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Impeaching the President
By Suranimala
While President Chandrika Kumaratunga upped the pressure
on the government with timely statements on the rising incidents of
violence and cost of living, Prime Minister Ranil Wickremesinghe moved
last week to address the economic crisis confronting the nation by going
public with his future plans.
Given the rising dissension among the people due to the
spiralling cost of living, the prime minister's statement was aimed at
not just highlighting the state of the economy he inherited from
President Kumaratunga, but also how he intends overcoming the crisis
while paving the way for Finance Minister K.N. Choksy to announce today
the immediate relief measures that are to be introduced to ease the cost
of living burden.
This follow-up action was deemed necessary particularly
because the public at large expect the government in office to deliver
the goods irrespective of who was responsible for the state of the
economy, hence the relief package by the finance minister to be
announced today.
Relief package
And all indications are that the relief package will pave
the way for price reductions in fuel and electricity, thereby easing
public pressure on the government.
What the UNF government hoped for early in office was to
get the peace talks started end June, enabling it to use the peace
dividend derived thereby to push the tough reforms needed to get the
economy back on track. But with that process reduced to a snail's pace
and the price increases telling on the people's purse, the full public
attention was on the economy, compelling the prime minister to take
immediate remedial measures.
It is in this backdrop, Prime Minister Wickremesinghe
came to make his address to the nation even as the president turned the
heat on, fully realising the government's delay in moving against her
has turned the tide in the PA's favour.
This, primarily due to the fact, the president will be
empowered to dissolve parliament by December thereby giving her the
opportunity of setting the political agenda thereafter, which in turn
would necessarily have the UNF permanently on its toes, not knowing when
the president will strike.
The government fully realises this danger and it is due
to this fact that the constitutional amendment to prevent the president
from dissolving parliament at the end of one year was mooted but in what
is fast becoming a hallmark of the UNF government, there is a yawning
gap between words and deeds.
And alive to this reality, the president came out
fighting last week drawing attention to the two very issues which are
sensitive to the government, lawlessness and the cost of living.
This the president did by adverting to the Tissa Devendra
Salaries Commission report expected later this month, where by all
indications public sector salary revisions will be recommended.
The president no doubt is well aware the economic
situation in the country is such, the government will be hard put to
give any salary increment at this stage notwithstanding any
recommendations Tissa Devendra may make, but that was exactly what
Kumaratunga said last week, hoping thereby to woo the public sector.
Thus, given the government's discomfiture over the issue,
President Kumaratunga played the good samaritan calling for a salary
increment to the public sector to ease the cost of living burden,
knowing fully well the prime minister will be hard put to oblige,
earning for her in the process brownie points with the people in general
and the public sector in particular.
In such a situation, come December, the government will
find it increasingly difficult to get the public service and the police
to move, them not knowing which of the two masters, legislature or the
executive will call the shots.
It is with the same objective that Kumaratunga has also
focused on the law and order situation, putting Interior Minister John
Amaratunga on notice for failing to stem the tide, once again getting
police officers to think twice before carrying out their orders for fear
of earning the wrath of a
president whose hand is being increasingly strengthened due to
government inaction.
And come December, where the power of dissolution vests
with Kumaratunga, it is the president who will be calling the shots and
rest assured the public sector will not move on any issue which will
even remotely earn the chief executive's displeasure.
In such a situation, even if the president decides to
sack a minister to send a message to the people, Prime Minister
Wickremesinghe will have little maneuverability short of calling for the
dissolution of parliament.
But even on that score, he will by then find it almost
impossible to get the support of his own members to vote for such a
resolution since it is generally accepted, no member of parliament wants
an election.
The 18th Amendment
These issues of course are not lost on the prime minister
who on Thursday met with his political affairs committee comprising
members Karu Jayasuriya, G.L. Peiris, Rauf Hakeem, Defence Minister
Tilak Marapone and UNP Chairman Malik Samarawickrema to decide whether
to introduce the 18th Amendment in July or move an impeachment against
the president before December, thereby precluding dissolution.
And at the political affairs committee it was decided to
first bring only the conscience vote by end July while proceeding to
draft impeachment papers against the president focusing primarily on the
vehicle issue and the blatant corruption in the Sri Lanka Rubber
Manufacturing and Export Corporation. Other issues including some of
President Kumaratunga's statements urging people to violence and
attempting to subvert the legal process in the Bribery Commission were
also to be dealt with.
