President has decided to harass me continually
Former President Chandrika Kumaratunga
You can love her or you can hate her but no one can deny that Chandrika Bandaranaike Kumaratunga is a fighter, and a no holds barred one at that.
And it is this fighting spirit that came out strongly in an exclusive interview with The Sunday Leader on Friday (10) where the former President spoke of her new role as an advisor to UNESCO, the political mistakes made during her tenure as Executive President, the security concerns she has and generally on men and matters.
The interview was conducted at Kumaratunga's official residence which contrary to popular belief was an old, dilapidated house down Independence Avenue with cracked walls, peeling paint, broken windows and a leaky roof. Repairs of course were underway to make the house habitable and the former President was apologetic at the
conditions under which the interview had to be conducted and was to question whether the house fitted the definition of a 'luxurious mansion' as made out in some quarters.
More striking was the hastily put up cardboard shack which housed the armoury with the toilet at the back too doubling up as a store house for the weapons. The security personnel of the former President had to make do with a small room into which about 10 bunk beds were cramped in. It appeared that Kumaratunga was getting a
dose of the third degree treatment from the powers that be and was possibly why she spoke passionately about the lack of security and the threat to her life.
Time and space did not permit The Sunday Leader to deal with all the issues exhaustively but rest assured there will come another day and another time to conclude this unfinished story of a political enigma of our times.
Following are excerpts of the interview, the first since Kumaratunga relinquished office:
Frontal view of the official residence and The armoury at the former Presidentís official residence
By Lasantha Wickrematunge
Q: You have just returned to Sri Lanka after a long stint overseas. You have also accepted a new posting as an advisor to UNESCO. What does your new role entail?
A: Well you see when you are a consultant anywhere, it is a very easy and interesting job. But for people like me who like a hands on job and like to see results very fast it is not a highly satisfying job. There are six governments other than Sri Lanka in the SAARC region and I cannot go and boss them like when I was President in this country.
Basically I have to work with the education people but in most countries, the heads of government were very happy. When I retired I was the most senior head of state in the whole region. Therefore they have a lot of respect and affection for me.
I had to understand first and foremost that most of my role was to work with them and under them. I met the prime ministers and presidents and told them this is what I am supposed to do. My main role is actually to promote the timely achievement of the Millennium Development Goals. It started in 2001 and we are supposed to achieve all the goals by 2015.
There are major areas such as education, health, poverty alleviation, good governance and environment. I am supposed to push the Millennium Development Goals for education only and make sure that the goals are achieved. It is a bit difficult. I have transform my personality for this role.
During my term as President if someone from the government did not do what I had said needed to be done, I used to go and do it myself. That is why I used to work till 11 or 12 in the night and get late because I was doing a thousand things at the same time. When ministers did not work, I told them once or twice and then could not be
bothered wasting my time anymore, so I went ahead and did it. But of course I allowed them to take the credit.
Here I cannot do any of that. One of my passions has been education.
Q: How did you adjust to this new role?
A: I cannot tell you that because I just started. I have to adjust to many things. However, we were talking about my retirement, there is so much said about my retirement. I do not know whether you will believe this, but my two children, few of my close friends and my sister know it. In 1994 when I contested for the presidency my children were dead against it. They were against me contesting for the chief
ministership because they said their father was killed and their mother would be killed very soon too. And they both begged me not to.
However I told them that I would not go for the premiership because I thought my mother or Anura or some other leader of the party could do it. But then everything changed and there was no one else. Ofcouse I have to say that I liked the idea, not of the position, but of doing a thorough job of work because I have always got a lot of pleasure doing things well. And also in the Sri Lankan situation, there were a very
few politicians who could manage government at the time. I told my children that I would give up all political positions after two presidential terms.
My plan was to spend one or two years in the party and strengthen the party. But I did not make this public because my people would have been desperate asking me not to go.
Q: How would you assess the performance of President Mahinda Rajapakse's government one year after his election?
A: I don't want to comment on that. I was President of this country for nearly 12 years. Almost all the ministers of today were brought into office by me after 17 years in the opposition. They were losing election after election. At the risk of my life I changed that trend. I built up the party, achieved a lot of things honestly and
sincerely and handed it over to them, now it is upto them to carry on and deliver to the people.
