News

LSSP blames neoliberal policies for present crisis

Published

3 years ago

2022/12/19

Leader of the Lanka Sama Samaja Party (LSSP) Prof Tissa Vitarana says that the current crisis is due to a shrinking economy and high inflation.

“There is a lack of both dollars and of rupees. The lack of dollars is a result of the neoliberal policies of successive governments, since 1978, which raised our foreign debt to US$ 52 billion and brought down our foreign exchange (forex) reserves from US$ 8 billion to a few millions. The worst offender was the “Yahapalana” government of 2015, led by Ranil Wickremesinghe, which borrowed $ 12.5 billion,” Prof Vitarana says, in a message to mark the LSSP anniversary that falls tomorrow (20)

“When the LSSP is commemorating its 87th Anniversary, I send this message to our friendly people with a feeling of deep sadness. Most of the people of Sri Lanka are facing great hardships at this time of severe economic, social and political crisis. More than 65 % of families, whose income is below the poverty line, are going hungry, the parents having one meal a day so that the children can have two. This too is lacking in protein, vitamins and essential elements Even if they manage to get rice, only about 50% of their protein needs are obtained. This mainly affects the children and the malnutrition levels among them exceed 20%, so that the future generations, too, will suffer with poor physical and mental development. Due to the contraction of the economy many small and medium industries are closing down or cutting staff. Unemployment is rising steeply. Everyone is suffering due to the electricity power cuts, the shortage and high prices of food, fuel, gas and medicines. Thousands of educated youth that the country needs are leaving our shores. Many who remain are enticed to become drug addicts and prostitutes.

“Action taken by Dr.N.M.Perera of the LLSSP, as Finance Minister, to solve the severe 1972/3 crisis provides the basis for a solution. Then the shortage of essential imports and the price rise was higher than today (e.g. the import of a ton of sugar rose from 43 British pounds to 600). He prevailed on the PM, Sirimavo Bandaranaike, to impose severe restrictions on imports and promoted exports to solve our adverse balance of payments situation. He imposed high taxes (75%) on the rich who did not invest their capital for development so that the Government could play a leading role in overcoming the crisis, reduce poverty and develop the country. He promoted science and technology to develop a national economy that would be self-sufficient and increase exports. There were no indirect taxes like VAT that passed the burden of the crisis on to the people, specially the poor. He brought down inflation by strengthening and linking the producer and consumer cooperatives, and strengthened the role of the food and marketing departments, eliminating exploitation by the traders and middlemen. By 1975 he produced a surplus Budget and raised the Foreign Exchange Reserve from USD 1 billion to nearly 4 billion, and restored normalcy, overcoming the crisis.

“The current crisis is due to a shrinking economy and high inflation. There is both a lack of Dollars and of Rupees for the Government. The lack of Dollars is a result of the neoliberal policies of successive governments since 1978 which raised our foreign debt to US$ 52 billion and brought down our foreign exchange (forex) reserves from US$ 8 billion to a few millions. The worst offender was the “Yahapalana” government of 2015, led by Ranil Wickremasinghe, which borrowed $ 12.5 billion. The dollar crisis is due to an annual debt servicing cost, which last year was $ 6.3 billion. It was not due to an adverse foreign trade balance, as our forex earnings in 2021 were $ 21 billion, exceeding our import cost of $ 20 billion by one billion. I am glad that the SLPP Government stopped the import of vehicles and the present Government has banned the import of a large list of non-essential imports. If this is properly done there will be no need to borrow further from the multilateral donors, led by the IMF, and get further into debt, and also have to sell our valuable assets. We can escape the debt trap and have the dollars to get the fuel, fertiliser, gas, food and medicines that the people need, keeping the price down, by properly run Sathosas, Cooperatives, etc. A five-year moratorium on debt will give us $ 35 billion to develop value-added industries using our agricultural and natural resources (ilmenite and graphite) to provide jobs for our youth. The technology will be provided to SMEs through the Vidatha Centres at Divisional level and Hi-Tech at central level e.g. SLINTEC nanotechnology) with emphasis on exports.

