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Is forest clearing really necessary for development of agriculture?

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By Upali Cooray

(Former General Manager of CWE)

The Island newspaper has carried a very relevant editorial, on 5th December, as well as in recent times, in respect of the government’s agricultural policies. The government’s policy of permitting Divisional Secretaries to give approval to suitable farmers to clear forests in some areas for agricultural activity, while legal action is being taken against clearing swathes of forests in the Kallaru area, by a political strongman, during the yahapalana regime, amounts to duplicity.

My argument is that it is not necessary to clear forests at all because the present agricultural output would be more than enough if productivity in growing and marketing is improved two-fold. The authority to permit clearing residual forest land has now been given to the district secretary. These officials mostly become flexible in the face of political pressure. Of course, there are exceptions, such as Devani Jayatillake, the female forest officer who stood her ground despite a political strongman trying to force her to permit a wetland to be converted to a playground. The ignorance of one of the politician’s henchman was visible when he asked the female official whether oxygen can be ‘eaten’. (Oxygen kannada?)

It is pertinent to mention here that the constitution of Bhutan compels any of its governments to maintain a minimum of 60 percent forest cover, yet it has a forest cover of 70 percent. Also, it’s a carbon neutral country. I know that Sri Lanka cannot emulate Bhutan, but we must thrive to increase the forest cover as much as possible. What every government in the past has done and is doing is destroying forests gradually.

In order to debase the argument that residual forests should be cleared for agricultural activity, one must first ascertain how the present system of the agricultural marketing chain operates. It is a well-known fact that nearly 40 percent of the produce perishes by the time it reaches the final retailer.

A main drawback is the existence of multiple intermediaries causing low realization to the farmer, high losses and high prices to the consumer. Most of the lower level markets, such as the ‘pola’ and the ‘kada mandi’ markets are underdeveloped and imperfect. Over 90 percent of these markets are periodic, ill equipped and lacking in facilities. The farmers deal with collectors, commission agents and wholesalers. The number of growers who bring their vegetables to the government managed economic centres are a minority.

In Sri Lanka, the farmers have a strong bond with these intermediaries contrary to the perception that the intermediary is a swindler. Though the numbers of farmers, who bring their produce to the Government managed Dedicated Economic Centres (DEC), might show high numbers, many are collectors or traders who operate under the guise of farmers. They may even do some farming while their main activity is collecting. The evil picture of the middleman is not always correct.

The collector or the wholesaler mostly buys the produce from the farmer, on credit, and the settlements are made only when the produce is sold. Besides, many intermediaries are considered as personal friends in need, who will offer credit for contingency expenditure of the farmer family or for occasions such as weddings and funerals, etc, keeping the future harvests as collateral. Therefore these numerous intermediaries of the traditional inefficient channel of very low productivity have become an integral part in our country’s economy.

The hidden cost, healthwise consequent to consuming pesticide sprayed and unhygienically washed and stored vegetables have not been factored by any specialist and I have great doubt that the way the government is going about allowing more forest land clearance for agricultural activity will not give the expected result of increasing farmer income or reducing the cost to the cosumer. Besides this step will reduce the already depleted forest cover further. There will still be farmers engaged in subsistence agriculture at the mercy of the middleman

The DEC project was started in 1998 with the worthy vision of improving the productivity of the agriculture marketing channels and it was expected to be done through modern efficiencies in backward and forward integration. While the government owned the infrastructure, the traders operating were private wholesalers. The board of governors is appointed by the government and generally a person of Additional Secretary level at the Ministry of Trade or District Secretary is the Chairman. However, this seemingly modern idea was distinctive from the totally state owned and operated channels that existed at that time such as now defunct Marketing Department, Markfed and Sathosa. Even then, the private sector traders and wholesalers still dominated the system.

The DECs which have now grown to 15 in number have not been able to serve the purpose for which they were established due mainly to political interests taking precedence over the other economic objectives. Most of them have become political strongholds where middlemen with full patronage of the political strongmen of the areas have made them their power bases than serving farmers and consumers. DECs are just another link in the marketing channel adding to cost of the produce. The millionaire wholesalers obviously are funding their political masters and in return they are protected and allowed to hold sway in the market.

I vividly remember how some years ago, during my tenure in the CWE, a political strongman in an area famous for big onions prevented the CWE from entering into forward contracts with big onion growers for direct purchase from farmers. When he got to know the programme, he nominated one of his henchmen as a Chairman of fake farmer organisation from whom the CWE was directed to purchase onions. Chairman of the farmer organisation was in fact a commission agent. The Central Bank- sponsored forward contract programme, which was of immense benefit to the farmer, was sabotaged by this politician who is still a lawmaker.