I have my views on the performance of the government, they are strong views. I am writing about it. When this government stops being viciously vindictive towards me I will publish it. I am very worried about the state of the country, that is all I can say.
Q: How do you see the current developments with regards to the resolution of the ethnic conflict considering the initiatives you launched in 1994?
A: Well I think we are on a completely different agenda. This is what I told the President after I made him my candidate for the presidential election. I told him he is making a big mistake by giving too much place to the extremists, namely the JVP and JHU at that time. Altogether, they accounted for less than 5% of the vote at that time.
When the election was announced, I told him to make alliances if he wanted to with extremists though I would not have, but not give them too much prominence. I marginalised all the southern extremists politically during my time and I was in the process of doing it in the north when my term came to an abrupt end.
I locked up the southern extremists in a cupboard, politically speaking. This is why the extremists of all types hate me and have been party to President Rajapakse's attitudes towards me. Mahinda took them out and dusted them and put them back in circulation.
I told him not to do it since he would face many problems in resolving the issues confronting the country. I told him he will never be able to solve the ethnic issue politically since they want a military solution. I said the question cannot be resolved militarily by both sides and that the next time the LTTE will not confine the war to the north and east but bring it to Colombo as well. Not with arms but with bombs
and suicide bombers and I told him to be careful of allowing such a situation to develop.
But he changed everything the SLFP and PA stood for and turned the clock way back beyond 1956 on all the progressive steps taken. Therefore, I told him I cannot talk about the ethnic issue but that I would help him in other spheres. I told him I led 13 campaigns for the SLFP and PA and won 11 of them and that I will do what I can to make him win.
He had told some ministers that I was working to defeat him. Then I told him I am not like those who worked to defeat Hector Kobbekaduwa in 1982. It was Mahinda Rajapakse and people who worked to defeat Kobbekaduwa. I said such tactics are not in my blood and that I won't interfere with the campaign he and his brother Basil were planning but I said to map out a campaign plan as I always do and tell me what my role
should be and I would do my best for him after discussing what can be done and what cannot be done.
I asked Mahinda, seven times during the first six weeks after I nominated him for the campaign plan, in the presence of several others and he kept saying it will be given the next day, the following week etc. but never gave it. Finally I had to leave for the UN and thought I will look into it when I get back. Then I prepared my own meeting schedule.
Until I went to address the meeting in Kurunegala half the people of the party had not come out thinking there was a conflict between me and Mahinda. I had doubts about Mahinda's sincerity but because he said he has changed, I believed him and gave him the chance.
Q: The SLFP had an image of being a Sinhala-Buddhist nationalist party until you changed course in 1992 and gave the party a more liberal image. Are you disappointed that the party has now once again embraced the old thinking?
A: I am horrified and devastated. That is because the SLFP has safeguarded democracy in this country. It is true Lasantha that without the SLFP there would be no democracy in this country. Do you know that the SLFP is the only party that has not taken arms even under the gravest pressure? Not because we are cowards but that has been the party philosophy. After what J.R. Jayewardene and Ranasinghe Premadasadid
to this country, there would have been no democracy in this country if not for the SLFP.
Therefore as a democratic party, as an enlightened party, I think I brought in a new enlightenment to the party and everyone fell in line with it except a handful. I cannot see any enlightenment in the party now. I cannot see a vision or direction at all.
Q: Do you regret aligning with the JVP in 2004 which would have propelled this process in a way?
A: Quite definitely
Q: Would you say that is the single biggest mistake you made in your political career?
A: No. The single biggest mistake I made will reverberate for generations and which is relevant at this very moment I cannot speak about now. But, yes the alliance with the JVP was also a big mistake.
After I was bombed, there were three serious mistakes made which I regret. That is not because I was bombed but because I have not given myself time to recover and I took decisions which under normal circumstances Chandrika Bandaranaike Kumaratunga would not have taken. Whilst I dare say, I have revolutionised many aspects of government and our society for the better, I have made some mistakes. Not alone but with my
party behind me.
Q: What are the three biggest mistakes you speak of?
A: For that you will have to wait for my autobiography.
Q: But is the alliance with the JVP one of them?
A: Yes, definitely. I will also tell you the second one. That is the dissolution of parliament in 2004. I refused point blank to do it. The final day before signing with the JVP also I said don't expect me to dissolve parliament, I won't do it. It was entirely my responsibility as the Executive President.