Prime Minister Wickremesinghe having considered the
matter requested Ministers G.L. Peiris and Tilak Marapone to start
drafting papers in this regard to be forwarded to parliament in stages;
the first being the conscience vote followed by an impeachment. The
impeachment will prevent the president from dissolving parliament.
Further, Minister Marapone also called for the
impeachment of Chief Justice Sarath Silva with Minister Karu Jayasuriya
backing him up and that too was approved.
Marapone said before impeaching the president, the chief
justice should be impeached if a fair hearing is to be received.
Agreeing with this proposal, Minister Jayasuriya said
independent judicial officers have complained that it was impossible to
carry out their functions impartially with the current chief justice and
that they are penalised for upholding the highest traditions of the
judiciary.
It was thereafter agreed that action to move out the
chief justice too should be taken by end July.
Before the political affairs committee meeting on
Wednesday, at the pre cabinet meeting itself Prime Minister
Wickremesinghe, obviously having the impeachment option in mind, told
his ministers the vehicle issue involving the president should be taken
to its logical conclusion.
At the same time, he told the ministers of his plans for
the economy and the follow-up action that must be taken after his
address to the nation.
Parliament to decide
The prime minister said he will place his programme of
action before parliament and ask the legislature to decide whether they
want to burden the people or proceed with the rehabilitation of the
economy on an agreed programme of privatisation.
It is thereafter that the ministers went in for the
cabinet meeting with President Kumaratunga where the focus was once
again on questionable transactions entered into during the previous
government under the authority of Kumaratunga as finance minister.
And at last week's meeting, while the ministers expected
the vehicle issue to take precedence, it was another financial scandal
involving the Sri Lanka Rubber Manufacturing and Export Corporation that
was the talking point with President Kumaratunga once again in the
centre of controversy.
In this case, under Kumaratunga's authority, Rs.
900,340,000 had been disbursed to the corporation of which Rs.
541,167,730.63 was allegedly either misappropriated or fraudulently
disposed of according to a cabinet paper submitted by Plantations
Minister Lakshman Kiriella. The chairman of the corporation was a
confidante of the president, Sarath Wickremasinghe who had been spending
the money willy nilly even without proper board approval, at times
issuing contracts to his neighbours.
This issue came up the previous week but the president
had on that occasion said she would not have authorised the release of
the money unless there was a request from the former Plantations
Minister Ratnasiri Wickramanayake.
At that stage, Minister Kiriella had said he would look
into that aspect and revert to cabinet and it was accordingly taken up
last week, where all the sordid details surfaced with Kumaratunga unable
to hide her blushes. (See box for cabinet paper)
Something fishy
Taking up this issue, where evidence showed Kumaratunga
under her signature had authorised the release of the funds to the
corporation, Minister Kiriella said, contrary to what the president said
the previous week, there was no request for the money from the
Plantations Ministry.
While Kiriella was making his presentation, Labour
Minister Mahinda Samarasinghe observed from the documentation that sub
standard machinery for the corporation had been purchased from a company
called R.R. Navigere at a huge cost and he raised a pertinent question.
Asked Samarasinghe: "Is this the same company that
was involved in getting down the luxury vehicles for the
president?"
Replying his colleague was Minister Karunanayake who
pointed out, it was the same company that was involved in the vehicle
scandal which was responsible for the sub standard machinery deal in
question as well.
Seizing on this issue, Lands Minister Rajitha Senaratne
said the involvement of this company in Sri Lanka should be looked into
and went on to say over Rs. 100 million had been spent on the sub
standard machinery.
In needling the president on this issue, the minister's
hand was strengthened by the audit report of Ernst & Young which
stated over Rs. 54 million of the monies allocated were misused,
including incidence of fraud.
Non existent factory
Going into the details, both Ministers Samarasinghe and
Senaratne said according to the reports, millions were spent to build a
factory in Bulathsinhala but that in reality there was no such factory
in the electorate.
The prime minister himself pitched in to say there was
definitely something fishy in the deal since Rs. 120 million according
to the report has been spent only on laying a foundation stone.
Unable to answer the queries, the president said the
matter could be investigated and a report made to cabinet, which
prompted Karunanayake to query the purpose of such an exercise since the
information based on Kumaratunga's own report was already before
cabinet.
"Why don't you answer this now?" Karunanayake
asked but the president once again called for an investigation instead,
prompting Defence Minister Tilak Marapone to point out the futility of
such an exercise since all the evidence was before them.
