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Challenges mount for RW Govt. as IMF pushes more tax collection amid growing public dissention

Challenges mount for RW Govt. as IMF pushes more tax collection amid growing public dissention

21 Jan 2024 | By Capt. Vasabha

  • RW meets Jaishankar in Kampala; Indian FM talks about Indian-funded projects
  • Meeting with South Africa’s Ramaphosa focuses on Truth and Reconciliation Commission
  • Palestinian Foreign Minister, UN rep meet RW, thank for support and statement at NAM
  • RW’s media team prevented from recording NAM speech due to Ugandan Prez’s order
  • Basil plans strategy to counter allegations against SLPP, Rajapaksas; trains 300 individuals 
  • MR says SLPP may not field candidate; dismisses talk of Namal contesting
  • Namal says RW in SLPP candidates’ list, Prasanna says no deal with Dhammika
  • Basil advises Dhammika to move out of media campaigns and focus on grassroots
  • Sajith points out difference between SJB and UNP; UNP working on broader alliance
  • AKD looks at new national awakening; Lalkantha and Vijitha contradict on new partners

President Ranil Wickremesinghe and his Government now have their work cut out given the continuing economic challenges and growing public dissention amid preparations for an election year.

The skyrocketing prices of food commodities, especially vegetables, has now resulted in people posting their vegetable purchases along with the bills on social media, which is in turn widely shared online.

While the general public is struggling to make ends meet and shoulder the burden of high taxes slapped on goods and services, a news report published in a Sinhala newspaper quoting a trade union leader affiliated to the Ceylon Electricity Board (CEB) caught the attention of many. 

The news story had stated that the CEB had provided a power generator valued at around Rs. 50 million to Sri Lanka Podujana Peramuna (SLPP) Leader, former President Mahinda Rajapaksa (MR) without charging the Value-Added Tax (VAT). CEB Trade Union Leader Ranjan Jayalal had further told the newspaper that the Presidential Secretariat had directed the CEB to provide the relevant generator to MR’s residence. He had added that the generator had been estimated at a lower cost by a group of ‘spineless’ CEB officials.

President Wickremesinghe meanwhile continues to draw criticism over the double standards on austerity measures that resonate the old slogan ‘nagareta kiri, gamata kekiri’ (milk for the city, cooking melon for the village), only now it is more of a case of ‘kekiri’ for everyone except a few chosen political elites.

Wickremesinghe, who was on a long tour of Switzerland and Uganda, is due to return to the country today (21) with part of his delegation while the rest of the delegation is due to return on Wednesday (24). The President’s frequency of overseas tours had gathered much public criticism, especially given the many hardships faced by the masses.

However, a recent statement made by United National Party (UNP) Chairman, MP Vajira Abeywardena about his Party Leader’s foreign trips and the reason for such tours was quite interesting. He has said during a media briefing that President Wickremesinghe was engaged in overseas trips to garner the attention of the international community to receive support for Sri Lanka to overcome the ongoing crisis.

Be that as it may, Wickremesinghe is expected to prorogue Parliament on Wednesday (24) evening (since Thursday is a Poya holiday) and it is expected to be reconvened around the second week of February. Parliament therefore will hold sessions only for two days this week – Tuesday (23) and Wednesday. Both these days are to be taken up by the proposed new Online Safety Bill (OSB).

However, the prorogation of the House will dissolve key parliamentary committees, including the Committee on Public Enterprises (COPE), Committee on Public Accounts (COPA), and Committee on Public Finance (COPF).

COPE is one of the key committees that is in need of reconstitution, given that the committee has not been properly convened following the controversy surrounding its Chairperson MP Ranjith Bandara over an alleged case of conflict of interest with Sri Lanka Cricket (SLC). COPE has not properly convened since the Speaker of Parliament suspended committee sessions following objections raised by Opposition MPs.


Meeting Jaishankar

President Wickremesinghe yesterday (20) met with Indian Foreign Minister S. Jaishankar on the sidelines of the Non-Aligned Movement (NAM) summit.

During the meeting, it is learnt that Jaishankar had directed Wickremesinghe’s attention towards the delays in getting some of the Indian-funded projects off the ground. The President had pointed out that some of the delays had been due to technical issues at both ends.

Both Wickremesinghe and Jaishankar are also expected to meet again next month in Australia before the Indian elections in March.

Meanwhile, President Wickremesinghe met with South African President Cyril Ramaphosa on Friday (19) evening in a one-on-one meeting. It is learnt that the two leaders had discussed the Truth and Reconciliation Commission (TRC) and South Africa’s assistance for Sri Lanka.

Wickremesinghe had also met Palestinian Foreign Minister Riyad al-Maliki and the Palestinian UN PR delegation had requested a few minutes with the President last evening at the NAM banquet. It is learnt that they had thanked him for his statement and the continued support for the Palestinians.


Ugandan trip

Meanwhile, President Wickremesinghe’s visit to Uganda to attend the NAM summit was not without its fair share of drama.

