The goose and the golden egg
Labour Minister Nimal Siripala de Silva has accused the plantation industry of attempting to sabotage the 1,000 rupees a day wage award by resorting to court action. A pile of cases have been filed in the courts challenging the wages board award and when these will be determined is not yet clear. The case was called on Friday but not taken up at the time of writing and had later been postponed for Tuesday. Equally unclear is whether the challenge that has been mounted by regional plantation companies (RPCs), tea factory owners and other interested stakeholder will succeed or not. If it fails, will plantation workers get the promised thousand rupees with arrears? What will the employers do in such an event? The whole picture is murky with both sides having dug their heels in. The demand from the workers is very long standing and has seemingly been under negotiation forever. The industry response from the RPCs is that they just can’t afford to pay this wage and keep the estates viable.
Other noises too have been heard. Among the more ridiculous of these is that the government will take the estates back if the employers do not fall in line with the 1,000-rupee wage. Post land reforms, the big estates were not sold to the RPCs or anybody else. The Sri Lanka State, And hence the people, retains the ownership of these properties. What happened was that two state-owned entities, the Sri Lanka State Plantations Corporation (SLSPC) and the Janatha Estates Development Board (JEDB), were entrusted were entrusted with their management. Former Finance Minister Ronnie de Mel was fond of often saying that “the magic is in the management.” Unfortunately where the nationalized plantations of this country were concerned, there was no “magic” in their management. The result was mounting losses and near-total disarray.
That was when post-1977, the decision to privatize the management of the plantations was taken. During President Premadasa’s tenure, the plantation assets were grouped into regions but, with an abundance of good sense, they were not allocated region-wise to what were termed the Regional Plantation Companies that took the management contracts. This was because of climatic factors like rainfall, or the lack thereof, that determine performance of plantations. Therefore the different RPCs were entrusted to manage a mix of estates in different climatic zones; and this logic has proved impeccable. There was, and there is, in this country strong opposition to divesting national assets to private interests and President Premadasa brilliantly overcame this hurdle. He did not call what was being done “privatization” but coined a new word “peoplization” to describe the process then underway. To top it all, he gilded the lily by giving the plantation workers a 10 percent stake in each of the RPC’s free of charge. He believed that this would give the workers a sense of ownership of their workplaces.
That did not work out quite as intended. The RPCs were listed on the Colombo Stock Exchange and their shares, like those of any other quoted company, were freely tradable. That resulted in most, if not all, workers selling their shares to ready buyers. While there were small windfalls for a large number of people, the proprietorial sense that President Premadasa was aiming at did not result. The plantation economy as most people know is highly dependent of climate and prices. As a result it is cyclical with frequent ups and downs. Editorialists, once upon a time, were fond of writing “tea needs sympathy while rubber has lost its bounce.” Right now, fortunately, the green leaf price of tea is around a remunerative 100-rupee level and rubber which was deep in the doldrums is picking up.
Tea is a particularly labour intensive industry with about 70 percent of the cost of production being the labour component particularly of harvesting. The employers tried as best as they could to persuade the unions to accept a productivity based wage model enabling the demanded Rs. 1,000 to be earned and even topped by bringing in more leaf than the prevailing norm. But the unions, some might say stubbornly, resisted this formula presented as a win-win proposal, There is no escaping the reality that worker productivity in our tea fields falls far short of those prevailing in other big tea producing countries like India and Kenya. But the highly unionized labour, conscious of the political muscle they command, have flatly refused to take this route. Their unions with the ability to deliver block votes at elections are able to effectively influence the various contenders as they have done time and again.
The cost of a wage increase to the employer is not only the basic wage. There are various other costs like EPF/ETF, holiday pay, gratuity, maternity benefits and more involved. Over and above that, a very large number of persons who do not work on the plantations live on them occupying estate housing and benefiting from the plantation-paid infrastructure. This builds up to a formidable figure which, according to the RPCs, the industry cannot afford. On the flip side of the coin are management expenses and fees payable to the controlling shareholder. This has sometimes been waived during lean times but not always. Mr. Arumugam Thondaman, at one round of negotiations with an RPC, once told the employer on the other other side of the table, “You pay your CEO a million rupees a month and grudge the worker 1,000-rupees a day.” But the employers say that management costs absorb only about 8% of the COP.