Said the president: "I will check and come
back."
Next came the discussion on the cabinet note on the
president's luxury vehicles forwarded by Finance Minister K.N. Choksy,
which was highlighted exclusively in last week's issue of The Sunday
Leader.
At the very outset, on this issue, the president moved to
buy time stating she received the memorandum the previous week in
addition to another note that day and as such would need some time to
reply.
Said Minister Choksy, "We are waiting for a comeback
from you to finalise our report to cabinet."
Procrastination
Added Karunanayake, "There is procrastination on
your part. It is like what happened at cabinet meetings under the
previous government where everything was postponed."
Shot back the president - "I got the documents only
today."
Retorted Karunanayake - "No you got them last week.
What you got today is a supplementary document."
Appealed the president: "Give me a little more
time."
Agreeing to this request, Karunanayake said since more
time is given, the president should furnish all the details including
the certificate of origin of the cars and where they came from.
Making his own contribution at this stage was Interior
Minister John Amaratunga who said there were questions raised whether in
fact all the vehicles paid for had arrived in Sri Lanka and as such the
services of Interpol too might be required to investigate the case.
Added Karunanayake, "There is also information some
of the vehicles imported were used vehicles. You said they came from
Germany. Is that your position?"
Not realising Karunanayake may be leading the president
into a trap having all the details in his possession, Kumaratunga walked
right in.
"Yes they came from Germany and they are all brand
new. Unlike President Premadasa who imported two used bullet proof Benz
cars and paid the price of a brand new car, I have not done so. You must
start investigating from 1988."
Not satisfied with that response, needled Minister
Senaratne. "What were you doing for the last seven years
then?"
But before the president could respond chipped in
Karunanayake: "You have said two vehicles were not in working order
after the bomb explosion and are under repairs. That is not true. The
managing agents of the vehicles told me today the vehicles were repaired
and sent to you and were in your garage. In fact they said you owe them
Rs. 1.5 million."
Taken aback Kumaratunga retorted angrily: "Anyway, I
am not going to answer anymore. I am putting a full stop on this
discussion today. No fraud has taken place in the last seven
years."
While this comment sent ripples of laughter in the
cabinet room, Karunanayake pressed on.
"Whether there was fraud or not is a matter for you
to comment on and for us to decide. You are just one in a cabinet of 30
members. You can't dictate to us."
Retorted the president: "But I am the head of
cabinet."
Replied Karunanayake cooly: "That is OK but you give
us your reply next week."
Interjecting at this stage, the prime minister told the
president she should send her response to the cabinet sub committee
which would in turn submit a full report to cabinet.
With that out of the way, the ministers discussed the
developments in the east with both Ministers Rauf Hakeem and Milinda
Moragoda explaining the ground situation. Moragoda in particular said,
looking at the suffering of the people in the east, they must work
together to bring about normalcy in the area without turning it into a
political issue.
On that note the meeting ended but the battle was far
from over with the UNF ministers having set a trap for the president not
only on the vehicle issue but also on the Rubber Corporation deal, where
the same German company is a key player.
Impeachment
The thinking of the government now is to take these
issues to a logical conclusion and impeach the president.
In fact, after the cabinet meeting both Ministers Choksy
and G.L. Peiris told their colleagues sufficient material was available
on these two issues alone for an impeachment. The decision by the
Political Affairs Committee was subsequent to that.
What the president does not possibly know is that once
she comes out with her explanation, more startling evidence which has
been unearthed by UNF sleuths in the vehicle issue will be placed on
record, thereby trapping Kumaratunga in her own explanation,
paving the way for impeachment.
But Kumaratunga has also decided to take the fight to the
UNF and last week issued show cause notices on former Ministers A.H.M.
Fowzie and Richard Pathirana for speaking in support of the conscience
vote.
With that move, Kumaratunga has moved to call the
government's bluff and put her backbenchers also on notice in the event
they are also motivated to speak in support of the constitutional
amendment.
And now it is upto the UNF to prove, it has not
sacrificed the two senior members over an amendment they never intended
bringing.
That the coming weeks will tell but one certainty is that
with the sands of time fast running out for the December deadline, it is
back to battle stations.