Some private sector companies, in Sri Lanka too have done a total integration process of agricultural produce very successfully and a supermarket chain has been able to sell very good quality vegetables at lower or competitive prices. It is reported that the waste has been reduced to 10 percent and the dedicated number of out grower farmers in the chain is over 1,000.

There have been newspaper headlines, such as “fruits and vegetables sold near overflowing toilets” and the title “Dambulla- Economic centre scandal”. There was also a legal case which went before the Dambulla Magistrate where the courts have warned the manager about the unsanitary conditions of the Centre. This is a good illustration of the situation in the vegetable and fruit marketing exercise in Sri Lanka. Vegetable vendors and farmers washing vegetables in polluted canals and drains near the cities and towns is also a common sight.

The use of suitable plastic crates and wooden crates for transporting fresh vegetables and fruits is an effective way of reducing costs and minimising waste which is now said to be around 40 percent.

The primary objective of this exercise should be to give a higher income to the farmer and a lower price and good quality produce to the consumer. It is known that other developing countries which have already done total integration have found that farmer income could be increased by 20 percent and wastage reduced to five percent. Transportation in crates ideally has to begin from the farm gate and end with the retailer which means that the new rule has to be complied with by all concerned in the chain, starting from the farmer, the consumer being the exception.

There is going to be only a very minimal benefit enforcing the transporters and wholesalers/traders to use crates. Then the question arises whether such total integration of the supply chain is practical in the existing marketing channels. The present archaic system is driven by the sole objective of exploitation, nothing else, when the driving objective should be satisfying the needs of the farmer and the consumer. It is necessary to understand the inefficiencies in the present infrastructure set up of agriculture marketing which consequently results in an inefficient wholesale market.

 

Some other developing countries in South America, Africa and, specially India, have done total integration successfully in a completely different manner. Sri Lanka is still proceeding with the same archaic system with inefficiencies aplenty.

One can see lorry loads of vegetables being transported to various parts of the country packed in polypropylene bags and the labourers traveling while sleeping on the bags. The result of this need not be elaborated.

In these circumstances any major overhaul of the system could be manipulated in a manner more advantageous to the trader than the consumer or the producer. The wholesalers will still pay the same low prices to the farmers and keep his unconscionable margins when selling to the consumer. For instance, there have been occasions where Nuwara- Eliya vegetables brought to Dambulla DEC for transport to other parts of the country, have gone back to Nuwara- Eliya for resale during the April season. The reason is pretty obvious.

My umpteen visits and interactions in a long career in matters relating to procurement of agricultural produce, such as onions, potatoes, dhal, dried chilies, coriander, garlic and rice, from India, enabled me to closely interact with major state sector players, private sector traders, companies, farmers in many states of India and I have seen the strides taken by the Indian agricultural marketing channels towards modernization. The change that has occurred is remarkable. The responsibility of managing marketing channels for agricultural produce has been gradually taken over by the private sector companies that are selected by a government bidding process. The setting up of the channels according to guidelines spelt out by the government, is the responsibility of the companies. It is a practically possible and proven symbiosis of state and private sector. This is very much a state facilitated and guided system. The difference is that the most suitable companies with proven track records, and the professionalism, are selected.

The main equity holder is a company selected by a two- stage bidding process. Twenty percent to 40 percent of equity is subsidized by the government depending on the area, but the government, is not a shareholder and has no role other than monitoring to ensure that the company complies with required standards. Only the professionals selected by the company manage it. The farmer to retailer link is straight and there are less or no superfluous intermediaries. Producer and consumer satisfaction is very high.

It is known as the hub and spokes channel. The hub is known as a terminal market situated in a major city or a town. The spokes connect the hub straight, without or with a minimum of intermediaries. The hub offers facilities such as export processing, stocks for wholesale and retail trading, cold storage, temperature and sunlight controlled storage, ripening chambers, packing houses, quality testing facilities, cool chain transport, payments and market information.

Sri Lanka is a country with high humidity. Certain areas in the up country, specially the area in and around Boraland,a in the Badulla district, in the Uva province is very suitable for storage of big onions for long periods of two to three months without perishing. The onions lose weight due to lack of moisture in the atmosphere. The disadvantage is Boralanda is very far from the markets thereby increasing cost. However, the dry atmosphere, with low humidity can be emulated artificially by dehumidifiers or air conditioning near the market. Dried Chillies have to be stored in a very dark atmosphere with dehumidification. Fruits and vegetables in cold storage and ripening chambers.

