News
Economic crisis: MR, ministers, CBSL Governor, Dr.PBJ ignored IMF warnings
Dr. Jayamaha says Monetary Board acted regardless of strong opposition
By Shamindra Ferdinando
It was disclosed before the Committee on Public Enterprises (COPE) yesterday (25), the then Prime Minister Mahinda Rajapaksa, who served as the Finance Minister, had been briefed, in March-April 2020, on the impending financial crisis of unprecedented magnitude, but he had chosen to ignore the dire warning.
The parliamentary watchdog was told how the International Monetary Fund (IMF) had warned the then Governor of the Central Bank, Prof. W. D. Lakshman, and Treasury Secretary S. R. Attygalle, of Sri Lanka’s inability to procure loans unless the country undertook debt restructuring immediately.
COPE members received a briefing on the circumstances leading to the crisis when senior officials of the Central Bank appeared before the all-party body yesterday. CBSL Governor Dr. Nandalal has stated that the IMF warning hadn’t been heeded at all.
The COPE received confirmation of what has been widely speculated hours after UNP Leader Prime Minister Ranil Wickremesinghe, was sworn in as the new Finance Minister.
Janakantha Silva, Director Legislative Services / Director Communication, Parliament quoted Dr. Weerasinghe as having told COPE that following technical talks held in terms of the Finance Act pertaining to the IMF’s stand, recommendations were made to the then Premier and other senior officials. Dr. Weerasinghe has stated that the relevant decisions should have been made by the Premier, in his capacity as the Finance Minister and the entire Cabinet of Ministers.
The IMF has made its position clear after having asserted Sri Lanka lacked debt sustainability.
Asserting the failure on the part of those who managed the economy for causing a massive crisis, COPE Chairman Prof. Charitha Herath called it a crime. The first time entrant to Parliament recommended the setting up of a Special Parliamentary Select Committee to probe those who neglected their responsibilities thereby caused the current debilitating crisis. Prof. Herath blamed those few who managed the economy during that period.
SLPP National List MP Basil Rajapaksa succeeded Mahinda Rajapaksa in July 2021 as the Finance Minister whereas President Gotabaya Rajapaksa brought in SLPP National List MP Ajith Nivard Cabraal as the Governor of the Central Bank in Sept 2021. Cabraal quit in March to pave the way for Dr. Weerasinghe, the former Bank Deputy Governor to return from retirement in Australia, as its new Governor.
Dr. Harsha de Silva pointed out that the then Finance Minister Mahinda Rajapaksa delegated his responsibilities to the then State Finance Minister Cabraal who refrained from briefing the Parliament as regards the actual situation. Dr. de Silva said that the IMF’s declaration of debt sustainability should be examined against the backdrop of the revenue cut imposed on the recommendation of the then Secretary to the President and one time Central Banker and Treasury Secretary Dr. P.B. Jayasundera that deprived the Treasury of Rs 600 mn in taxes.
Dr. de Silva asked who decided on the tax cut in spite of the IMF specifically advising the government not to do so. The top SJB spokesperson and COPE member asked who decided on such reckless course of action.
COPE member and SLPP lawmaker Rear Admiral (retd) Sarath Weeraselera has said that tax cut was declared to encourage business and trade.
When COPE raised contentious issue of the Central Bank wasting precious funds to prevent depreciation of Sri Lanka Rupee, Dr. Weerasinghe has said this was the responsibility of the Monetary Board comprising five persons. The then Monetary Board member Dr. Ranee Jayamaha has revealed that the then Governor Prof. W.D. Lakshman, Treasury Secretary S.R. Attygalle and nominated member Samantha Kumarasinghe decided on that course of action in spite of her and Sanjiva Jayawardena, PC, opposing them. They had registered their protest in writing.
Dr. Weerasinghe assured the COPE that in spite of the difficulties likely to be experienced within the next three to four months he would try to achieve objectives.
Interdicted Deputy Director at the National Hospital, Sri Lanka (NHSL) Dr. Rukshan Bellana yesterday (29) alleged that the powers that be moved against him for seeking the CIABOC (Commission to Investigate Allegations of Bribery or Corruption) investigation into a massive fraud at the NHSL laboratory.
Dr. Bellana said so in response to The Island query regarding the circumstances the Health Ministry interdicted him on 18 December, through a letter, as directed by the Health Committee of the Public Service (PSC) Commission. “That letter has been signed by an Additional Secretary, as Health Secretary Dr. Anil Jasinghe was overseas,” Dr. Bellana said.
Dr. Bellana stated that the government had paid for reagents, contaminated or close to expiry dates, obtained from a leading local medical supplier, since 2022. He emphasised that his complaint to the CIABOC, and subsequent complaint to the Criminal Investigation Department (CID), were entirely based on the issues raised by the National Audit Office (NAO).