Given the current cost of living and prevailing wage rates outside the plantations, the demanded wage is obviously not unreasonable. Against that the worker too must contribute in productivity terms to ensure that his livelihood provider is viable. A dead goose cannot lay golden eggs.
Crime of booing
Tuesday 28th March, 2023
The efficiency of the police is truly amazing, the only problem being that it is selective. Our brave cops sprang into action and arrested a person after giving chase in Homagama over the weekend. His crime? He booed Minister Bandula Gunawardena while driving past a ceremony where the latter was laying the foundation stone for the construction of a Buddhist shrine.
What is the world coming to when those who have plundered public wealth, committed many crimes including murder and bankrupted the country are given police protection and citizens who express their displeasure at the government by booing are arrested? The Buddha forgave those who even tried to kill him, didn’t he? So, it defies comprehension why anyone should be arrested for jeering at a politician at a Buddhist religious event.
There is reason to believe that the police went above and beyond the call of duty to please Minister Gunawardena. Opinion may be divided on the protester’s action and the reaction of the police, but that is not what we intend to discuss, today. Suffice it to say that booing is symptomatic of bubbling public anger, which the government cannot contain with the help of the police. When a youth was arrested in April 2021 for sounding the car horn in protest against the police closing a road in Borella for a motorcade transporting a group of foreign dignitaries to pass, the media rightly questioned the wisdom of the government and warned that the situation was likely to take a turn for the worse. Police action did not deter the public from protesting. Subsequently, the then President Gotabaya Rajapaksa himself was booed while he was passing a long line of people near a milk food outlet. A few months later, the people took to the streets and ousted the President. That is how public anger wells up and fuels uprisings.
The police have reached peak performance during the past several months; their remarkable feats include using batons as magic wands to make unruly protesters in robes levitate over tall walls of the Education Ministry! While hunting down undergraduates, they have also arrested some underworld kingpins. When a restaurant owner was gunned down in Hanwella recently, not many expected his killer to be even identified, but the hired gun, known as Booru Moona was arrested in record time. The crime busters have also taken into custody some key figures in a drug cartel run by a criminal known as Harak Kata, who was arrested in Madagascar and extradited.
Curiously, the police lack this kind of high-octane performance where some crimes are concerned. The killers of a large number of persons including The Sunday Leader Editor Lasantha Wickrematunge and ruggerite Wasim Thajudeen are still at large, and their family members and friends have been seeking justice for more than a decade.
Worse, the police sometimes choose to turn a blind eye to serious offences committed under their nose. A few weeks ago, there was a public outcry over the presence of a large number of ‘unidentified’ armed men in uniform similar to that of the army near a university students’ protest in Colombo. Armed with assault rifles and clubs and iron rods, they were operating alongside the army and the police in full view of the media and the public. Both the army and the police have said those men are not their personnel. If so, who are they? It is a non-bailable criminal offence for anyone to carry firearms without permission and he or she must be arrested and produced in court. The police should have arrested those characters before cracking down on the protesting undergrads.
Will the police, who swing into action and arrest jeerers before one could say ‘boo’, so to speak, explain why they have not cared to identify the armed men who were seen with them near the Colombo University recently?
Tissue of lies and other issues
Monday 27th March, 2023
There is no bigger lie than the oft-repeated claim in some quarters that the 21st Amendment to the Constitution has helped strengthen democracy by ridding vital state institutions of dirty politics. Perhaps, the doormat at the entrance to the President’s Office receives better treatment than the supposedly independent Election Commission (EC), which suffers many indignities at the hands of some government politicians.
Prime Minister Dinesh Gunawardena was economical with the truth, which he also stretched and bent, in Parliament on Friday, when the Opposition questioned him on the postponement of the local government (LG) elections. The PM, who is also the Minister of Provincial Councils and Local Government, said he would meet the members of the EC for a discussion on poll-related issues soon. There is nothing to be discussed about elections! The government should either allocate funds for the LG polls or officially inform the public that it is scared of facing an electoral contest and therefore cannot hold the mini polls. Its refusal to release funds for elections on some flimsy grounds has only eroded public confidence in the electoral process, and given a turbo boost to anti-politics, which is manifestly on the rise and rapidly eating into the vitals of the state.