Farmers bring produce to collecting and grading centres set up by the company in close vicinity to the farm, in crates having cleaned and graded them. Further cleaning and grading is done at the collecting centers. Though farmer/out-grower is dedicated to the company they have the freedom to select the buyer. But the Indian farmers are quite satisfied and happy with the companies and they have a better income, better methods of cultivation and their welfare is assured including support for children’s education.

Most farmers are changing rapidly to Agribusiness and are no longer subsistence farmers. Modern methods of increasing productivity are inculcated among all stake holders by the company. The farmer has instant information about the market, especially the prices, electronically conveyed at the farm. The sale of produce, at the terminal market, is based on electronic auctions and no middleman holds anybody to ransom or manipulate the system. Yet the traditional systems In India have not totally gone away and exists parallel to the modern system. The government does not meddle with it. But one can see it being given tough competition to exist.

Sri Lanka government should rectify the exploiter-based system which will leave no stone unturned to maintain the status quo. It is worthwhile to investigate and see whether there are hidden hands benefiting from the present system. It is high time to give up subsistence farming and inculcate the concept of Agribusiness to the farmer so that he would not be exploited by the middleman.

It will be prudent to think of the idea of operating a terminal market system with the collaboration of the private sector, initially as a pilot project with the option with whatever the adjustments necessary to suit local conditions. Terminal markets are not an Indian idea but appears to be borrowed from developed countries with adjustments in line with Indian market conditions.

I am fully aware that the government finds it difficult to subsidize various services to the people. This should not be a subsidy but only startup support to genuine companies having the expertise.

Let the present system remain with no more DECs. The government need not be shy to get guidance from the private companies that have already done this locally, though in a small way. Such a private state terminal market is a vital necessity in Colombo to compete with the Manning Market and Dambulla – a hotbed of inefficiency, waste and exploitation. The brand new modern vegetable market in Peliyagoda is a good place to commence it.

Let’s hope it will not fall a victim of the politically- controlled vegetable mafia.

The writer can be contacted on (egalawan288 @gmail.com)



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Opinion

Power tariff hikes and need to revamp CEB

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By Ordinary citizen

Ceylon Electricity Board (CEB) has again requested for an increase of 70% in electricity tariffs to settle its past losses. What are these losses and how can the CEB be run as a profit-making Institution? Recently, the Chairman of Public Utilities Commission (PUCSL) has claimed that the CEB had a net profit of Rs. 1 billion last month owing to the increase in rates a few months ago. Is it fair to burden an already economically oppressed public with a 70% increase in rates? While the CEB is making these unfair claims, the minister is silent on solving the problem which is the CEB itself. He even claimed that half the employees of CEB are redundant and what has he done to remedy this situation? CEB and Ceypetco are the biggest loss-making state-owned enterprises (SOE). In spite of losses they continue to pay bonuses and huge salary increases to its employees. They get a 25% salary increase every three years and recently CEB paid Rs. 3679 million to its employees under various ruses. In spite of that CEB employees recently demanded a 36% salary increase and the management has agreed to pay the usual 25% increase and this is at a cost of Rs. 9 billion! A meter reader in the CEB gets a salary of Rs. 120,000, about twice paid to a graduate teacher. General Manager of CEB gets a salary of Rs. 655,310 and a Grade 1 engineer gets a monthly salary of 533, 895 according to their own circulars. In addition, they get additional remuneration for site inspection, overtime, fuel allowance, telephone bill reimbursement etc.

These disproportionate salaries have arisen owing to the high handedness of the Board of Management which has taken decisions against court orders, cabinet decisions and Management services decisions. Since the whole country is dependent on the electricity supply, all Governments in the past have conveniently sidestepped confronting the CEB employees and given all what they ask for.

The Auditor General has pointed out that CEB has paid 1712 million in 2018 and 1873 million in 2019 going against cabinet decisions made in 2007 and Management services circular of 2009. In 2014, CEB Board proposed a 100% salary increase to only Engineers (circular no. 2014/GM/46/Pers dated 27 November 2014 and according to a Court decision (CA/WRIT/193/2015) this circular is illegal, null and void and any payments based on this circular is illegal. However, flexing its muscle, CEB granted a 85% of the salary as an allowance to engineers through Presidential decision on the advice of the attorney general which tantamount to contempt of court. Our politicians have been intimidated with the threat of strikes so as to cripple the entire country and they have no spine to oppose such exorbitant salaries and allowances of CEB employees. They have openly flouted the Government rule that limits all allowances to a maximum of 65%. If we consider other allowances on top of this 85% salary it comes to a whopping 138% of the basic salary! Furthermore, even the PAYE tax of its employees is paid by the CEB in clear violation of the Inland Revenue Act which specifically says that the income tax of an employee has to be paid by the individual and not the employer. These matters have been questioned by the COPE on several occasions but no corrective actions have been taken.

