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Cabraal sets record straight on the debt burden left behind by Yahapalana regime and JVP claims



By Saman Indrajith

Sri Lanka’s success story of countering the COVID-19 crisis could have been a more effective and advantageous if not for the debilitation of the economy under the yahapalana regime, Parliament was told on Wednesday.

Winding up the debate at the time of the adjournment of the House, State Minister of Money and Capital Markets and State Enterprise Reforms Ajith Nivard Cabraal said that the performance of the previous government had weakened the economy as never before.

 “There is a shortage of reserves and that has resulted in limiting our import options. We would have been able to do much better after overcoming the COVID-19 crisis if there had been enough reserves. The previous government also increased the debt burden. Debts stood at 71 percent of total GDP at the time they came to power. They increased it to 91 percent.

 “We managed somehow. But we could have given more relief to the people. We could have made use of some opportunities on the economic front to boost the small and medium scale enterprises if there had been enough reserves.

 “During our time we recorded a 6.5 per cent growth and an increase of GDP from 24 billion US dollars to 79 billion US dollars. Inflation shot up causing suffering to the people due to the collapse of the economy under the previous government.

 “Now, we are planning to get the national economy back on the track by 2021. You can get an idea of the current situation from the Central Bank 2019 annual report before you understand the challenge before us. We have to rebuild the economy and help the public. It is a big challenge but we are not afraid because we are sure that we can turn the tide; we have the expertise to do. We’ll fast-track the development process. We are introducing some tools to attract foreign direct investments”, Cabraal said. 

 The State Minister said that he would not take the predictions of the Opposition Leader seriously as the latter had a record of making wrong predictions. “I remember that he was shouting in 2007 and 2008 that the economy would collapse any time. That did not happen.”

Responding to JVP leader Anura Kumara Dissanayake’s allegations that the economy had suffered a loss by investing in Greek bonds while he was the Governor of the Central Bank, the Minister said: “That is a topic they keep harping on while the rest of the world has moved ahead. I have explained this in my book ‘The Great Bond Scam’ in detail. There on Page 313 this matter has been dealt with in detail. Then there is a judgment by a three-judge bench of the Supreme Court presided by Chief Justice K Sripavan. It has put all these allegation to rest. The MPs who come here to talk should do their homework. I do not know whether they deliberately hide facts to mislead the public. There is one such example, it was stated in this House today that our decision to invest EPF monies was wrong because we suffered a 3,071- million-rupee loss. The Opposition however did not say that while the loss was standing at that amount for some loss making shares, we had earned a Rs 17,577 million profit. In 2011, the capital profit from EPF investment was at Rs. 2,678 million. In 2012 it increased to Rs. 3,016 million in 2013 and Rs. 3,339 million. In 2014, the profit rose to Rs. 5,544 million. I table a copy of my book because it has answers to some questions the MPs raised though they have passed their shelf life. The matter of a forensic audit has been raised. I have explained that on page 149 of this book.”

Referring to the contribution made by the JVP to the national economy, the state minister read out a list of damages and destruction attributed to the Marxist party during its second insurrection in the period of terror from 1989-90. “They destroyed 684 post offices, 13 telecommunications centers, 550 buses, 75 tea factories, 40 estate bungalows, 130 CEB transformers, 12 trains and six railway stations. The total loss by those actions has been estimated at Rs. 55 billion rupees.”

Cabraal said that while he was the Governor of the Central Bank he had heard of the same allegations being made in the House but he could not respond as an official. “Today, I am a member of this House and I can respond to these wild allegations and inform the House the truth. I thank colleague member Prof Ranjith Bandara for moving this motion for debate,” the minister said.



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PMB declines to release Rs 1.2 bn FD for paddy purchasing



Treasury forced to bear responsibility for Rs 2 bn in loans

By Shamindra Ferdinando

State Finance Minister Ranjith Siyambalapitiya has said that the State Banks weren’t in a position to release funds to the Paddy Marketing Board (PMB) as the enterprise owed them a staggering sum, running to over Rs 20 bn.

Due to the failure on the part of the state enterprise to settle previous loans, the Treasury has been compelled to accept the responsibility for repaying them, the State Minister said.

The Kegalle District lawmaker said so on the live political programme, Salakuna, telecast on Hiru on Monday night. The State Minister was responding to interviewer Chamuditha Samarawickrema’s query regarding the inordinate delay on the part of the government to implement the paddy purchasing scheme.

Referring to Agriculture Minister Mahinda Amaraweera’s abortive efforts to obtain the required funding, lawmaker Siyambalapitiya said that the Treasury was helpless.

State Minister Siyambalapitiya said the PMB couldn’t be faulted for the crisis as successive governments had directed the state enterprise to purchase paddy at a higher price, then ordered it to sell at a much lower price, thereby causing staggering losses.