Lakshman Kadirgamar who was like an elder brother to me told me, 'Chandrika please realise it is very lonely up there and you are alone when you take this decision.' I said, yes I do realise that. It is on the exclusive authority of the president that I took that decision. It was wrong. I shouldered the entire responsibility for it and took all the blame. Mahinda did not help at all during all of this. Yet he stood
to gain most.
It was the JVP and those in my party who were keen to win the elections and take office who pushed me to dissolve. I did not do it for power for myself since I was still the Executive President and had all the power I wanted to do my job for the country.
I regret those two decisions at that time. The only thing that tilted my decision was again my humane attitude towards people. Our people came and said I was ok because I was the President with full security whilst they suffered without housing, jobs, faced harassment and politically motivated litigation.
Q: How do you see a person like Mangala Samaraweera surviving in this set up having defended you?
A: I don't want to comment on that. Mangala is a friend and will be whether he is in politics or not. I have respect for his ability and political savvy and sincerity of purpose - rare qualities in today's politicos!
Q: The government has just banned a radio service on the basis of protecting the country's culture. Do you see a cultural re-awakening in the country?
A: Suffice it to say for now that all this is done on the basis of individual whims without any consistency. Now there is a book published in absolute filth about me going so far as to say that I a former President orchestrated the bomb attack on myself. Now that book was not banned. If they could have banned the Da Vinci Code from cinemas in Sri Lanka, I am going to write to the President and ask why this
book was not banned. In fact I wrote to the President today (Friday).
Q: You said at one point that your passion was to go overseas and do window shopping. You now have the opportunity to do that but are security constraints preventing you from doing that?
A: I have not been given any security. I am alone in London. I also said I just walk on the streets of Paris or London but ofcourse Paris is much more beautiful. I am a person who can sit on the beach and stare at the sea for hours. I can also sit and look at a tree for hours. I also attended painting classes because I love art and sculpture. I also love reading and writing and I love making good and sincere
friends because a sincere relationship is very important. I love spending time with my friends, sitting and chatting over a glass of wine.
As you can see I also love the theatre because I used to act those days. Actually mentally I was well prepared for retirement because I have sufficient interest in life apart from political power. But ofcourse it was in the back of my mind that I was going to rest for one year because I was mentally and spiritually tired and thereafter at
the end of one year or so start looking for an international assignment like the one I have got because I knew that being the kind of busy body I am, all these other things would only be past times.
I needed a purpose in life and that purpose was definitely not going to be in Sri Lanka but it would be elsewhere. I also never wanted to take anything full time although I was offered some full time jobs in the UN. I said no to it because although I know it is very good for my ego in the next 15 to 20 years of life I have left, there are a lot of things I need to get done.
Q: But 61 years is a relatively young age for a politician if you look at the political spectrum...
A: Well Mahinda has taken over at the age that I retired, after 12 years in the presidency.
Q: Exactly. Now talking about retirement, some might have described you as an iron lady during your presidency - you were controversial in some areas. But people would have thought that once you retire, your era would end. But you continued to be in the storm of an eye on various issues from your security as well as the various
allegations of extravagant living at state expense. How do you respond to those charges?
A: As I told you, I now want to retire. I have retired and I do not want to have an active political life. I want to do what I told you and most of it I have achieved. I have also achieved what I have wanted to achieve outside Sri Lanka. But retirement is difficult. My plan was that I would come back and live in Sri Lanka.
However I wanted to get out for one year to cut the umbilical cord because if anything went wrong in the party, they would come running to me saying ane madam. Thereafter I had decided to base myself here and go out for any assignments and go out to see my friends and spend a couple of months every year abroad with my children.
They are both well employed so they can afford to keep me. I haven't still accessed those stacks of millions that I am supposed to be hiding away! But now the most unfortunate thing in my retirement is that I am not allowed to live in peace in my country. I thought I could live here and be happy.
The main reason is that for some reason President Mahinda Rajapakse has decided to harass me continually. I asked him at the first central committee meeting of the party we had just after I retired if Chandrika Kumaratunga is his worst enemy even more than Pirapaharan. I am going to write a socio political analysis of the Rajapakse family's attitude towards the Bandaranaike's as a political scientist. I have been
agonizing trying to understand Mahinda's hatred of me. From the day I named him as the party's presidential candidate on July 26 last year, that evening he went and started attacking me in a speech made in English.
