PSC to investigate on Economic assassins | Daily News

PSC to investigate on Economic assassins

Prof. Charitha Herath
Prof. Charitha Herath

Committee on Public Enterprises (COPE) Chairman Prof. Charitha Herath yesterday recommended that a Parliamentary Select Committee be appointed to inquire into the causes of the current economic crisis as well as all those involved, including officials who have neglected their responsibilities in this regard.

The COPE Chairman said that the whole country is in a huge crisis today due to the decisions of a few people who led the economy and said it should be deemed a criminal offence and action must be taken against them. 

The COPE Chairman made this recommendation when the Central Bank of Sri Lanka convened before the COPE Committee yesterday (25) to examine the Auditor General’s reports and current performance.

Asked about the root causes of the economic crisis, Central Bank Governor Dr.Nandalal Weerasinghe said that when the International Monetary Fund (IMF) was approached for a loan in 2020 March to April, they had written to Sri Lanka stating that Sri Lanka had no Debt Sustainability at the time. Therefore, the then Secretary to the Ministry of Finance and the Governor of the Central Bank had been informed in writing that the existing loans would have to be restructured in order to obtain credit facilities, he said.

Accordingly, after the relevant technical discussions under the Monetary Act, the Monetary Board of the Central Bank had recommended the relevant technical matters to the Minister of Finance and other senior officials, Dr, Weerasinghe had said, adding that the decision are taken by the Cabinet including the Finance Minister.

The then Finance Minister had never addressed Parliament and Ajith Nivard Cabraal, who was speaking in Parliament on his behalf, had not informed Parliament of this fact, said Parliamentarian Dr. Harsha de Silva.

He also pointed out that by November 2019, Sri Lanka’s debt was at a stable level, according to the IMF report, and then a few months after the presidential election, Sri Lanka’s debt was declared unsustainable, according to the IMF report.

Despite a previous IMF report advising against any tax reductions, a tax cut of Rs.600 billion was initiated with the intervention of the then Secretary to the President and Dr. de Silva asked who made the decision.

However, MP Sarath Weerasekara pointed out that this decision was taken in order to encourage new entrepreneurs.

The committee inquired about the prevailing opinion in the society regarding the loss of large sums of money due to the retention of the exchange rate in the recent past.

The Governor of the Central Bank stated that the power to do so rests with the Monetary Board.

Meanwhile, member of the Monetary Board Dr. Rani Jayamaha said that she and her former counterpart Board member Sanjeewa Jayawardena were strongly opposed to the use of Central Bank reserves to float the exchange rate. She said that their objections had been tendered in writing.

However, it was revealed that as per the opinion of three members of the Monetary Board, the exchange rate had been kept at the same level and that this was done at the behest of the then Governor of the Central Bank, Prof. W.D. Lakshman, the then Secretary to the Treasury and the appointed member, Samantha Kumarasinghe

The COPE Committee emphasized the need to give the Central Bank the power to make decisions based on accurate technicalities without the influence of outside parties.

There was also a lengthy discussion on solutions to the current crisis. The Governor of the Central Bank said that although it was difficult to obtain the required foreign exchange for the next 3-4 months, they were working towards an agreement with the International Monetary Fund and would so their best to overcome that challenge somehow.

The COPE Chairman also recommended to the Finance Ministry Secretary Mahinda Siriwardena, to discuss with the Secretary to the Ministry of Public Administration, the current economic crisis in the country and the shortage of fuel and call only a minimum number of public servants required for operations during the next three weeks.

The COPE Chairman also commended the Finance Ministry Secretary and the Central Bank Governor for their efforts in resolving the current crisis.

MPs Patali Champika Ranawaka, Rauf Hakeem, Dr. Harsha de Silva, Jagath Pushpakumara, Dr.Sarath Weerasekera, Madura Vithanage and Premnath C. Dolawatta, officials from the Auditor General’s Department and the Central Bank were also present.


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