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SriLankan Airlines ready to sell stake in its ownership

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by Sanath Nanayakkare

SriLankan Airlines (SLA) would soon announce the sale of an ownership stake subject to Cabinet approval in order to reduce its huge financial stress, Aviation Minister Nimal Siripala de Silva said, in Colombo, yesterday.

The Minister said negotiations with potential investors would be conducted to safeguard the rights of current employees of the airline.

“Today, there is a lot of discussion in the country about the loss-making national carrier and the reforms it should undergo. SLA’s debt payable to an international sovereign bond (ISB) on a government guarantee is USD 175 million. A loan, taken from Bank of Ceylon, mortgaging shares of SriLankan Catering, is USD 80 million. Debt payable to BOC and People’s Bank is USD 386 million. Arrears amount due to CPC, Aviation Services, etc., are USD 325 million. Arrears due for leases amounts to USD 80 million and SLA’s total debt is USD 1,126 million – more than one billion USD.

“SLA doesn’t have the financial capacity to repay these debts as the Airline was severely affected in the past few years and also because of the economic crisis the government itself is embroiled in. The government can’t help out SLA anymore. So, restructuring of SriLankan Airlines, and obtaining capital investments, is critically vital and if such capital infusion does not happen, SLA will certainly collapse and the company will have to be closed down which will end up creating a social distress as 6,370 local and foreign employees are working for the national carrier.

“They are employed in areas of administration, cabin crew, aircraft maintenance, engineers, etc. They could lose employment in such an event. So, it is the responsibility of the government to safeguard the employees, without creating the environment for retrenchment, and also keep the national carrier flying.

“SriLankan was making profits when it was operating as a joint venture with Emirates in 1998, and it was not a burden to the government back then. In the new collaboration we envisage, we will make strategic decisions. The profit-making Ground Handling Division, which is currently undertaken by SLA, is to be continued and administered as a separate unit. Our landing rights, in 26 destinations, which is an invisible asset, will also be retained. We will keep 49% stake of the profit-making Catering Division and offer potential investors the balance shares with a negotiable share of its management.”

“If the restructuring could be completed successfully, foreign debt of USD 175 million, and the bank overdraft obtained from BOC of USD 80 million, could be repaid, as priority payments.

Further, USD 80 million arrears, due for aircraft leases, could be paid and then there won’t be any foreign debt to be paid.”

“It is also significant to note that if USD 466 million, owed to BOC and People’s Bank, could be paid, the said banks will be strong institutions to support the national economy. And when USD 322 million, the arrears payments to CPC is settled, CPC will also be a financially viable institution.

“Therefore, we believe that SriLankan Airlines, its debtors and its employees could only be protected through this restructuring process.”



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Parliament prorogued

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by Saman Indrajith

Parliament has been prorogued with effect from midnight yesterday (27) by President Ranil Wickremeisnghe under Article 70 of the Constitution. The Department of Government Printing issued the Gazette notification annoucing the presidential order yesterday evening.The new Parliament session is scheduled to commence on Feb. 08.

A prorogation, which is a temporary recess of Parliament, should not extend to a period of more than two months, However, such date for summoning Parliament may be advanced by another Presidential Proclamation, provided it is summoned for a date not less than three days from the date of such fresh proclamation.

When Parliament is prorogued, the Proclamation should notify the date for the commencement of the new Session of Parliament, under Paragraph (3) of Article 70 of the Constitution.

During the prorogation the Speaker continues to function and the Members retain their membership, even though they do not attend meetings of Parliament.The effect of a prorogation is to suspend all current Business before the House, and all proceedings, pending at the time, are quashed, except impeachments.

A Bill, motion or question of the same substance cannot be introduced for a second time during the same Session. However, it could be carried forward at a subsequent Session, after a prorogation.

“All matters which having been duly brought before Parliament, and have not been disposed of at the time of the prorogation of Parliament, may be proceeded with during the next Session,” states the Paragraph (4) of Article 70 of the Constitution.