I asked him what this was all about and he said he only read what was written by someone else.
As for my security - it has been dangerously jeopardised by the defence authorities. I'd like to enumerate the facts briefly:
The high Level Committee on Presidential/VIP security recommended that I should have a force of 250 personnel and the relevant number of vehicles and so on. I cut the numbers down to 150, plus the admin. personnel amounting to about 18.
This was approved by cabinet. The paper was presented by Hon. Ratnasiri Wickremanayake as Deputy Defence Minister then, and obtained unanimous approval. I did not attend the meeting.
One of first 'noble' acts the new President did as head of cabinet was to withdraw that cabinet approval. This was nearly an year ago. To this date no formal approval has been given for CBK's security. My security personnel are fearful of this situation and feel insecure - very bad for efficient security.
Then a fair number of commandos in my security were withdrawn when I informed the President that I would return to Colombo mid-January this year. The day after I returned a further group of 10 were asked to report back to the army. I asked them not to and met the President about this and one other issue about the BMICH board. The President assured me he would resolve both problems and requested me to contact his
Secretary Lalith Weeratunga in two days. When I called the latter, he greeted me and put the telephone down. My office tried in vain to contact him that entire day.
Thereupon I wrote to the President about the security issue and sent copies of the letter to cabinet ministers and all MPs of the PA and the SLFP of which I was the leader. I have had no response upto date, apart from an abusive telephone call from the President on the morning of February 17, furious that I had bared the truth about the
manner in which he was harassing me and jeopardising my security arrangements.
Mahinda then told me I was giving Lasantha (you) all the information, to which I responded that it was you who for 13 years had given him information and blasted me through his paper.
Seven months passed without much excitement until the media began to announce my return to the island.
Instructions came promptly to withdraw a large number of commandos, leaving me with a contingent that is only 1/4 that which was assigned to Mahinda Rajapakse when he was Leader of the Opposition who had no threat to his life.
In the meantime the President's Secretary insisted on all three of the security vehicles I was given to be returned. We sent back two and kept one despite repeated requests to return that one too.
I was refused security in London by our government except for one month on the grounds that the government had no money to pay the subsistence for one officer. We then requested that one officer be given duty leave to remain in London, without subsistence. This too was turned down by the Defence Minister.
But I learn from your newspaper that there appears to be sufficient funds for 71 persons to be lodged in six star hotels entertained, with a mobile telephone assigned to each one in New York this year, to be bystanders at the UNGA.
Now the Defence Secretary - brother Gotabhaya has 'ordered' my security director to be taken to the CID and interrogated twice - on the allegation that he did not give me proper security on October 30, when I arrived at the Bandaranaike International Airport from London.
The SSP looking after my security is accomplishing a near impossible task under the above circumstances. I had to handle my security arrangements alone in London, attend to my tickets, travel to the airport discreetly for security reasons - all operations normally handled by my trained security personnel.
I had mistakenly informed my Director/Security that I was due at the Bandaranaike International Airport at 11 a.m, but the plane actually landed there three hours earlier. The limited security I am given only permits a discreet 'deception' operation, where the minimum number of persons are informed of the VIP's movements. Therefore the security were assembled at my official residence from 7 a.m to depart for the
airport just in time to pick me up, so as not to alert any unwanted persons. But as I arrived earlier than expected they were not present.
Now this has been made the excuse to harass and intimidate the head of my security. The President who by numerous wilful acts of commission and omission, that I described just now, has dangerously put my safety in jeopardy, now makes a huge shindig about the airport incident.
I wish to say that this happened entirely because I was denied the minimal security requirement in London and during my travels which could definitely have prevented this mistake on my part, as I was overwhelmed with packing and moving out of my apartment the day before I emplaned to Colombo and with several personal problems that needed my attention before departure.
The finger of accusation should not be pointed at my security people but at those who are in the process of rendering defunct the proper and satisfactory functioning of my security.
All this is done while the security establishment of the government has officially reported in March and June of this year that CBK is still under grave threat to her life from the LTTE and should be accorded maximum security.
All that happened was that explanations were called from the officials concerned with doing the threat assessment report, as to why this report was made and why it was sent to my security division.
