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The Finance Company depositors eligible to be paid Rs 500,000 each more

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By Saman Indrajith

State Minister Money, Capital Markets and State Enterprise Reforms Ajith Nivard Cabraal told Parliament, yesterday, that the depositors of the failed the Finance Company (TFC) would be paid Rs. 500,000 each from the liquidity fund in addition to the Rs. 600,000 they had been paid under the Sri Lanka Deposit Insurance and Liquidity Support Scheme.

The Minister said so responding to a question raised by Opposition Leader Sajith Premadasa, who demanded to know from the government what measures had been taken to assist the aggrieved depositors of failed finance companies in the country, including TFC.

The Minister said that around Rs. 12 billion would be utilised to pay the depositors from the fund which currently stood at Rs. 60 billion. The decision on the additional payment had been made on a directive from Prime Minister Mahinda Rajapaksa, Parliament was told.

“We started the liquidity fund in 2010 with Rs. 1.1 billion when I was the Governor of the Central Bank and current Prime Minister Mahinda Rajapaksa was the President. Both the President and the Prime Minister have decided that the depositors of The Finance Company be paid Rs. 500,000 each more from this fund. It will be done soon with the approval of the Monetary Board and in consultation with the Central Bank.”

TFC had approximately 147,000 depositors at the time its licence was cancelled in May last year, but those whose deposits were Rs. 600,000 or less were paid the full amount.

Minister Cabraal said that a Cabinet paper had already been submitted for the restructuring of TFC and once it was approved, steps would be taken to find an investor for the company and settle all default payments to the depositors.

“A Cabinet paper has been submitted and depending on the decision of the Cabinet, we will move forward with the restructuring,” the Minister said.

He said that in addition to TFC, six other finance companies had collapsed, all during the previous administration.

“Before 2015, we took several measures to safeguard the sector. In 2010, we started the Deposit Insurance Fund and we also started the financial sector consolidation programme, under which we reduced the number of finance companies from 58 to 20 and strengthened the sector. Unfortunately, after 2015, that programme was shelved and the sector began facing numerous problems from then onwards.”

He said that the government’s priority was to safeguard the interests of the depositors and the decision to pay an additional Rs. 500,000 showed the commitment to them.

Minister Cabraal said that the Central Bank had cancelled the licence of TFC from May 22 after all efforts to revive the company through different strategie had failed.

 

 



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Massive revenue loss: Eyebrows raised over delay in responding to House query

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SLPP members say sugar deal black mark on govt.

By Shamindra Ferdinando

Many an eyebrow has been raised over the delay on the part of the Finance Ministry to respond to a Finance Committee (FC) request for a comprehensive report on an alleged fraud in the controversial sugar tax revision.

Chairman of the Finance Commission Anura Priyadarshana Yapa on January 5 issued instructions to the Finance Ministry in this regard when the FC considered several special gazette notifications pertaining to the Ministry of Finance issued since October 2020.

According to the Communication Department of Parliament, MP Yapa on Feb 25 told the FC that the report called by him hadn’t been received yet. Yapa said so when State Minister Vidura Wickramanayaka and SLPP MP Nalin Fernando alleged the revision of taxes pertaining to the import of sugar hadn’t benefitted the consumers at all and only caused loss of revenue to the State. Severe criticism of the revision of sugar taxes was nothing but a black mark on the government.

Asked whether the report had been received since the issue at hand was taken up on Feb 25, the former Minister said that the FC answered in the negative.

Yapa told the last FC meeting that the Department of Import Control should be able to submit analytical comments with data on the relevant gazette amendments. Having approved the regulations issued on that day in respect of the issuance of licenses for the import of brown sugar, the FC recommended that a full explanation be given on March 09 with the participation of all relevant Ministries and Institutions.

Parliament is scheduled to meet on March 9.

Yapa is on record as having told the FC on January 5 though the tax on imported sugar was revised downwards to 25 cents from Rs. 50.00 per kilogram through the Gazette Notification No. 2197/12 issued by the Ministry of Finance on 13th October 2020, the move did not benefit the consumers at all.