While Wickremesinghe travelled to Kampala from Switzerland, some of his officials travelled to Uganda from Sri Lanka on Thursday (18). It is learnt that the President’s delegations to Switzerland and Uganda had been divided into two groups. One group had accompanied the President to Switzerland and had returned to Sri Lanka following the Davos trip, while around three officials had accompanied him from Switzerland to Uganda. The other group of officials had joined Wickremesinghe directly in Kampala.

However, it is learnt that the President’s Media Division representatives had been turned away from the hall where the NAM conference was being held due to a directive by Ugandan President Museveni. It is further learnt that the Ugandan President had directed his officials to stop media units of other countries from recording speeches of participants at the event other than his (the Ugandan President’s) speech. This move had come as a surprise to the Sri Lankan officials, who had set up their equipment to record Wickremesinghe’s speech.

It is also learnt that the agenda for Wickremesinghe’s stay in Kampala was also quite disorganised, resulting in several of his staff members noting that it was good that the President was leaving Uganda soon after his official engagements.

News of Sri Lanka’s Ambassador to Uganda V. Kananathan making many arrangements for the President during his stay in Kampala was reported in ‘Black Box’ last week. Meanwhile, there are also reports that Tamil diaspora businessman Subaskaran Allirajah, who has many business interests in Sri Lanka, was also in Uganda at the same time.

Once Wickremesinghe returns to Sri Lanka today, a group of his officials who will be in Uganda till Wednesday are to attend the events being held on the sidelines of the NAM summit. 


IMF for more taxes

While the President, who is also the Finance Minister, was out of the country, the team from the International Monetary Fund (IMF), which was in Sri Lanka last week, indicated the need for Sri Lanka to generate more revenue from taxes, especially through a property tax. This is despite the Sri Lankan Government showing the IMF during its most recent engagements with the Finance Ministry that Sri Lanka had earned more revenue than was initially communicated to it.

IMF Senior Mission Chief to Sri Lanka Peter Breuer noted that swift progress towards the introduction of a ‘progressive property tax’ was key to ensuring fair burden was shared while sustaining revenue-based consolidation. “A property tax will help Sri Lanka take the quantum leap to achieve the IMF programme’s goals,” he had said.

Breuer had also expressed hope that Sri Lanka would reach agreements concerning debt restructuring ahead of the second review of the programme. He had added that a swift completion of final agreements with official creditors and reaching a resolution with external private creditors remained critical.


Presidential Polls

Meanwhile, the public’s sentiment on holding elections and the election that should be held first was revealed last week in research carried out by a private firm. The research findings have reportedly shown that a majority of Sri Lankans want the Presidential Election to be held first.

The survey had been carried out by one Lanka Research company and it had revealed that only 20% of people wanted a General Election to precede the Presidential Poll.

The research had also revealed that 81.9% of the population had stated that the economy should be stabilised through converting it into a production-based one and by enhancing exports. Meanwhile, 34.6% had reportedly expressed belief in a system change while 16.5% had noted that the country could be developed through stringent laws.

Meanwhile, the Election Commission has expressed hope that the necessary funds for the preliminary work related to the upcoming Presidential Election would be received by the end of June this year.

Election Commission Chairman R.M.A.L. Rathnayake has said that they had already initiated certain work related to the Presidential Election such as the revision of the voters’ registration, but that they had received separate funds for such activities. “We will consider the 2024 voters’ registration in holding the Presidential Election. The revision of the voters’ registration is considered as general work of the Election Commission, so we have received funds for it.”


Basil’s plan

The ruling SLPP meanwhile is in the process of launching a new campaign that has been mooted by the party’s Founder and founding National Organiser, Basil Rajapaksa.

Basil has proposed the new programme and assigned the task to SLPP General Secretary MP Sagara Kariyawasam. The programme is reportedly being called ‘The truth can never be hidden like the sun and moon’. It is learnt that this programme is aimed at responding to the many allegations levelled against the party as well as the members of the Rajapaksa family, especially the allegation on looted public funds said to be held overseas.

Under the latest programme, the SLPP is to train a selected group of individuals to respond to the longstanding allegations through small pocket meetings held at electoral levels. So far, around 300 individuals have reportedly been identified to be trained.

Basil anticipates some of the longstanding allegations against members of the Rajapaksa family to be taken up on the political stage by Opposition parties during the election campaigns. Therefore, he has pointed out that there should be one set of answers to be given to such allegations without SLPPers making various statements.

The event to train the individuals to conduct the programme was launched at a recent meeting at the Grand Monarch in Thalawathugoda, presided over by SLPP Leader, former President MR. Senior members of the SLPP were also present at the event. The participants had been informed of the SLPP’s political strategy to overcome the public discontent it had faced since the 2022 economic crisis and the ouster of former President Gotabaya Rajapaksa.

A series of public meetings amounting to around 3,000 will be held islandwide in the next few months under the theme of revealing the truth behind the allegations made by Opposition parties.


MR’s take

Meanwhile, SLPP Leader MR has said that the party could field a SLPPer or even an outsider at the next Presidential Election.

“We (SLPP) have not yet made a decision on the presidential candidate. The SLPP might field a candidate or it might not,” MR had told the media. Nevertheless, he had told the media on another occasion that the party would field a candidate who could win.