Maithripala Sirisena was the acting minister some weeks ago and has made a statement that it was because I was not in the country that they were reducing my security and that my security would be given once I came back to the country. It has now been 11 days since I set foot in this country.
The day after I returned we wrote to Gotabhaya Rajapakse requesting that he restores the 30 commandos that were taken from time to time and the security vehicles which were withdrawn. That was 10 days ago. We haven't even had the courtesy of a reply. I have to borrow security vehicles from Anura Bandaranaike from time to time.
Once you give vehicles to a retired VIP you cannot take it back. Just because J.R. Jayewardene died, the vehicles were not taken away from his wife. Instead she was given new vehicles. Now the President has given two new vehicles to D.B. Wijetunga who is paralysed in bed. But my vehicles are withdrawn. What justice!
My letters are not replied by Gotabhaya Rajapakse. The letter I handed over personally to Mahinda Rajapakse is not replied. Under these circumstances what am I to think Mr. Editor? Today they have killed Raviraj in Narahenpita. The only thing I can think therefore is that this government consciously and wilfully wishes to weaken my security. What else am I to think?
Q: Do you feel that it is the case because they fear that you will make a comeback to politics?
A: God only knows. Being a political analyst, I try to understand and analyse situations. I have done no harm to Mahinda. He created huge trouble in the SLFP in the 1980s opposing my mother's leadership - which kept the party out of power for 17 years. Mahinda was only an MP until I led the PA to power in 1994. I gave a cabinet ministry to His Excellency.
The country was terribly divided and fractured in 1994.
I thought my main role was to bring all these feuding factions together as people were all wounded by Premadasa's terror, JVP's terror and the LTTE's terror. I wanted to give them back their backbone so that they could work with dignity without fear and develop this country again.
In the 1994 general election, we won 83% of the electorates in this country. But we had a majority of only one seat because of J.R. Jayewardene's system. Mahinda came from the second smallest district in the country. The Hambantota District was not important in that even if we lost all four seats in the district, we would still have won.
However whatever it is I thought of Mahinda's father and his uncle, D.M. Rajapakse, Nirupama's grand father and the Hambantota people who had respect for us. Mahinda was a senior MP in the party. Mahinda thanked me and told me that he did not think that I would take him into the cabinet because of the problems we had. I told him that there were no problems on my side and it was he who seemed to have problems with all
the Bandaranaikes. I told him to put the past behind us and not to indulge in conspiring against our party anymore.
But he is the one Minister who never ever supported me on any of the government's special programmes.
He did not help with the Sudu Nelum movement which was aimed at convincing the people on the importance of a negotiated settlement. He did not permit the Sudu Nelum in his district. When I came in, I got one of the best French companies, SOFRES, to do a survey.
It was one of the best survey companies in Europe. At that time 70% of the people were Sinhala-Buddhist in the country and only 23% wanted a negotiated settlement. At that time I held a lot of workshops in the country on leadership skills. Within two years I got SOFRES back in the country and got many surveys conducted as to how popular the government policies were, how popular I was, how popular the ministers were
By the time the second survey was done in November 1996, over 68% were in favour of a negotiated settlement.
Q: There were also allegations apart from issues relating to your security that you were living in luxury and recently you had gone and bought curtains for some 12,000 and paid in cash. How do you respond to those charges?
A: I have already sent the corrections to the Sunday Lakbima. I have already consulted legal opinion and I am going to courts if they do not publish it. They quoted the Asian Tribune but even quoting them ( you know all about the law of defamation), they cannot publish it like that. I have also written to the Asian Tribune.
I have not stepped into BrentCross for many years and after cracking my brains I finally remembered that the last time I was there was in 1993.
Another thing is that since 1990 I have not bought even a piece of material in the whole of the UK. This year as I had to live in London I bought some clothes. If I had 12,000 to pay cash, I would love it and wouldn't have given up my flat recently.
Q: Going back to the earlier question about your disappointments, are you disappointed with some of the people you nurtured and developed and gave them ministries and so on who are now trying to keep a distance from you out of fear?
A: Yes I am very disappointed. As I told you, I believe in the great goodness of man. I came into politics because of that. I was quite happy in England and I was not going to come back for years and even if I did return I just wanted to do all the things I had planned to do after my retirement. I came in only because they forced me to and the country was in such a bad state during Mr. Premadasa's time.