It is a pity that PM Gunawardena, who gained national prominence by standing up to a dictatorial UNP government under President J. R. Jayewardene, taking up the cudgels for the people’s franchise and winning the Maharagama by-election, in 1983, against tremendous odds, is now backing those who are all out to put off elections. President Jayewardene scrapped the 1982 general election for fear of losing his five-sixths majority in Parliament, and held a heavily-rigged referendum instead, undertaking to hold by-elections in the electorates where the UNP would lose. He had to hold 18 such by-elections, four of which were won by the Opposition despite large-scale rigging and violence unleashed by the UNP. Anil Moonesinghe, Richard Pathirana and Amarasiri Dodangoda won the Matugama, Akmeemana and Baddegama electorates, respectively. Forty years on, Gunawardena and the late Pathirana’s son, Ramesh, are backing Jayewardene’s nephew, President Ranil Wickremesinghe, who is putting off elections!
Unfortunately, it is Finance Ministry Secretary Mahinda Siriwardena who has had to take all the flak for not making funds available to the EC. He has become a soft target that everybody who lacks the courage to take on President Wickremesinghe turns on. Government Printer, Gangani Liyanage, is also in a similar predicament. Siriwardena allocated funds for the EC, albeit in dribs and drabs, before being asked by the Cabinet and the President in no uncertain terms to stop doing so. The government has pinioned him to the wall, and the Opposition worthies are punching him, and not those who deserve their blows. Let those heroes be urged to pluck up the courage to attack the President instead of turning on the public officials whom the government has put in the straitjacket of zero-based budgeting. These mandarins find themselves in an unenviable position; the government is preventing them from carrying out their duties and functions according to their conscience, and the Opposition is bashing them.
The SLPP MPs keep saying that they want the LG elections held. It is they who postponed the mini polls first, in 2022. However, if these politicians who are as crooked as a barrel of fish hooks are being truthful for once, then it will be seen that all members of Parliament, save the single UNP member and perhaps several others who have pledged their allegiance to President Wickremesinghe, are against the postponement of elections, and, worse, the President is refusing to allocate funds for the LG polls against the will of the vast majority of MPs! Parliament controls public finance, and therefore it must be allowed to decide whether to allocate funds for elections. Let a resolution be presented to Parliament to that effect and a vote taken thereon urgently.
Minister Kanchana Wijesekera informed Parliament, on Thursday (23), that President Wickremesinghe had asked for a division by name on the government’s agreement with the IMF so that the public would know who was supportive of the IMF programme and who was not. The same modus operandi could be adopted, if a vote is taken anent the LG polls, so that the public will know who actually wants the elections put off. This is the most democratic way of deciding whether to hold the LG polls or postpone them.
North Korea is reported to have recently tested a secret weapon capable of causing tsunamis. The Rajapaksa-Wickremesinghe regime, which often warns that Sri Lanka might end up being a country like the hermit kingdom unless its economic programme is followed, has resorted to an ill-advised course of action that is fraught with the danger of triggering a tsunami of public anger. Its members have apparently forgotten the firenado, as it were, which hit them in May 2022.
More heavy lifting to be done
As President Ranil Wickremesinghe tirelessly stressed, the signing off on the Extended Fund Facility (EFF) with the International Monetary Fund marks a new beginning. “Forget the past and the old games,” he has said seeking the cooperation of both the opposition and the media for a great leap forward. He has made the point that the IMF arrangement of USD 2.9 billion opens the doors for further credit adding up to USD 7 billion from elsewhere. When he met editors and other media heads on Thursday he said we have to continue negotiations with bilateral and multi-lateral lenders as well as private creditors which he admitted would be the most difficult.
The bad news when this was being written on Friday was that unless there is a dramatic change of heart on the part of the executive, the likelihood of the scheduled local government elections in the foreseeable future appears more than remote. There are, of course, a clutch of cases before the courts at present and which way the determinations will go is not clear right now; also in which direction the dice will roll once the courts rule. But it is patently clear that both the president and the government want these elections as much as they want a hole in the head.