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Kiriella's
cabinet note
Ministry of Plantation Industries
3rd July, 2002
Note to the Cabinet
Temporary advance for Sri Lanka Rubber Manufacturing
and Export Corporation Ltd
This is in reference to the Cabinet Memorandum submitted
on 8th February, 2002
I made a request to the Cabinet of Ministers that Rs. 90
million should be released to the Sri Lanka Rubber Manufacturing and
Export Corporation Ltd., from the Treasury to meet the financial
constraints faced by the said company.
The observations given by the minister of finance on the
said cabinet memorandum which says that Rs. 45 million should be
released as an advance to the said company and which was further stated
that this company will enter into an agreement with the Treasury on the
payment of Rs. 45 million and Rs. 125 million which was previously
released by the Treasury to the said company. But I have studied the
performance of the company in the previous period and discovered the
following.
It was revealed that the minister of finance has
submitted a cabinet paper on 10/01/2001 on release of Rs. 222.35 million
to Sri Lanka Rubber Manufacturing and Export Company Ltd., by the
Treasury and which was approved on 31/01/2001 (a copy of the cabinet
memorandum and decision are annexed herewith). I kindly draw your
attention that although Sri Lanka Rubber Manufacturing and Export
Corporation Ltd., is under the purview of the Ministry of Plantation
Industries, the above cabinet paper was submitted by the minister of
finance. Further, this cabinet memorandum stated that the above amount
should be given to rubber small holders in view of the reasonable price
given to them on a competitive basis.
It should be mentioned that Ministry of Plantation
Industries has not been requested to obtain a loan from the Treasury and
the Treasury on its own allocated the undermentioned amounts to Sri
Lanka Rubber Manufacturing and Export Corporation Ltd.
1999 Rs. 544.49 million, 2000 Rs. 228.85 million, 2001 Rs.
127,00 million, Total Rs. 900.34 million.
I discovered that the utilisation of the above funds was
not properly done according to the information revealed by the ministry
and the audit report issued by the auditors of Ernst & Young. Rs.
541,167, 730.63 out of Rs. 900.34 million was utilised under the
following manner according to the auditors report.
1. Duplicate payment
2. Payment has been made but not to the correct persons
3. Additional payment has been made and additional
payment made without proper approval.
4. Payment made on fraudulent calculations.
5. Payment has been made without justifications.
6. Payment has been made to wrong persons without paying
to the correct persons.
7. Persons cannot be identified to whom they made
payments.
8. Payment has been made without purchasing of goods and
services
9. Payment has been made to unconstructed buildings.
10. Rs. 151,559,234.08 was not utilised which was
released by the Treasury but not in the bank account.
11. Payment documents not available in the office
12. It has purchased machinery from a German company
called R.R. Navigere, those are not up to the standard quality.
In view of the above factors,
1. It is proposed to release Rs. 90 million to the Sri
Lanka Rubber Manufacturing and Export Corporation, by Rs. 15 million
each with six installments as stated in my Cabinet Memorandum on 8th
February, 2002.
2. It is proposed to conduct an investigation on facts
raised by the auditors report. Thereafter, other matters should be
considered.
Lakshman Kiriella
Minister of Plantation Industries
Annexures
I Cabinet Memorandum on 2001/01/10
II. Cabinet decision on 2001/01/31
III Summary audit report of Ernst & Young Co.
IV Invoices of purchase of imported machinery
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Treasury woes hound Jayasundera
By Frederica Jansz
A puzzling feature of the new United National Front (UNF)
government is why some public officials continue to hold office despite
the fact that it was the UNF which shouted foul against the conduct of
these officers.
Amazingly, some of these officers continue rubbing
shoulders with the new cabinet of ministers, grinning convincingly, as
they curry favour with the greens. And, what is more astounding is the
volte face done by the government of the UNF, who a mere six months back
were screaming themselves hoarse about transparency and accountability
and the corrupt practices of certain public officials.
One of these officers thus accused by the UNF is none
other than Dr. P. B. Jayasundera, chairman, Public Enterprises Reform
Commission (PERC).
Formerly the Finance Secretary, P. B. Jayasundera whom
the UNF accused of being the cause behind the economic mismanagement of
the previous regime continues to hold high office in this government as
well.
In his present capacity as chairman PERC, Jayasundera
though believed to be responsible to a large extent for the economic
downturn and loss of business confidence in the country, is still
holding high office.
Consumer Affairs Minister
Karunanayake is determined that Jayasundera should be removed.