Do you know I came back here for a month, leaving my two children in London to ascertain for myself if I could help someone in the SLFP against the UNP regime at that time? Only if my party could not handle it would I return to take on more responsibility. I looked around and there was no one. I thought a lot again and came back to the country only because I care for the people in this country.
There was also a specific matter which I told you about. That is that we took away a lot of the leading young chaps in the SLFP. They came to London saying that it was because of me and Vijay that they had left the party and now that Vijay had been assassinated why is it that I had abandoned them? So I decided at that time that I would get back together with the SLFP and help these people.
After doing all this, I at least expected them to be humane in their dealings with me. For most people in government today politics has become a business. I have said this publicly even when I was President.
However when Mahinda Rajapakse tried to sack me as party leader on my birthday, this is the lowest and cheapest thing anyone can ever do. Only a few people dared to say this was wrong for fear of losing their highly privileged jobs. But they contacted me secretly to say how sorry they were. This does not augur well for our country when those who are supposed to be leaders behave like this.
Q: But Mangala Samaraweera stood by you at that time?
A: Mangala stood by me, my brother stood by me, Jeyaraj Fernandopulle who I did not expect to stood by me. Some people rang me up and said they will not go to the meeting. Others told me that they were forced to vote to remove me from the presidency.
However I am disappointed because the main reason I came to politics was to re-humanize politics in this country. That is why I take education so seriously because the only way to humanize youth is through education. Youth have to be taught values and ethics. But I know the people of this country have a deep appreciation of all the work I and my governments did for them. This is my reward. It is the politicos who are
willing to throw away all morality for personal gain.
Q: Many more are the questions that need to be asked but constraints of space and time do not permit us to do so now but could we continue this dialogue on a later date?
A: Yes, of course.
'No significant increase in defence budget'
Minister Ranjith Siyambalapitiya
Deputy Finance Minister Ranjith Siyambalapitiya says that the government has not significantly increased the defence budget and vows that the minor increase is not a sign of preparing for war. "A large number of people have been employed in the security forces and the increase in the allocation for defence is based on
cadre salaries. The increase is in no way a sign of the government preparing for war," he told The Sunday Leader in an interview. Siyambalapitiya is also hopeful of containing the budget deficit at 7% this year and 5% next year. He also observed that amidst all issues, the country's economy had fared well and infact grown in certain areas and attributed the rising cost of living to issues that were out of the government's control. Siyambalapitiya
noted that the forthcoming budget would not see any curtailment of relief offered to the people and that there would be no imposition of new taxes.
Following are excerpts:
By Mandana Ismail Abeywickrema
Q: Given the government's commitment to peace and finding a negotiated settlement, how could you justify the 40% increase in the country's defence budget?
A: The defence budget would not be increased by 40%. The remaining salary increments proposed in 2006 for all public servants has to be granted in 2007. A large number of people have been employed in the security forces and the increase in the allocation for defence is based on cadre salaries. The increase is in no way a sign of the government preparing for war.
Q: How would this increase in expenditure, impact the country's overall economy?
A: First and foremost, defence expenditure will not be increased. There has been no increase in war expenditure. As I said earlier, there are over a million public sector employees in the country and half of the salary increments proposed in the 2006 budget would only be increased in 2007, so that has been included in the budget. The increase that you see in defence expenditure today is the money allocated for
the increments in salaries of security forces personnel.
There is an easier way to look at it. When you look at the expenses and if we see an increase in expenditure, we have to look at it as a percentage of the country's GDP. If the defence expenditure has increased, then it should be looked as a percentage against the GDP. When you look at it that way, there has been no such increase in defence expenditure. So the only increase in defence expenditure is with regard to
the salaries of the forces personnel.
Q: Besides these increasing payments, the government has to now spend more on social welfare given the growing humanitarian crisis. How does the government plan to address it in the forthcoming budget?
A: We have several ministries looking in to these issues. Issues related to the displaced persons are looked into by the Resettlement Ministry and we will definitely allocate funds for the purpose. It could happen due to man-made reasons as well as due to natural causes, so we are prepared to face such situations. It is nothing new and it is not an eventuality brought about by the country's security situation.
That is something any country would have to do. We have a good example to learn from - the tsunami devastation in 2004. That is why we now have several ministries to address such eventualities - the Rehabilitation Ministry and the Disaster Management Ministry.