JVP leader Anura Kumara Dissanayake lambasted the government over what he called a massive sugar scam that caused losses amounting to Rs 10 bn. In addition to the JVP, the SJB and UNP flayed the government over the corrupt deal. Dissanayake questioned the rationale in increasing the tax on sugar from Rs 33 to Rs 50 on May 23, 2020 and then bringing it down steeply to 25 cents on Oct 13, 2020. Dissanayake said that at that time the tax was brought down to 25 cents, there had been 90,000 metric tonnes of imported sugar in the country. Having reduced the sugar tax to 25 cents, the government directed that a kilo of sugar be sold at Rs 85, MP Dissanayake said.

The JVPer alleged that subsequently, when the government wanted to increase the sugar tax by Rs 40, Commerce Minister Bandula Gunawardena said that once imposed tax couldn’t be altered for a month, hence the decision to continue with 25 cents tax till Nov 13, 2020.

MP Dissanayake on Dec 12, 2020 named all those involved in the sugar scam.

Lawmaker Dissanayake said that the country suffered massive losses due to corrupt sugar deals. Those who suspended imports claiming the country faced severe foreign exchange crisis allowed massive corruption at the expense of the national economy.

Dissanayake said that last year alone at least 73,000 metric tonnes were imported at 25 cents tax.

He pointed out that the Treasury was responsible for facilitating sweet deals at the expense of the national economy. The revenue which should have been received by the government ended up with racketeers, Dissanayake lambasted the government for allowing its cronies to flourish.

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JVP expresses solidarity with Black Sunday campaign

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The JVP-led NPP yesterday expressed solidarity with the Black Sunday campaign seeking justice for the Easter Sunday carnage victims.

A statement issued by the party said that the Presidential Commission of Inquiry into the Easter Sunday carnage had released its report but the general consensus was that the inquiry had failed to bring justice. The PCoI report had only made the matter complex by creating some more puzzles instead of identifying the masterminds of the terror strikes.

The JVP has said Sri Lankans will never forget the Easter Sunday terror attacks of 2019 where nearly 300 perished and more than 500 others were wounded and became disabled for the rest of their lives. It is no secret that it was the failure on the part of the previous government to prevent the attacks that led to the destruction of lives and properties. The appointment of the commissions to investigate the incident was the only response of the former and incumbent governments. It is now clear that the commission has failed to identify the masterminds, owing to political reasons. Demanding justice is a human right. The Catholic Church has called on people to mark the coming Sunday as a day of agitation, demanding justice. We, of the NPP, extend our fullest support for the campaign and urge the law enforcing agencies to take action without further delay to bring about the masterminds and offenders of the crime, the statement has said.

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Iranaitivu islanders protest against burying of coronavirus victims there

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By Rathindra Kuruwita

Residents of Iranaitivu Island yesterday forcibly filled up the burial sites prepared for those who had died from COVID-19 and held a demonstration against burying coronavirus victims on the island.

The protesters claimed that the media had reported those who died from COVID-19 would be buried on the island and that some group had already prepared a burial site. However, the residents of the island had not been consulted, they said.

They claimed that even during the war they had fought for the right to live on the island and they were opposed to the decision taken by the government to bury COVID-19 victims on the island.

 The protesters claimed that it was a cunning plan by the government to drive in a wedge between Christians and Muslims in the area. The government should have earmarked a deserted island for that purpose, they said. The protest was led by Christian religious leaders and local politicians. 

Iranaitivu is situated 10 km from Mannar and can only be accessed by boat. Cabinet Spokesman, Minister Keheliya Rambukwelle said that it was not a political decision and that health experts had taken it after careful consideration. He added that a vehicle especially made for this would be used to transport bodies to the island. This vehicle would include a freezer and the driver would be isolated from the bodies. Two family members would also be allowed to attend the funeral.

 

 

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