LESSONS FROM MY CAREER: SYNTHESISING MANAGEMENT THEORY WITH PRACTICE – PART 37

In today’s episode, I will relate several incidents from my final years at Dankotuwa Porcelain and the lessons I learned from them. Looking back now, I realise that these years taught me not only about management, finance, labour relations, and corporate survival, but also about human emotions, loyalty, fear, stubbornness, and resilience. They also marked the gradual end of a very long line of executive appointments that had consumed most of my adult life.

The contract labour issue

Because of the uncertainty of export demand, we had adopted a flexible system of recruiting some employees on fixed-term contracts or through labour suppliers. However, unlike many organisations, we took great care to ensure that these employees were not treated as second-class workers. In practice, they enjoyed almost all the benefits of permanent employees. If they served beyond a stipulated period, they were entitled to gratuity as well. We also had to comply with stringent labour and ethical compliance standards imposed by our foreign buyers, many of whom conducted regular audits.

A group of these employees had completed their two-year fixed-term contracts. Due to the uncertain external environment and fluctuating orders, we were unable to offer permanency. Instead, we offered another fixed-term contract for two years.

To our surprise, all of them refused and wanted permanent jobs which were too risky to offer in a volatile environment.

Despite repeated discussions and assurances from the Head of Human Resources, they insisted on nothing short of permanency. They would not budge. Finally, and very reluctantly, I instructed security not to permit them into the premises from the following day, because technically their contracts had expired.

The next morning, the entire group gathered outside the gate. They remained there until around ten o’clock before dispersing. Later, I heard that they were gathering at the residence of a Member of Parliament who lived nearby. This continued for several days.

The MP telephoned me repeatedly and urged me to make them permanent. I refused. The company simply could not absorb that level of rigidity at such an uncertain time. Then matters took an ugly turn.

One morning, some members of the group harassed the Chief Operating Officer while he was entering the premises. They sat on the bonnet of his car and forcibly opened the door. Security identified the main culprits immediately. I made up my mind that, regardless of future developments, those directly involved in intimidation and misconduct would never be taken back.

After nearly a month, the MP contacted me again. He said the matter had become a stalemate and that the group was now willing to accept the original contract terms. I replied immediately: “We now have only one-year contracts available. Anyone interested may report for work.” Some accepted. Others stubbornly refused.

Later, a few of those who had not been re-employed met me privately. They admitted they had been inexperienced young men and women who had merely followed the advice of union leaders. They confessed that it was the unions that had encouraged them to reject the original offer and even urged them to obstruct the COO’s vehicle. They pleaded with me to show mercy, saying they had been misled.

I genuinely felt sorry for them. But I stood firm.

Management sometimes requires compassion, but it also requires consistency. If discipline collapses, organisations collapse soon after.

The incident reinforced one of the most important lessons I learned in labour relations: leaders must distinguish between firmness and cruelty. A manager who constantly bends under pressure may temporarily avoid conflict, but in the long run loses credibility and control.

Thoughts of Retirement

By this time, I was just past 60 years of age. The stress of corporate life had begun taking a visible toll on my health. I often recalled my earlier days at the Employees’ Trust Fund under President Ranasinghe Premadasa, when relentless pressure had caused severe gastritis and ulcers. I still remember how those symptoms vanished within days of leaving the ETF.

I began dreaming of retirement, peace, and perhaps a quieter life devoted to agriculture, which had always fascinated me. But the Japanese directors would hear none of it.

They told me that in Japan, life begins at sixty. They pointed out that many Chairmen—Kaicho, as they are called in Japan—continue well into their seventies. One of the local directors was even sent to meet me personally and persuade me to abandon thoughts of retirement.

So I remained. The COLA problem

One of our biggest internal challenges was the Cost of Living Allowance (COLA) system that had been introduced years earlier. During periods of high inflation, it spiralled out of control. In some months, increases amounted to nearly one thousand rupees—a very substantial figure at that time.

No other industry was granting such increases monthly.

The situation became unsustainable. Worse still, the COLA had been incorporated into calculations for overtime, provident fund contributions, and other benefits. The compounding effect was enormous. We were unable to correct this mistake at the current time.

After prolonged discussions with the unions, we finally managed to restructure the arrangement. The frozen COLA and increases were consolidated into the basic salary structure.

I regarded this as a major breakthrough.

The Labour Department admitted privately that mistakes had been made by the company when the scheme was originally designed, but said nothing could legally be altered retrospectively.

This episode taught me another important lesson: poorly designed compensation systems can haunt organisations for decades. A Board and Chairman must examine compensation schemes very carefully before implementation. A benefit introduced during prosperous times may become a crushing burden during difficult periods.

The search for a new investor

The Japanese shareholders eventually made it clear that they were unwilling to invest further funds into the company. A new investor had to be found if the company was to survive.

Once again, my retirement plans were postponed. The Board insisted that I remain until a suitable investor was secured.