Q: With increasing war-like conditions, the cost of living has also gone up. What relief would the forthcoming budget offer to the ordinary citizens and public servants?
A: We are a government which has made every effort to shield the masses from the rising cost of living. When the cost of living increases, there are certain areas the government can control and there are also areas that the government has no control.For example, the rising global oil prices this year is one problem. I would not say that the rising cost of living is solely due to it, but it is one contributory
Other essential items too have seen an increase in prices. The price of sugar saw a 50% increase in the global market. The price of flour also saw an increase, etc. The government has no control over such matters, but the only thing we can do as a government is to reduce the import duties on such items to maintain market prices.
The government did that. The next step the government could take is to increase a person's earnings. We have taken steps to increase the income of every person - the farmer, Samurdhi recipient and even the unemployed graduates who were employed by the government. Another step taken by the government is the subsidy scheme. Farmers have been given a fertiliser subsidy. People have been provided with relief measures
like that. The government has also looked at other avenues, like taking steps to control extra profits made by the private sector. It is not a total solution, but it is a relief measure.
We have a programme called Lak Sathosa. We have done all these and will continue such programmes in the future as well. As a government, we will try our best to help the people face the rising cost of living. The government has taken steps to reduce most of its expenses to help the people.
For this year alone, the government has spent Rs. 9,000 million on fuel subsidies to shield the masses from the rising cost of fuel. In the future as well, we as a government will take every measure to provide relief to the masses.
Q: How does the government plan to bridge the budget deficit? Will there be an increase in the defence levy or will there be new tax regimes that would be proposed?
A: We are hoping to keep it at 5% and have no intension of passing on any burden to the public. For this year we might be able to contain the deficit at 7% even after incurring unexpected expenses. The government has no intension of introducing new taxes, but we plan to make it more streamlined. We see a lot of problems related to the present tax regime, especially issues faced by the taxpayers.
The taxpayers are faced with poor facilities when it comes to paying taxes. For example, if you take the tax department here, a person who comes to pay taxes doesn't even have a place to park his vehicle and has to make the payment by standing in a queue. We are looking at changing it. A taxpayer is an important citizen in the country and we have to treat them like that. We are going to open a special office in the
former Sathosa building down Jawatte Road for taxpayers to make their payments without facing any inconvenience. That is how we plan to increase our revenue targets.
Q: With the increasing war conditions there have been travel advisories issued against travelling to Sri Lanka and there has been a drop in tourist arrivals. It has also had an impact on investor confidence. What revenue generating measures would you propose to overcome this situation?
A: We have faced such situations earlier and we have to be ready to face such situations in the future. As a democratic country, the government has to first think of the safety of its people. For that purpose, the government has to make certain decisions that would sometimes have a negative impact as well.
Any country would have to face such eventualities and without making such decisions, no country could move forward. The country might have some issues, but if you look at the tourist arrivals for this year, it has been good. According to statistics at the Central Bank, the tourist arrivals in the first nine months of 2006 has seen a 9.5% increase when compared to the same period in 2005. That increase has happened
even when the country was facing several issues.
The Foreign Direct Investments (FDI) in the first six months of 2006 have seen a US$ 1,240,000 increase. These statistics are available with the BoI. If you take the stock market, the index was 1922 at the end of 2005, and by October 25, it has increased to 2507, that is a 30% increase. So you see that none of the problems faced by the
country are a barrier for the country's growth. They are minor issues that the country would have to face but still move forward.
Q: The Co-Chairs have clearly stated that financial assistance to the country would be tied to the peace process. Given the deadlock at the last Geneva talks, what measures does the government plan to implement to overcome this situation?
A: There should be a problem if the government was purposely trying to move out of the peace process. But there is nothing like that. The government is sincere in its efforts to find a solution to the problem and will continue to do so even amidst many challenges. Although there are certain factions within the government who harbour different opinions on finding a solution to the conflict, the President is
firm in his stance when it comes to finding a peaceful solution.
Our first responsibility is to protect the people who believe in a democratic system and then we will have to look at the rest. The world today has identified what terrorism is. So it is nothing new and every country is aware of how a democratic country would have to operate when facing terrorism. I believe that every country that respects democracy would help Sri Lanka.