“Immediate action must be taken to bring down the cost of living. Left Government policies must be combined with empowerment of the people. Properly elected producer and consumer Co-operatives will ensure that the producer gets a proper price while the consumer cost is minimized. The middlemen exploitation is eliminated. Low interest credit for farmers and entrepreneurs from the Central Bank Fund could be made available through the Rural Banks and Vidatha Centres. The problem of rural microcredit at high interest must be overcome. Farmers will be supported to practice ecoagriculture. All failed state and private institutions could be run under the “solidarity economy” principle, where the lease/ ownership will be in the hands of the workers, who alone get the profits, having one share each in the company. Through these and other measures it will be possible to recover from this crisis, as Dr. N M Perera did in 1972/3. Sri Lanka can emerge from this crisis, eliminate poverty and become a developed country if a progressive Government which implements the above LSSP policies comes to power. I invite all honest people who accept these policies to join us to get rid of poverty and make Sri Lanka a developed country.

“The LSSP was formed in 1935 and led the fight for national independence. The LSSP was banned and its leaders like Dr N M Perera and Dr. Colvin R de Silva jailed. They broke jail and escaped to India where they joined the independence struggle led by Gandhi and Nehru, as part of the Congress Socialist Party. They returned at the end of the war in 1945 and led the General Strike of 1947 in which the Police fired at Dr. N M Perera, but comrade Kandasamy who was by his side died. The Great Hartal of 1953 was led by the LSSP against the raising of the price of rice by the UNP Government from 25 cents a measure to 72 cents. When anti-Tamil racism was at its worst and Sinhala only was made the official language the LSSP fought for Tamil also to be made official. Yhis was finally granted in 1957. Sri Lanka became a truly independent sovereign state with the passing of the Republican Constitution drafted by Dr. Colvin R de Silva in 1972.”

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National Audit Office reveals NHSL lapses

Published

2 hours ago

2026/01/1

Thilina Walpola

Reagent scandal:

Deputy Director of the National Hospital, Dr. Rukshan Bellana, has been interdicted by Health Service Committee (HSC) of the Public Service Commission (PSC) following a preliminary inquiry into several complaints received against him, government sources said.

They said certain matters referred by the Secretary to the Prime Minister Dr. Harini Amarasuriya and Inspector General of Police (IGP) Priyantha Weerasooriya, too, had been taken into consideration.

A Health Ministry official said there was no truth in Dr. Bellana’s claim, as reported in the 30th December edition of The Island, that the Health Ministry had sacked him on the approval of the HSC of the PSC over him taking up the massive Rs 900 mn fraud involving the supply of chemical reagents to the laboratory of the National Hospital of Sri Lanka (NHSL) in Colombo, which is the premier hospital in the country.

Sources said that there was absolutely no basis for this allegation. The official said that Dr. Bellana had been interdicted for issuing statements that caused controversy and turmoil among the public. That’s the most serious offence that had been taken into consideration when the decision to interdict him was taken, sources said. “There will be a spate of charges in the charge sheet to be issued soon.”

The interdiction of medical officers could not be carried out by the Ministry of Health and Mass Media, as the Ministry was not vested with disciplinary authority, sources added.

Dr. Bellana said he stood by what he revealed and had evidence to support his claim.

Health Ministry sources acknowledged that the National Audit Office (NAO) on June 6, 2025, had called for information in respect of chemical reagents procured by the National Hospital Colombo NHSL laboratory from 2022 to 2024.

Responding to another query, sources said that a separate investigation by the Internal Audit of the Ministry of Health was on into issues raised by the Audit query pertaining to the lab of the NHSL.

Having pointed out that the government paid Rs. 894,186,168 (2022), Rs. 713,652,615 (2023) and Rs. 936,152,767, totalling Rs 2,543,991,550 for chemical reagents during that period, NAO sought an explanation from the Health Ministry as to how Rs 12,894,697 worth of chemical reagents past expiry dates were found in six laboratories at NHSL during examination carried out on April 7,8,10,21 and 22 in 2025.

The NAO also raised the failure on the part of the relevant authorities to secure the approval of the Medical Supplies Division (MSD) before placing orders with local suppliers for chemical reagents.

The Health Ministry was questioned over the absence of proper stock keeping regarding Rs 2544 mn worth chemical reagents issued to NHSL laboratories. The NAO ascertained that Financial Regulations 751 had been violated. As a result of the absence of credible stock keeping, the NAO hadn’t been able to ascertain whether shelf-life expired chemical reagents were misused, the government authority stated.