This reminds me of the courage Singapore’s Lee Kuan Yew had in dealing with a work to rule campaign of the Singapore airline pilots union in 1980. He summoned the pilot’s union representatives and gave them a choice. In his legendary remarks, he told them, “If you continue this I will by every means at my disposal teach you and get the people of Singapore to help me to teach you a lesson you won’t forget. And I’m prepared to start all over again or stop it,” Lee said. He further said, “They know that I’m prepared to ground the airline. They know that I can get the airline going again without them. And let there be no mistakes about it. Whoever governs Singapore must have that iron in him. Or give it up. This is not a game of cards. This is your life and mine. I spent a whole lifetime building this. And as long as I’m in charge, nobody’s going to knock it down.” And with that, the matter with the Pilots union was resolved. We do not have leaders of Lee Kuan Yew’s calibre and put the country first leaving aside politics. They meekly surrender to unfair demands of strong unions such as those of the CEB who hold the whole country to ransom with strike actions.

Other actions of the CEB have contributed to the losses incurred by the CEB. They have continuously scuttled cheaper energy options such as solar and buy power from private power plants at exorbitant rates. The powerful Engineers union has blocked new power generating projects such as the 300 MW LNG plant Sobodhanavi. According to them it is cheaper to purchase emergency power from private power plants which is far from the truth. Also, some of these plants could have been absorbed by the CEB through the initial agreement, yet they continue to pay not only the unit cost but also their investment expenditure. CEB has procrastinated actions on at least eleven low cost renewable energy projects in the Long Term Generation Expansion Plan (LCLTGEP) for reasons best known to them and although former President Gotabhaya in his election manifesto promised to get 70% of our energy from renewable sources, the high handed CEB Engineers: union has continuously opposed the implementation of any of the renewable energy projects. Some examples are the 100 MW solar projects at Siyambalanduwa and Pooneryn and the 100 MW wind power project at Pooneryn.

It is grossly unfair to burden ordinary consumers with high electricity tariffs when a complete overhaul of the CEB is what is needed. If the engineers’ union completely blocks such low-cost projects, it is better to go for a 100% privatisation of the CEB, which appears to be the only solution. No politician either present or past have the courage to face the unfair practices at the CEB and this requires the action of the Government at the highest levels and the parliament should debate this crucial issue in parliament and come out with a long-term strategy to provide for our energy needs. Our President appears tough on hapless student leaders and what actions he proposes to take against them. However, he has been silent on this crucial issue while the treasury is pumping around Rs. 500 billion annually to sustain the corrupt CEB and this amount has not even been included in his budget speech. No wonder why we are in such a precarious position where our economy is crumbling.

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Opinion

Alan Henricus- A Stalwart Sportsman Of Yesteryear Passes Away

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Alan Henricus (10-Feb 1933 – 26 Nov 2022)

by Hugh Karunanayake

Alan Henricus the youngest of five outstanding sporting brothers who represented their school Royal College, and their country then known as Ceylon, passed away a few days ago. He would have been 90 years of age if he survived up to his birthday in February next year.

The Henricus brothers grew up in Kohuwela where their father a former Feather Weight Boxing Champion of Ceylon lived. He served as an administrator of the sport first as Hony Secretary of the Amateur Boxing Association of Ceylon and later as its President. He helped build the Baptist Church in Nugegoda and was its Treasurer for 25 years. The road leading to their property was named Henricus Mawatha in honour of this outstanding family.

Alan represented Royal in Boxing, Athletics and Rugby, and won school colours in all three sports. He was also a school prefect, highly respected and regarded by both his schoolmates and staff. The family consisting of five brothers and two sisters were all nurtured in the best sporting traditions of colonial Ceylon. Eldest brother Barney represented Ceylon in boxing at the Empire Games and won a gold medal winning the feather weight title. The next, Basil, held the national record for 100 yards sprint and I believe his record still stands. He also represented the Havelocks Sports Club and All Ceylon at Rugby. The next brother George, for many years the Master Attendant in the Colombo Port was also a champion boxer, as was Derrick the fourth in line.