Q: The government has failed to recover monies due to the state, for example the massive VAT fraud that caused losses amounting to hundreds of billions of rupees. What new measures does the government propose to recover these dues?
A: Yes, we have taken a lot of steps to prevent these things from happening in the future. If you take that case alone, the President has personally issued orders to the IGP and most of the offenders have been apprehended and the police is seeking the help of Interpol to apprehend those who have gone overseas. Their accounts have
been frozen and the assets too have been frozen.
People should know these things as they are keen to know what becomes of their money. Special steps have now been taken to prevent such scams. Now VAT refunds have been limited and an amount has been identified and transactions do not exceed that amount. It is now not a monetary transaction. The taxpayer does not pay us and vice versa. It is all done through a letter and to make a refund, the taxpayer has to provide
us with a bank guarantee to be entitled to a VAT refund, so if there is any irregularity we recover the money from the bank.
We have learnt a lesson from the VAT fraud and have taken every step to prevent it from happening in the future. Also, the tax department has many vacancies, so we have taken steps to employ a young and energetic cadre to carry out work in the department. Through all these measures, I feel that we might be able to overcome a lot of problems faced by the Inland Revenue Department.
Q: The government recently moved a supplementary estimate to raise vital funds. But this is also an indication of bad economic management. What are the specific areas that have seen heavy overspending?
A: I explained this clearly to parliament. We moved a supplementary estimate of Rs. 109 billion and of that, Rs. 53.2 billion were transactions in books, which means they are not new transactions. From 2003 till 2006, the government has been paying a fuel subsidy to shield the masses from the rising global fuel prices. The Treasury requested the Ceylon Petroleum Corporation (CPC) and the Ceylon Electricity
Board (CEB) not to raise its prices as the losses incurred would be set off against the taxes due to the Treasury.
That transaction has to now be balanced and taken off the books, so out of the Rs. 109 billion, Rs. 53.2 billion would be used to end the transaction between the Treasury and the CPC and the CEB. The balance has been used for several purposes.
One is to pay off the fertiliser subsidy. The other is the percentage invested by the government when FDIs come into the country. For example, when the Chinese government funds the Norochcholai power plant, the government too has to spend a certain percentage, those have also been included in this estimate.
The government also had an increase in expenditure when it came to the SAF games, the local government polls and to send the displaced persons back to their homes. When you look at it, there has been no wastage of funds. It could be called bad economic management if any of these expenses could have been foreseen by the government, but it was not so and in some instances, it has been out of the government's control.
We always speak of inflation, so keeping that in mind we moved this supplementary estimate.
It would only be an issue if the government has used the money to increase the salaries of MPs or organise a carnival. There is no such thing in this case.
Q: The government's coalition partner, the JVP, is to present its own set of proposals to be included in the budget and have said that their support to the budget would depend on it. How do you respond to it?
A: The JVP is a coalition partner of the government and proposals forwarded by such an important party cannot be ignored by us. We have also looked into every proposal sent by ordinary people as well. That is the difference in this budget.
Earlier, everything was done secretively, but now it is done openly. If any proposal seems important, the President will also look into it. So the JVP is an important part of the government and we will pay special attention to their proposals and I believe that there would be no problem in that aspect.
Q: Graduate employment was given precedence in the Mahinda Chinthana as well as in the last budget, but most of the unemployed graduates have now taken to the streets claiming the government had not honoured its pledges and that the Treasury took back the funds allocated for the project. How does the government respond to it?
A: This government has worked honestly to grant employment to the unemployed graduates. In 1970, the late Sirimavo Bandaranaike gave employment to 10,000 graduates and then in 1994, Chandrika Kumaratunga gave employment to 14,000 graduates. Last year we granted employment opportunities to 42,000 graduates amidst various allegations. Now when you take this year, there is a new batch.
There indeed is a problem when it comes to the country's education system and employment generation. The government is looking at solving the issue on the short and long terms. This year the government has plans to grant employment to about 7,000 graduates. We also have another problem and that is the shortage of teachers in difficult areas. The Education Minister is in the process of gathering more information on
the matter. This process is not politically motivated in any way. Everyone has been given an equal opportunity.
None of the graduates employed by the government were ever asked about their political affiliations. The government plans to employ 544 tax officers and they will be employed after they sit for a public examination. There might be certain issues in the process, but we will gradually overcome them.