Karunanayake is not alone in this view. Many leading private sector
individuals who have had to 'deal' with Jayasundera consider him to be
inconsistent and incompetent.
Incompetent
Minister Karunanayake asserting his position on the issue
said, "We have been saying that the entire government of the
People's Alliance was incompetent and corrupt over the last seven years.
An active player to this process has been the present chairman of PERC
who was then the secretary to the Treasury. This is not about
witch-hunting any individual. The fact of the matter is that P. B.
Jayasundera is incompetent and has even been implicated in the multi
million-dollar vehicles purchases by President Chandrika Kumaratunga."
Jayasundera countered that this is a matter for the
Presidential Secretariat. "The Treasury only provided the necessary
funding and allocations," he said, asserting that the relevant
spending agency has to follow government tender procedure. He said he
could not state if the Presidential Secretariat which was the spending
agency in this instance did so. "I am sure they must have
done," he reiterated. He did not say whether he ascertained this
fact before releasing millions of dollars.
He maintained that it is not the practice of the Finance
Ministry to check if indeed such procedures had been followed by the
spending agency.
He explained that the monies (amounting to millions of
dollars) was released by the Treasury following a request made by the
Presidential Secretariat. He said the Treasury complied on the basis
that additional vehicles were needed to boost presidential security,
following an assassination attempt on President Chandrika Kumaratunga in
December 1999.
Cabinet ministers in this government, namely, G. L.
Peiris, S. B. Dissanayake, Tissa Attanayake, W. J. M. Lokubandara, John
Amaratunga, Rajitha Senaratne, M. H. Mohamed and A. R. M. Cader are of
the view that Dr. P. B. Jayasundera is responsible for decisions taken
during his tenure as finance secretary that were seriously detrimental
to the economy of the country.
Economic Reforms Minister, Milinda Moragoda, however has
voiced dissent. Moragoda argues that P. B. Jayasundera should not be
ousted on political grounds. Moragoda has assured his cabinet colleagues
that if there are charges of corruption, abuse of power or impropriety
on the part of Jayasundera, he is prepared to look into them and take
action, provided there is tangible proof.
Moragoda standing firm
Standing firm by his commitment "to enact a clean
political culture," Moragoda emphasised to The Sunday Leader that
hounding public officials should not happen under the present regime
unless of course, "there is substantive evidence to prove a state
officer is indeed corrupt."
Moragoda pointed out that when in opposition, the UNP
fought against public officials being politically victimised.
As the controversy against P. B. Jayasundera smouldered
last week, with angry ministers barely concealing their animosity
towards Jayasundera, allegations were levelled against Milinda Moragoda,
claiming he is nurturing ulterior motives when speaking in defence of
the PERC chairman.
It was whispered that Moragoda's business concerns
received blessings during the tenure of Jayasundera as secretary to the
Treasury.
Moragoda scoffed at these allegations as being, "a
typical slander campaign, common in Sri Lankan politics. "This is
what I am trying so hard to change - but you can see how impossible it
seems to be, to try and bring in a new and fresh political culture that
will do away with all this pettiness, back-biting and character
assassination," he said, adding the accusations against himself are
"totally unfair and unjust. In fact my business suffered due to
victimisation and I even had to go to court," he said.
Whatever the differing points of view on Jayasundera
between Moragoda and his cabinet colleagues, in the public sector, many
senior bureaucrats despise him (Jayasundera) for his lack of consistency
and above all his reputation of selling-out his colleagues in order to
achieve his own ambitions. It is well accepted in the public sector that
he openly criticises and makes life difficult for anybody with access to
the president on matters relating to economic affairs of the country. P.
B. Jayasundera, they say is totally incapable of teamwork.
Unsuitable
According to leading private sector personalities, they
cannot remember any previous treasury secretary who was as unpopular and
unsuitable for his job as P. B. Jayasundera. They claim it is not his
lack of knowledge that makes him unsuitable for his post, but his
inconsistency and unreliability.
The private sector cites several examples of his
inconsistency.
(a) Talking of the need for fiscal prudence on the one
hand and justifying the recent economic relief package of the People's
Alliance as not being politically motivated.
(b) Reducing indirect taxes on beer to promote investment
and assuring investors that excise taxes won't be raised. However,
within one year after local and foreign investors poured in billions of
rupees to build new plants, Jayasundera increased the very tax he
promised not to raise.
Jaysundera responded to these allegations asserting that
in the first place these decisions are not taken by him, alone.