There is no need to labour the reason why the incumbent establishment does not want local elections at the present moment. This, notwithstanding SLPP General Secretary Sagara Kariyawasam’s mealy-mouthed protestations that his party does not wish these elections put off. The electorate is very well aware that these elections cannot mean a change of government. Wickremesinghe is safely ensconced on his presidential throne until Gotabaya Rajapaksa’s term runs out in November 2024. Wickremesinghe is constitutionally empowered to dissolve parliament whenever he wishes from now until then. That’s the whip-hand he holds over his SLPP backers who made him president. It will safely ensure that they will not rock the boat during his tenure.
Just as much as the president and his government do not want any election in the short term, the opposition parties are literally panting that these be held soonest for reasons that are all too obvious. The last time the country elected local bodies was in February 2018 and the Rajapaksa party was the comfortable winner. The credit for this within the SLPP was widely apportioned to Basil Rajapaksa, its national organizer. That election victory heralded the coming of Gotabaya Rajapaksa in November 2019 and the Mahinda Rajapaksa government the following August. This is why the opposition, principally Sajith Premadasa’s SJB and the JVP-led National People’s Power (NPP), is striving might and main to have this election one way or another. The present signal is that they will not succeed in this endeavour. But as in cricket, there is no certainty in the outcome.
Though the president requested that the old games must not be played any longer, his supporters don’t practice what he preaches. There was a vulgar display of firecracker lighting, in true Sri Lankan style, greeting the announcement that the IMF deal was through. Everybody and his brother well know that this polluting lighting of strings of firecrackers greeting election results, politicians arriving at meetings and other similar events are funded by the politicians themselves. Some ghouls even lit crackers when President Premadasa was assassinated. We don’t know whether last week’s cracker lighting was a command performance or of old habits persisting. Whatever it was, it was unseemly.
The mere fact the IMF deal is through does not mean that the country is going to emerge from the economic morass in which it is mired. A great deal of heavy lifting remains to be done. The initial benefits cannot be more than a trickle. Possibly the June negotiations down the road may be an opportunity to offer some tax relief to professionals loudly protesting that the new rates are totally unrealistic. We run a letter from a retired Commissioner General of Inland Revenue in this issue who says that in his view, the problem is not with the rate of taxation which is between six and 36% but with the exemption threshold.
He rightly says that given today’s hyper-inflation. high cost of electricity, water and essential food, the Rs. 1.2 million exemption threshold is far too low. He believes that if this is raised to at least Rs. 1.8 million a year, it may be possible to win the unions over and reduce the tax burden on high income professionals. He has said this should not impact on the IMF agreements and the time has come for a compromise between the government and protesters. Clearly the now retired writer will not have access to actual numbers. But given his long service in the tax department, he would have an instinct for these matters.
It is also pertinent to say here that it is time the government makes a statement about the safety of the country’s banking sector. There are many worries on this score particularly after what happened recently in the U.S. and in Switzerland. It is well known that our state banks have been captive lenders to insolvent state-owned enterprises with such loans underwritten by the government. The fact that the IMF deal was successfully concluded, no doubt, is a reassuring factor about the stability of our commercial banking system. Nevertheless, a statement from the government will reassure constituents.
Veteran singer and musician Professor Sanath Nandasiri passed away at the age of 81
Clearview AI used nearly 1m times by US police, it tells the BBC
Second ODI between New Zealand and Sri Lanka abandoned
‘Dates have the highest sugar content to fight Coronavirus’
Sunday Island 27 December – Headlines
U.S. Congress to probe assets fleecing by US citizens of Sri Lankan origin
Features4 days ago
Happy Birthday dearest Mrs. Peries !
News3 days ago
Mano says LG and PC elections equally important
News5 days ago
Decorated gunship pilot blacklisted for appearing on political stage
Midweek Review6 days ago
Growing foreign dependency and India’s USD 4 bn lifeline
News5 days ago
No more selling of Hajj visas, assures Minister
Breaking News6 days ago
Property tax to be replaced with Wealth Tax, Gift Tax and Estate Tax – President
Editorial6 days ago
Celebration of debt
Sports5 days ago
Sri Lanka’s flawed ODI strategies