• No impact on EPF and ETF; PM claims

 Prime Minister Dinesh Gunawardena, in parliament, defended the government’s decision on domestic debt restructuring, arguing that the process will have no negative impact on the Employees’ Provident Fund (EPF), the Employees’ Trust Fund (ETF) and said the move will help stabilise and strengthen the banking sector.

However, the proposal which was passed with a majority of 60 votes, drew strong criticism from opposition parliamentarians who argued that the government was once again dipping into the superannuation funds of the working class who have no say in how the funds are controlled.

Speaking in Parliament on Saturday (1 July) during the debate on the proposal to implement domestic debt restructuring, he said that compared to Sri Lanka’s population of 22 million, the existing 57 million bank accounts are currently maintained and the Government was able to create confidence in local depositors amidst various allegations made by the Opposition and other external parties.

Gunawardena also said that the EPF which was established by then Government in 1958 under the Central Bank of Sri Lanka (CBSL) is the largest fund in the Asian continent with a value of Rs.3.5 trillion. He also emphasised that the Government would secure these institutions since those institutions have the largest financial deposits at the moment.

“In the past 10-11 months, some people in the House have probably forgotten that we went through the worst crisis that our country has gone through ever. We had to enter into the implementation of a debt restructuring proposal by making an public announcement as the same way we announced the bankruptcy of our country. In the last two or three weeks, the Opposition parties have issued many misleading statements as much as possible to bankrupt the State-Owned banks. Then the State Minister of Finance had to explain about it. They hoped that depositors would start withdrawing their money from banks. Fortunately such a thing did not happen. I feel sorry for those who were trying to create such a problematic situation,” he said.

The Prime Minister also said that the proposal for the domestic debt restructuring that was tabled to the Parliament by the Government, together with the support of the International Monetary Fund, the World Bank and also the local banking system must be supported by everyone in this country.

"I would like to urge again as the PM, not only this House but also all citizens to support this pure effort to move forward and bring success, despite the political ideologies you have and the side you sit in this Parliament. I invite you all to help us to overcome this crisis, and to become partners in the process of moving the country forward with a stronger financial and economic position by September,” he added.

Meanwhile, the Tamil National Alliance’s (TNA) main objection to the domestic debt restructuring plan was over the impact it would have on members of the EPF and the ETF, said TNA Parliamentarian (MP) M.A. Sumanthiran in response to the PM. “These are the voiceless working class of the country. I say they are voiceless because even with regard to their own savings, they have no say. They can’t make the decision,” he said.

Pointing to the EPF Act clause which says that the fund’s custodian is the Monetary Board, Sumanthiran asked whether members of the Monetary Board really were being responsible custodians and making this decision on behalf of 2.5 million working class members of the EPF. He said the EPF Superintendent who came before the Parliamentary Committee on Public Finance (COPF) the previous day had admitted that he did not know what the restructuring plan was.

“Myself, the Chairman of the COPF and Samagi Jana Balawegaya (SJB) MP Dr. Harsha de Silva said that the members of the EPF should be given at least 9% interest rate by considering the prevailing economic situation which is completely different from the situation which was there when the EPF Act was established,” MP Sumanthiran added. He also said that a reasonable interest rate should be given to the EPF when they invest in the capital market.

“I am wondering why these MPs do not raise their voice on behalf of these voiceless people. There are nearly 2.5 million members of the EPF. Those people have no opportunity to speak. As I see, only the MPs from the Opposition speak on behalf of them. I urge the Government and all the other MPs to stand with those voiceless people,” he said.