"There is a consultative process," he said. Referring to the
increased taxation on beer, he reiterated that yet the taxes on beer are
maintained in neutral terms with the GST. Jayasundera admitted that as a
result the tax base may have changed by 2 or 3% but that in comparison
to the taxes imposed on liquor and tobacco, the taxes on beer is
maintained at a low level.
The private sector claims that despite numerous
complaints about Jayasundera's poor showing - to the president, she
maintains that his unpopularity in the private sector is due to the fact
that he does not grant special favours to a selected few in the manner
the treasury secretary of the UNP regime did. The private sector totally
rejects this argument.
According to the private sector, the problem with
Jayasundera is not the fact that he says no. Businessmen say that they
do not mind if he says no upfront on the basis of a certain policy
decision he wishes to follow. The problem however is that he says one
thing to the private sector and does something else. The problem lies in
his inconsistency and the fact that his word cannot be trusted, they
say.
In addition to the case on beer, another indigenous
company (Laugfs - Auto Gas Lanka) sought to import and distribute gas in
competition with Shell. On the basis of a verbal and written undertaking
given by Jayasundera, this company invested tens of millions of rupees
to set up a gas distribution facility. Later, Jayasundera went back on
his word. In desperation, after failing to get even an appointment with
Jayasundera for several months, this company managed to obtain an
appointment with the president who directed Jayasundera to keep to his
word.
Jayasundera countered this allegation asserting that a
detailed report had been prepared by the Fiinance Ministry at the time
on this case but that it was the Power and Energy Ministry which had
stood firm and insisted they did not want to enter into an agreement
with CPC and Laugfs. Jayasundera maintained that while certain ministers
of the previous regime were in favour of Laugfs, others, namely former
Power and Energy Minister Anuruddha Ratwatte was not. In fact, Ratwatte,
had by this time already begun negotiations with Petronas in Malaysia,
Jayasundera said.
Another allegation levelled against P.B. Jayasundera is
that he is known to bend over backwards to help one or two of his
favourites. Among his firm favourites is Ken Balendra. On the basis of a
recommendation made by Balendra himself, Jayasundera, they claim,
introduced an amendment to the Inland Revenue Act to grant investment
relief to companies investing large amounts of money on 'infrastructure'
projects. This amendment was introduced perfectly timed to enable John
Keells Holdings to benefit from millions of rupees of income tax relief
on account of its investment in the P&O project.
Jayasundera strongly refuted this allegation. He said,
"if you check when this investment relief was discussed at the
National Development Bank under the chairmanship of Dr. Lal Jayawardena
- I and Dr. Jayanethi are the people who argued that any tax relief or
tax holidays is not the right way to reform taxation. I can
categorically say I did not work with any person in the private or
public sector to favour any one individual. My whole commitment has been
made to create a level playing field. Unfortunately in that process many
people got hurt - but it was not targeted at any individual or any
individual benefits. It was just to favour private sector led
development in the country."
Does not heed advise
The private sector claims that despite P. B.
Jayasundera's theoretical knowledge, due to a lack of practical skills
and not taking the advise of his colleagues in government, Jayasundera
has been responsible for the government entering into many agreements
unfavourable to the country.
For example, the privatisation of Airlanka, Shell Gas and
Sri Lanka Telecom are among the few disastrous deals P. B. Jayasundera
concluded. The fact that he likes to work only with the president,
bypassing even the cabinet and the board of directors of PERC, is
exemplified in the way that Airlanka was privatised. The details of the
privatisation transaction was placed before the cabinet and the board of
PERC days before signing the deal, without giving any time for studying
the details or raise points of concern. In the case of Airlanka, the
PERC board was directed to rubber stamp the deal in one day.
Jayasundera had this to say when asked about this
allegation. "We have given our side of the story at the COPE
meeting. The privatisation of Shell was done by Rajan Asirwathan - even
the Airlanka transaction was initiated when he was the chairman of PERC
and Arittha Wikramanayake and Chandra Jayaratne were all on the board of
PERC. The entire board at PERC were kept briefed about the transactions
involving the sale of Airlanka shares to Emirates Airlines. I have never
interfered with their work during my capacity as finance secretary or
had any individual discussion with anybody on these transactions. With
regard to the Airlanka transaction, President Kumaratunga together with
the Finance Ministry discussed the various issues several times. It was
not concluded in a day and it is very unfair to make this
allegation".