One prospective investor came close to finalising a deal but withdrew suddenly due to uncertainty surrounding the GSP+ concession. Another investor emerged later, but with very strict conditions. One of their key demands was a freeze on salaries and allowances for three years. Negotiations with the unions dragged on for days and weeks. At times, it appeared we were on the verge of success. Then suddenly the unions would withdraw cooperation.

Meanwhile, our financial position was deteriorating rapidly. The Head of Finance confirmed in writing that we could no longer meet obligations as they fell due.

I realised we had reached a dangerous legal and ethical point.

Under the Companies Act, if directors continue operating while knowing the company is insolvent, they may become personally liable for further erosion of assets. This was no longer merely a corporate issue—it threatened my own personal assets accumulated over a lifetime.

I informed the Board that we had no option but to seriously consider winding up the company. The local directors agreed. The Japanese directors requested one week to obtain instructions from Tokyo.

Because of Stock Exchange requirements, we made a disclosure to the Colombo Stock Exchange regarding the possible winding up.

That announcement changed everything.

Copies were displayed throughout the factory and office. Over the weekend, I was inundated with telephone calls from employees.

Some pleaded emotionally with me to save the company. Many had spent their entire working lives there and felt deeply attached to the factory. One group telephoned to say they were conducting a Bodhi pooja at a temple for the company’s survival. Another group called from a church where special prayers were being offered.

Those calls affected me deeply. To all of them, however, I gave the same answer:

“The future of the company is in your hands. If the investor’s conditions are accepted, the company can survive.”

The Minister’s intervention

On Sunday, I received a call from Minister Anura Priyadarshana Yapa asking me to come to his residence immediately.

I went with the COO and found that he had also summoned the General Manager of Noritake Porcelain, whom he knew personally. After hearing my explanation, the Minister called for the union representatives as well.

We waited several hours for them to arrive. During that waiting period, the Minister spoke candidly about politics, privatisation, nationalisation, and the mistakes successive governments had made. It was an unexpectedly educational afternoon.

When the unions finally arrived, the Minister was direct and blunt.

He told them that many workers came from his electorate and that if the factory closed, they should not expect him to find employment for them elsewhere.

The mood changed.

After lengthy discussion, the unions agreed in principle, though they requested a small amendment to the proposed terms. The Minister supported their request.

I said I could not promise anything but would speak to the investor. Fortunately, after difficult negotiations, the investor agreed.

On Tuesday, we met at the Labour Department and signed the settlement. We then informed the stock exchange that an agreement had been successfully reached.

The sense of relief was immense.

The SEC hearing

Even after securing the investor, another obstacle remained. Since the investment involved a fresh issue of shares, approval from the Securities and Exchange Commission of Sri Lanka was required.

That process became another nightmare.

The agreed share price had been based on the prevailing market price, but speculation had driven the market upward rapidly. During the hearing, I faced intense questioning regarding the pricing.

I explained that we could not ethically change the agreed terms after giving our word. More importantly, I stressed that this was the only serious investor available. Losing them could doom the company.

I made a detailed presentation supported by charts and figures. I also spoke frankly.

I admitted that I was suffering sleepless nights worrying about the company’s future.

After the hearing, I stepped outside exhausted and had barely begun packing my laptop when I was summoned back in.

As I entered, the Chairman smiled and said: “Mr. Wijesinha, you can sleep tonight. We have approved your proposal.”

And indeed, that night, I slept peacefully.

Retirement at last

The new investors eventually assumed control. Initially there were difficulties because they came from strong financial and investment backgrounds and required time to understand manufacturing operations and export markets. I personally introduced them to foreign buyers to help them understand the realities of the industry.

The Japanese shareholders became minority stakeholders.

At last, I felt the time had truly come to retire. The new investors requested that I remain for another year to help stabilise the transition. I agreed.

Finally, on June 30, 2012, I retired with mixed feelings.

I had enjoyed the challenges enormously, but they had undeniably affected my health. Yet the experiences proved invaluable later when I served on many Boards. I realised that Dankotuwa had excellent systems, disciplined processes, and an outstanding product. The difficulty was not inefficiency. It was surviving intense global competition in a highly unforgiving industry.

Looking back now, I realise that management theories often sound neat and logical in classrooms and seminars. Real life is rarely so tidy. In practice, leadership involves balancing compassion with discipline, ethics with survival, and long-term strategy with short-term crises.

Perhaps the greatest lesson I learned at Dankotuwa was this: organisations are not saved by systems alone. They are saved by people—their sacrifices, emotions, loyalty, courage, and sometimes even their prayers.

More lessons from my Board experiences will follow in future episodes.

(Sunil G. Wijesinha is a Consultant on Productivity and Japanese Management Techniques

Former Chairman / Director of several listed and unlisted companies

Recipient of the APO Regional Award for Promoting Productivity in the Asia-Pacific Region

Recipient of the Order of the Rising Sun, Gold and Silver Rays – Government of Japan

Email: bizex.seminarsandconsulting@gmail.com)

By Sunil G. Wijesinha ✍️

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