The State Minister also acknowledged management level shortcomings and political interventions caused the ruination of the PMB.

The PMB owed the Bank of Ceylon and the People’s Bank Rs 1,600 mn and Rs 690 mn, respectively.

The State Minister acknowledged that the issue couldn’t be resolved in spite of interventions made by President Ranil Wickremesinghe and Premier Dinesh Gunawardena. Referring to a subsequent discussion he had with the Secretary to the Treasury Mahinda Siriwardana, lawmaker Siyambalapitiya said that the BOC has asked for Rs 1.2 bn fixed deposit as security though the PMB declined to do so. According to the State Minister the PMB asserted that it couldn’t forgo the fixed deposit as the

interest received was utilized for day to day running of its operations.

The State Minister said that the banks could release the required funding on the basis of a guarantee given by the Treasury. The lawmaker explained the inability on the part of the Treasury to give such a guarantee as further deterioration of public finance could have a devastating impact on the banking sector. Such an eventuality couldn’t be allowed, the SLFPer said.

The Minister acknowledged that the failure on the part of the government to launch a paddy purchasing scheme would dishearten the farmer community.

Chamuditha Samarawickrema pointed out that the private sector had managed their ‘operations’ in a much better way.

The State Minister said that the situation was so bad that of the recent Rs 93 mn public sector salary bill, the government could meet Rs 82 mn. The government had no option but to ask those state enterprises to pay salaries from their funds, pending repayment, the MP said, reiterating the Treasury couldn’t help the PMD at the moment.

Responding to further questions, the State Minister said that the government would definitely give priority to the PMD issue once they finalized public sector salary payments. The Minister urged the media not to pursue an agenda detrimental to the government’s recovery efforts. Asked to explain, the State Minister said that there had been accusations the government didn’t purchase paddy to clear the field for the private sector. The Hiru team pointed out that the banks had released substantial amounts to the private sector to purchase paddy. The Minister explained the banks tried their best to help but circumstances were such the government couldn’t help at the moment.

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PSC proposes amendment to Children and Young Persons Ordinance



A meeting of the Parliamentary Select Committee to ensure gender equality in progress. Among those present were lawmakers Rohini Kaviratne, Sudarshini Fernandopulle, Dr. Seetha Arambepola and Deputy Secretary General of Parliament Kushani Rohanadeera (pic courtesy Parliament)

The Parliamentary Select Committee to ensure gender equality has decided to propose amendments to the Children and Young Persons Ordinance to consider all those below 18 years as children.

The PSC presided by its Chairperson Dr. Sudarshini Fernandopulle that met in the Parliamentary Complex last week also decided to replace the reference ‘young persons’ in the Ordinance and to rename it as the Children’s Ordinance.

As per the amendments every reference to “Children and Young Persons Ordinance”, “children and young persons”, “child or young person” and “age of sixteen years” in any regulation or rule made under the principal enactment or notice, notification, contract, communication or other document issued under the principal enactment shall be read and construed as a reference respectively, to “Children’s Ordinance”, “children”, “child” and “age of eighteen years.

Section 71 of the Ordinance will be amended, by the repeal of subsection (6) of that section establishing that “nothing in this section shall be construed to affect the right of any parent, teacher or legal guardian to punish a child or youth”.

The purpose of the Children and Young Persons Ordinance Clause 23 is to make orders for the establishment of Juvenile Courts for the supervision of juvenile offenders for the protection of children and young persons.

State Minister Dr. Seetha Arambepola, Members of Parliament Thalatha Atukorala, Rohini Kaviratne, Eran Wickramaratne, Dr. Harini Amarasuriya, Manjula Dissanayake, Secretary to the Committee and Deputy Secretary General of Parliament Kushani Rohanadeera and senior officials representing the Ministry of Women and Child Affairs and the Ministry of Justice, Prison Affairs and Constitutional Reforms were present at the PSC meeting.

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80 houses destroyed in fire at Thotalanga



The scene of the fire(pic by Jude Denzil Pathiraja)

At least 80 houses were destroyed due to a fire that broke out in a highly congested area in Colombo on Tuesday (27) night. Around 220 people had been displaced, the police said.

The fire broke out at Kajeemawatte in Thotalanga at around 8 pm on Tuesday and it took firefighters several hours to bring the fire under control. Twelve fire engines were deployed, but many of the dwellings had been burnt out as approach roads were not wide enough for the vehicles to reach the fire.

Those who are affected are now housed in community centres and places of worship.

No casualties were reported in the incident. The police are yet to determine the cause of fire and the total damage to property has not been estimated still.

Meanwhile, President Ranil Wickremesinghe, who is on an official visit to Japan, has instructed Presidential Secretary Saman Ekanayake to take steps to provide immediate relief to all victims of the fire.

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