Remarkable sportsmen such as Alan reached their great heights from a base of raw innate talent fostered by regular training and a disciplined approach to life. When I was a 10-year old schoolboy I used to watch with awe and admiration Alan doing his training run at 6 a.m in the morning, jogging all the way from his home in Kohuwela to the Havelock Park and back on most weekends. Alan was senior to me in school by about three years and in those days that was an age gap filled with respect and admiration for a senior student. To us younger kids the high achieving Alan was a hero.

I recall in one Public Schools Athletics meet for the Tarbat Cup, either in 1950 or 1951,Royal College was able to obtain a total of 15 points only, and were never serious contenders for the trophy. However the 15 points that Royal earned was almost single handedly collected through Alan’s efforts. He won the pole vault event, was first in the 120 metres hurdles, and was a member of the 4 X 400 metre relay team which won the event. Although the Tarbat Cup was won by another school, the assembled gathering of Royalists carried Alan shoulder high around the grounds!

From school he was selected for training as a Naval officer cadet in Dartmouth in Devonshire in England. Fellow Royalists the late Norman Gunawardena, and Humphrey Wijesinghe were among the cadets who were selected for Dartmouth together with Alan. On returning to Ceylon after his naval training at Dartmouth, he served the Royal Ceylon Navy and its successor Sri Lanka Navy for several years until retirement. On retirement from the Navy he served for a short period as an Executive in a Mercantile firm in Colombo, before migrating with his family to Australia.

The stint at Dartmouth would carry many precious memories for him, as that was where he met Maureen the love of his life. On migrating to Australia in the 1970s Alan joined the Royal Australian Navy which he served with distinction as Lieut Commander. On my migrating to Australia in 1984 I met Alan and Maureen at a Sunday luncheon hosted by the late Brendon Goonratne. It was the beginning of a beautiful friendship, and Alan and Maureen remained very close friends of ours.

Over the years we used to meet every three months at lunch at the Rosehill Bowling Club organized for old Royalist Seniors through the initiative of Chandra Senaratne. Other social engagements over the years have strengthened our friendship, and it is with deep distress that I heard of his terminal illness about two months ago. I rang him immediately and he was stoic as ever, the brave naval officer that he was. He said in no uncertain terms that he was not seeking to extend his life on this earth, and that he would wait in his home until the final call.

Alan’s departure marks another severance with the old Ceylon we knew, and its traditions and honorable ways. The Last Post will be played at his funeral at the Baptist Church, Epping on Friday December 2 at 3pm. He is survived by his dear wife Maureen, sons Andrew and Richard,, daughter in law Caroline, and grandson Ryan.

“The song is ended but the melody lingers on “

Farewell dear Alan.

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Opinion

Controversy Over Female Teachers’ Dress To School

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Our country and its people always get involved with unnecessary things which is of no interest to the majority of people. The latest debate in this never -a -dull -moment country (as always for the wrong reason) is the dress the female teachers are expected to wear to school. This is something that should be decided by the Ministry of Education in respect of the teachers of government schools.

I recollect when we were students the majority of female teachers wore saree to school. Then there were several teachers who wore frocks. These were the Burgher ladies. And there was no problem at all. I am not indicating this to show support that the teachers should be left to decide on their dress.

Now the strange thing about this controversy is that Buddhist monks have got involved in the debate and they are trying to determine the dress that teachers should wear. They do not seem to realize that the teachers must pay for the sarees. And they need to possess several sarees as they cannot wear the same saree over and over again. Given the monks get their robes free from the dayakayas, they should never get involved in matters of this nature, even though the female nurses may be happy to have one as the president of their union!

This controversy, if settled in favour of the teachers being given the option to decide on the dress and if they wear various types of dresses, the students too might get a bright idea to wear anything they want rather than the uniform that they have to wear at present.

It might be a good thing if the Ministry of Education could decide on a uniform for female teachers in Government schools. Some private hospitals, private firms and Sri Lankan Airlines have uniforms of their own and one could identify them easily. If there is such a uniform in saree and blouse for teachers in government schools, everybody outside too would be able to identify them as teachers and give the respect due to them.

However, this is not the time to worry about dress for teachers when there are children who do not get a proper education and suffer from malnutrition. It seems our rulers always get their priorities wrong, and this always affects the country and the people adversely. First, the teachers must do their job properly so that the schoolchildren do not have to attend tuition classes. We hear that sometimes only one teacher is available, and as a result the children keep away from attending school.

HM NISSANKA WARAKAULLE

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