Throughout Sri Lanka’s history, rulers’ short-sighted decisions have taken its toll on the country. While the prevailing socio-economic crisis is a prime example of it, some of the most disastrous events that befell the country, such as the 30-year war had a lot to do with rulers’ short-sighted decisions. However, it seems that the government has not learnt some lessons from past mistakes.

Sri Lankans have over the last few years have faced many natural and man-made challenges, they have endured, and tightened ‘belts’ to adjust to new realities. Many long for some relief, key amongst them are electricity bills, which has become a significant issue for domestic, retail and industrial consumers.   As such, it is no surprise when concerns stemmed from the government’s decision to oust former Chairman of the Public Utilities Commission of Sri Lanka (PUCSL) Janaka Ratnayake. It seems the government embarked on ‘removing an obstacle to policy’ without a proper plan to promptly replace him and keep the regulator functional. Some observers have questioned if this was a short-sighted move, or was it deliberate? The PUCSL is now a headless institution, with a vacant chairman position, what it can do in terms of regulating the provision and pricing of electricity is extremely limited.

The government’s obvious response is that this is a temporary situation. However, with long-awaited electricity tariff revisions beneficial to the public are in the pipeline, (by the end of the month) the absence of a chairman has placed the PUCSL in a state of limbo, where it is unable to take the necessary regulatory decisions. According to certain PUCSL members, at present, the institution is not in a position to take a decision regarding the public consultation on the said electricity tariff revision, which is slated to come into effect on 1 July. The Ceylon Electricity Board (CEB) has stated that although it is prepared to implement the said tariff revision from 1 July, it would be impossible without the PUCSL’s permission within the due course. In other words, despite the ability to reduce, electricity tariffs are likely to remain unchanged. Until removed from post, the former chairman of the regulator had maintained that the government could offer a better tariff revision, thereby giving consumers more relief.

The fact that the government has failed to effectively replace the PUCSL chairman, with the urgency they removed him, raises serious concerns about the government’s motives, competency and public-friendliness. It is not difficult to understand that a country like Sri Lanka with many issues in its power and energy sectors cannot keep the provision of electricity stable without a functioning regulator. However, despite these obvious concerns by electricity consumers, the Parliament enthusiastically voted to oust Ratnayake without even a plan to replace him. This is where the question about the government’s priorities arises. Now, because of the government’s short-sighted actions, electricity consumers are less likely to get the benefit of the proposed tariff revision. It also speaks poorly of the governance of the country.

This is not just a matter of ordinary electricity consumers’ household electricity consumption continuing to be subjected to high tariffs. This is a matter that impacts the country’s economy, which has already been affected by the Covid-19 pandemic, socio-economic crisis and new taxes. At present, Sri Lanka has no functioning utility regulator, which triggers concerns about the provision and pricing of electricity. Although it may not sound a big issue for the time being, for local and foreign investors and other forms of businesses to generously invest in their businesses in Sri Lanka, they need some sort of assurance that at least the most basic utilities would be provided at a reasonable price without an interruption. They need to be able to see that the regulator is effective and trustworthy. Further, under the current situation, critical export industries will struggle to draw up their bids for international tenders, as there is a doubt about the timelines and implementation of a tariff change. How can our export industry, which has had long-term challenges, take high-risk decisions on cost pricing with no clarity on what their electricity bills will look like for the next few months. With no functioning utilities regulator and no concrete answer from the government, how will the export industry make such a decision? And will such a situation help build investor confidence?

Government’s intervention into independent institutions is not a good sign. On the one hand, it sends a message that such institutions can remain independent but it is only to an extent decided by the political authority, and on the other hand, the failure to uphold even established institutions. It is high time for the government to walk the talk. If the PUCSL chairman had to be removed due to resisting national policy, then what next?  The government must take steps to ensure that the proposed tariff revision comes into effect on 1 July, or that delays do not affect the implementation of the same on a later date. The regulator’s stability and consistency is paramount for fair and legal regulation of any sector. A critical sector like power and electricity, need to have a well-resourced and competent regulator to effectively serve the citizens.