In the light of this constitutional provision, a prorogation does not put an end to pending Business. Thus, a pending matter may be proceeded with from that stage onwards after the commencement of the new Session. At the beginning of a new Session, all items of Business which were in the Order Paper of Parliament, need to be re-listed, if it is desired to continue with them.

At the end of a prorogation, a new Session begins and is ceremonially declared open by the President. He is empowered, under the Constitution, to make a Statement of Government Policy in Parliament, at the commencement of each Session of Parliament, and to preside at ceremonial sittings of Parliament, in terms of the provisions stipulated in Paragraph (2) of Article 33 of the Constitution.

The President is empowered to make a statement of Government Policy at the commencement of each new Session. In the past, it was known as the Throne Speech which was delivered by the Governor-General.

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LG elections may turn violent – CPA

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By PRIYAN DE SILVA

Executive Director of the Centre for Policy Alternatives (CPA) and co-convener of the Centre for Monitoring Election Violence (CMEV) Dr. Paikiasothy Saravanamuttu has warned that the March 9 LG polls (if held) may turn violent as political parties are fighting for their survival as the results of the election may be considered as a referendum. He said it was doubtful whether the election would be held.

Dr. Saravanamuttu sounded this warning at the conference on Campaign Finance Regulations, convened by the CMEV, and Transparency International Sri Lanka (TISL), which was held last Thursday (26). He recalled that once when he asked former President Mahinda Rajapaksa about campaign and party finances, the latter’s reply had been as follows: “I am not going to tell you the whole story, I cannot tell you the whole story and I will not tell you the whole story”

The Campaign Finance Regulation Act became law last Tuesday (24) and Dr. Saravanamuttu pointed out that the former President’s quip highlighted the challenges of collecting information on exactly how much is actually being used. “It is important that the public should know, whether it be cash or kind, from where the money comes from. And the information be made available to the public.”

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President: Cabinet has agreed to implement 13A fully

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President Ranil Wickremesinghe, on Thursday, informed the All Party Leaders Conference on Reconciliation that the Cabinet was agreeable to fully implementing the 13th Amendment.Issuing a statement on Friday, the President’s Media Division (PMD) said the President is bound to implement the laws of the land and the 13th Amendment is a part of the Constitution.

“The 13th Amendment has been in existence for over 30 years. I must implement it. If anyone is opposed, they can bring in a constitutional amendment to change it, or abolish it,” he said.

The President said that the country has to decide whether to fully implement the 13th Amendment or abolish it. “We can’t decide to do neither. Any MP can bring a private members motion to abolish the 13A. What happens when most people don’t support the motion? We will have to fully implement it,” he said.

The President said that he is working, according to a Supreme Court decision, on 13A. “We have to look, especially at the decision given by Chief Justice Palinda Ranasinghe. We are still in the bounds of a unitary state. I am against a Federal state but I support the devolution of power to provinces. The provincial councils don’t even have the powers enjoyed by the City of London. So we can’t call this a federal state,” he said.

Wickremesinghe added that former President J.R. Jayawardane and his lawyers took great pains to prevent the 13A from leading to a federal state. He added that at the end of the war, against the LTTE, a large number of lands in the North and the East, that belonged to private owners, were under the control of the Army. However, most of it had been returned to the people, under presidents Mahinda Rajapaksa and Maithripala Sirisena.

“Only about 3000 acres are under the security forces. The forces must be given the opportunity to release these lands, without hindering national security. The Land Commission, too, must be immediately established. The draft on that can be presented by March. The Commission will have nine members, from each province ,and 12 will be appointed by the President. The we can come up with a national land policy and the Commission can implement the land policy,” he said.

The President said that 30 percent of the land will be allocated for forests. Large swaths of forests, in the upcountry, and in the catchment areas, for rivers, have been destroyed.

“We must increase the forest cover and the Land Commission must be entrusted with this,” he said.

The President added that he will provide further information, on February 08, on how the amendment will be implemented. He urged political parties to submit their proposals by February 04, the Independence Day of the country.

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