Responding to another query, Dr. Bellana said that the public funds, amounting to Rs. 900 mn, had been spent on chemical reagents past expiry dates. Regardless of the intervention made by the NAO, the NHSL continued to procure supplies from the same company, Dr. Bellana said, adding that he had received the unconditional support of the civil society. Among them were Dr. Chamal Sanjeewa, President of Medical and Civil Rights Professional Association of Doctors (MCPA), President of Academy of Health Professionals Ravi Kumudesh, and leader of Mage Rata Sanjaya Mahawatta.
Dr. Bellana said that he had complained about the scam to the CIABOC in June this year.
Dr. Chamal Sanjeewa, who also lodged a complaint with CIABOC, regarding the same matter, is on record as having said in September this year that the reagents had been procured over a three-year period without the proper approval of the Medical Supplies Division of the Ministry. Dr. Sanjeewa has alleged that some of the reagents were either contaminated or close to expiry dates, while contracts had been given to a single company at unapproved prices.
Dr. Bellana said that had there been a proper system for CIABOC and law enforcement authorities to act on findings made by the NAO they wouldn’t have personally intervened in the NHSL laboratory matter. “Parliament should look into this. Did Parliament take up the NHSL laboratory matter at the relevant watchdog committee or at the Sectoral Oversight Committee that handled health?” Dr. Bellana asked.
Asked whether the letter that informed him of his interdiction gave any specific reason for the action taken, Dr. Bellana said the Ministry had found fault with him for speaking to the media. The irate ex-official said that he never hesitated to take a stand against injustice. “When former Health Minister Keheliya Rambukwella was accused of corruption, pertaining to medical procurement, I condemned the Minister. Lambasted those responsible for wrongdoings.”
Dr. Bellana said that the NAO had dealt with mega crime involving the public and private sector. “That is the undeniable truth. Parliament should look into this as public money is its responsibility. Having vowed to stamp out corruption, the NPP was allowing and encouraging those who had been making money at the expense of the sick, Dr. Bellana said.
Dr. Bellana said that as many as 10,000 tests were conducted daily at the NHSL. The racketeers had been active during Aragalaya as the NHSL and the private supplier reached agreement in 2022 and the process continued even after the last presidential election, conducted in September 2024.
Dr. Bellana said that the long delay in finalising the Auditor General’s appointment exposed the government. If those holding high political office were genuinely interested in fighting corruption, they wouldn’t have allowed that Office of AG stay vacant even for a day.
Dr. Bellana noted the tough statements issued by the Bar Association, Transparency International Sri Lanka and the Committee on Public Finance demanding the immediate appointment of AG.
Health Ministry officials were not available for comment.
By Shamindra Ferdinando
BIA unions, including those affiliated to political parties, are demanding bonuses equal to five months’ basic salaries.
A group of workers yesterday (29) protested outside BIA urging the Airport and Aviation Services Sri Lanka (Private) Ltd to increase their bonuses. They claimed that the Chairman of Airport and Aviation Services Sri Lanka (Private) Ltd., Air Vice Marshal (Retd) Harsha Abeywickrama, had assured them that they would be paid bonuses worth five times their basic salaries.
The SriLankan Nidahas Sewaka Sangamaya (SLNSS) of the airport, the Podujana Sewaka Sangamaya, the Pragathishili Sewaka Sangamaya, the Jathika Sevaka Sangamaya, and the SLNSS of SriLankan Airlines joined the protest.
The Sri Lanka Mahaweli Authority has issued an urgent safety warning to residents living along the banks of the Kotmale Oya and the Mahaweli River, as water levels in the Kotmale Reservoir are reaching maximum capacity.
According to a special weather advisory issued by the Department of Meteorology on December 26, 2025, heavy rainfall is expected in the catchment areas over the coming days.
In response, the Mahaweli Authority released a statement on December 27, warning that spill gates may have to be opened to manage the water flow.
Eng. A.M.A.K. Seneviratne, Resident Engineer and Deputy Director of the Kotmale Reservoir, stated that the opening of spill gates would lead to a significant rise in the water levels of both the Kotmale Oya and the Mahaweli River.
Areas on Alert
Residents in the following Divisional Secretariat divisions are urged to remain extra vigilant:
• Nuwara Eliya District: Kotmale West and Kotmale East.
• Kandy District: Udapalatha, Udunuwara, Doluwa, Pasbage Korale, and Ganga Ihala Korale.
Authorities have advised the public in these low-lying and river-adjacent areas to monitor the situation closely and take necessary precautions to ensure their safety and the protection of their property.
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