The NAO asked for an explanation regarding the payment of Rs 912,838 over the required amount to a local private supplier (NAO named the supplier) for chemical reagents obtained.

In one of the most serious observations, NAO pointed out that shelf-life expired chemical reagents had been used for tests. The NAO raised this while pointing out the Health Ministry violated a key prerequisite in the procurement of chemical reagents that their shelf life should be at least 85% at the time of receiving consignments. Instead, all stocks procured had less than six months shelf life, NAO stated.

NAO declared that some suppliers refrained from mentioning the date of manufacture and the time of expiry.

The above mentioned were some of the issues that had been raised by Audit Superintendent Y.M. Sugathadasa on behalf of the Auditor General who is the head of the NAO. The post of AG remains vacant since December 8, 2025. Earlier incumbent W.P.C. Wickremeratne retired on April 8, 2025 after having served as AG for several years. President Anura Kumara Dissanayake and the Constitutional Council haven’t been able to reach consensus on a permanent appointment yet.

By Shamindra Ferdinando ✍️

News

NPP’s CMC budget passed after four Opp. members switch allegiance

Published

2 hours ago

2026/01/1

Thilina Walpola

The Opposition has claimed that the government forced three of its Colombo Municipal Council members to to skip yesterday’s vote on the annual budget of the Council. The three councillors who voted with the SJB-led Opposition on 22 Dec., to defeat the NPP, skipped yesterday’s vote.

Two of them didn’t turn up yesterday while the other one left the Council early, claiming his wife was not well. One of the four SLMC councillors switched his allegiance to the NPP. having voted with the Opposition on 22 Dec.

As a result, the CMC’s annual budget was passed with a majority of two votes.

The budget proposal received 58 votes in favour, while 56 councillors voted against it. Last week, the Opposition obtained 60 votes to defeat it, while the NPP managed to secure only 57.

When the 2026 budget of CMC was first presented to the council on 22 December, 60 councilors voted against it while 57 members voted for the budget.

In the last Local Government Elections, the NPP secured power in the CMC and its mayoral candidate Vraie Cally Balthazar was elected as the Mayor of Colombo by securing 61 votes. (SF)

News

600MW hit to national grid as two Norochcholai units go offline

Published

2 hours ago

2026/01/1

Thilina Walpola

Sri Lanka’s power system has suffered a major setback with two of the three generators at the coal-fired power plant at Norochcholai going out of service, cutting around 600 megawatts from the national grid, even as Energy Ministry officials stressed yesterday that the issue is minor and fully under control.

One unit has been offline since November for scheduled major maintenance carried out once every three years, while another was shut down following a technical fault in its boiler. As a result, only one generator, at the country’s largest and only coal-fired power station, is currently supplying electricity to the grid.

Despite the sharp reduction in coal-based generation, a senior spokesperson for the Norochcholai Power Plant assured that there would be no disruption to electricity supply, as hydroelectric power generation is being increased to compensate for the temporary shortfall from Norochcholai.

Ministry of Power and Energy officials also confirmed that the situation is not serious and does not pose a risk to the stability of the national grid. “This is a minor technical issue and routine maintenance activity. There is no cause for public concern,” a senior Ministry official said.

Meanwhile, a top official of the Ceylon Electricity Board (CEB) said all three units of the Norochcholai Power Plant are expected to be restored by the first week of January, delivering the full 900MW capacity back to the national grid.

“Current reservoir levels are favourable, allowing us to rely more on hydropower during this period,” the CEB official said, adding that system operations are being closely monitored.

A senior electrical engineer told The Island that one unit had been shut down in November for routine maintenance, while another unit suffered an unexpected breakdown earlier this week. “Such incidents are not unusual in large thermal power stations. Corrective work is already under way and the units will be brought back online as scheduled,” he said.

Norochcholai remains the backbone of Sri Lanka’s base-load electricity generation, and while prolonged outages could place strain on the system during dry periods, officials reiterated that current conditions and contingency measures are adequate to ensure uninterrupted power supply until full operations resume.

By Ifham Nizam ✍️