In addition to the above, angry businessmen say
Jayasundera squandered billions of rupees that the state could have
obtained by failing to dispose of the remaining 60% stake in Sri Lanka
Telecom in time. He decided to hire Hong Kong Banking Corporation (HSBC)
as the general advisor to dispose of these shares, when this company
hardly had any experience in placing telecom shares internationally and
there were more qualified companies that had expressed interest, the
businessmen alleged. HSBC failed to
find a buyer for these shares and since then the value of SLT shares
have fallen next to nothing, primarily due to the recent decline in
appetite for telecom stocks internationally. The revenue lost to the
state as a result of mis-handling the sale of the remaining SLT shares
is a staggering Rs. 20,000 million!
Jayasundera reiterated that he had no involvement in the
selection of HSBC in this instance. "It was done by a technical
panel and based on that ranking, the panel selected HSBC and went to
cabinet for approval. We only wanted to select a reputed investment
banker," he said.
Another case where it is alleged that P.B. Jayasundera
has deprived the state billions of rupees in revenue, is the manner in
which the Colombo-Katunayake road project was awarded to Keangnam. whose
go between was president's buddy, Ronnie Pieris.
Bowing to pressure
Bowing to pressure by President Chandrika Kumaratunga,
Jayasundera it is claimed, changed the tender conditions of this project
midstream to do away with the financing package. This was done to help
Keangnam and by extension Ronnie Pieris.
His decision to fund this project out of the consolidated
fund means that the state would have to cough up Rs. 10 billion or more
in cash at a huge opportunity cost when there were other reputed
international bidders for this project who were in a position to offer
cash grants on a government to government basis.
"I deny this charge too," Jayasundera said. He
asserted there had been a tender board chaired by Daya Liyanage -
"I took over this tender board after Daya Liyanage left for
Malaysia. These charges are now being investigated - I am waiting to see
if anything has gone wrong on my part individually. However, I was only
the chairman of this board where there were two other members as
well," he said.
It is alleged that P. B. Jayasundera is responsible for
the president losing the services of many competent persons who dared
stand in his way of his attaining the post of secretary to the Treasury
and ensuring that no one else has access to her to point out his
shortcomings.
The officials who were caught up in his machinations
included:
(a) A.S. Jayawardena: kicked upstairs from Treasury
secretary to governor of the Central Bank
(b) B.C. Perera: appointment terminated due to a series
of disputes with Jayasundera
(c) Dixon Nilaweera: who many in the Treasury say was the
best Treasury secretary of the CBK regime. His contract was not extended
by Kumaratunga due to tales carried by Jayasundera.
(d) Rajan Asirwatham: resigned in disgust as chairman
PERC due to differences of opinion with Jayasundera.
(e) Dr. Lal Jayawardena, former economic adviser to the
president: A reason for his bout of ill-health while in government was
primarily on account of stress caused by Jayasundera blocking his access
to the president and total disregard to his point of view. Jayewardene
is Minister Moragoda's maternal uncle.
It is reliably understood that if many of Jayawardena's
recommendations had been implemented, the economy would not be in such
dire straits. Eventually, in disgust, Jayawardena accepted an
appointment as High Commissioner to the UK, thus depriving the CBK
administration of his abilities as an eminent economist.
(f) Chandra Jayaratne, former board member of PERC
resigned also due to differences of opinion with Jayasundera. Even
today, due to this grudge, Jayasundera is not too receptive towards him
in his capacity as chairman of the Chamber of Commerce.
(g) Thilan Wijesinghe, former Chairman BOI: It has
emerged from court records that the written complaint against Thilan to
the Bribery Commission was not made by the accuser, Ranjith Athukorale,
but by Jayasundera without calling for explanations from Thilan.
According to a senior Treasury official this action is unprecedented and
unbecoming of the Treasury secretary and carried out because he couldn't
"control Thilan's access to the president".
Jayasundera denied he had anything to do with the
complaint made to the Bribery Commission against Thilan Wijesinghe.
"I had nothing to with that," he said, adding that the other
names mentioned are all his very good friends and remain so.
Jayasundera said he is frustrated and hurt that he is
being targeted at this juncture. He reiterated that he has not done
anything wrong but only given his professional best, working with
commitment towards the economic betterment of this country.
He asserted that in the event it is proved he has not
performed in a manner truly professional - "then I should not stay
- I will go."
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