According to MR, the party will pay much attention to the thoughts of the SLPPers at village level when deciding on the next course of action.

However, MR had also recently dismissed talk that his eldest son and heir apparent, SLPP MP Namal Rajapaksa was planning on contesting as the SLPP’s candidate at this year’s Presidential Election. MR had made this statement to a group of SLPP MPs who had asked him if Namal had plans to contest the Presidential Polls.

After dismissing such stories, MR had explained that 2024 was too early for Namal to make such a move as he had more time.


Namal’s contenders

Namal meanwhile had last week told the media after an event that President Wickremesinghe was also among the contenders for the SLPP’s presidential candidacy.

He had pointed out that Wickremesinghe had been made President by the SLPP and further noted that the President was with the SLPP and was also among the contenders for the SLPP’s presidential candidacy. 

It is now clear that Namal’s target is to position himself as an Opposition parliamentarian – similar to how his father (MR) had also built himself to become a national leader – before throwing in his hat into the presidential race. It would therefore be correct to note that Namal will be targeting the 2030 Presidential Election after building himself up as a people’s politician in the Opposition.


Prasanna’s support

Senior SLPPer Minister Prasanna Ranatunga has also said that Wickremesinghe should be given another chance as president to revive the economy and stabilise the country. He had made this observation during a meeting in the Minuwangoda area with Local Government representatives.

Ranatunga had said that he personally believed Wickremesinghe was the best person to resolve the prevailing economic crisis and that the country was not in a situation to experiment, which would only worsen its collapse.

Meanwhile, Ranatunga had told journalists in Matara following an event last week that the SLPP had not reached an agreement with businessman Dhammika Perera to field him as the party’s candidate at the next Presidential Election. “I am an active member of the party. As far as I know, the SLPP has not entered into any agreements with Dhammika Perera on the presidential candidacy,” he had said.


Dhammika’s solo campaign

However, Perera, who seemed to be out of the media spotlight last week, seems to have subjected his campaign strategy to some changes.

Perera, it is learnt, has formulated a plan to carry out his campaign at a different level. It is aimed at targeting the lower-middle class and lower segments via his grassroots outreach campaign through his DP Education programme.

Basil is one of Perera’s main political advisors and it is also learnt that Basil has advised the frontrunner to the SLPP’s presidential candidacy to focus more on his grassroots level outreach rather than focusing on media campaigns while being in the spotlight at the present time.


UNP says no

Meanwhile, the UNP has said that the party has not yet reached any agreement with the SLPP on forming a coalition to contest the next Presidential Election.

UNP General Secretary Palitha Range Bandara has said that while there was no agreement by the SLPP to support President Wickremesinghe at the next Presidential Election, the UNP had decided that Wickremesinghe would be the party’s presidential candidate.

However, Bandara has said that the President and the UNP were working to make a platform where everyone could get together for the development of the country rather than contesting the said election separately, and that, therefore, the upcoming Presidential Election was identified as a good point where they could gather together different political groups.


Awaiting defectors

The SLPP meanwhile is also looking at attracting defectors from other political parties. The party’s General Secretary Kariyawasam has noted that the defections of several groups from the party since 2022 have not harmed the party’s standing among the public.

“It is only the MPs who left the SLPP. The people are still with us. These MPs cannot get even 1,000 people to attend a rally. We are of the view that they initially accepted our programme and then left us. We are still working on the same policy. If they need to rejoin the SLPP, we will gladly welcome them,” he had told the media.

Kariyawasam had also stated that most of the political parties and movements that had aligned with them during previous elections in 2019 and 2020 were still with the SLPP.


Udaya’s prediction

While the SLPP-UNP Coalition Government is looking at Presidential Elections, SLPP dissident MP Udaya Gammanpila has said that the Government’s candidate at the next Presidential Election will suffer the worst ever defeat.

He had said last week during a media briefing that the candidate fielded by the Government side would poll the lowest votes, maybe even in world history. Gammanpila had pointed out that there was growing public dissent against the Government and its failure to protect the people.


SJB, UNP difference

Meanwhile, Opposition and Samagi Jana Balawegaya (SJB) Leader Sajith Premadasa has explained the difference between the economic policies of the SJB and the UNP, stating that the policies of the two parties were worlds apart.

The Opposition Leader had said during an event that countries professing socialism or communism did not truly implement it and instead engaged in extreme capitalism while pointing out that China embraced capitalism even more than America.

According to Premadasa, socialism is not the way to build the economy or a country, but capitalism is the true way.

He had further noted that the SJB and the UNP were starkly different to each other as the UNP followed crony capitalism while the SJB believed in a social democratic policy, which could be called humanistic capitalism.


Anyone to NPP

Meanwhile, the Janatha Vimukthi Peramuna (JVP) and its political alliance National People’s Power (NPP) appear to be at crossroads over broadening its existing political alliance and the individuals to be accepted into it.

JVP Politburo member and NPPer K.D. Lalkantha has recently claimed that there was no one who could be disregarded in the present struggle. He had said during a public meeting in Kandy that the NPP was absorbing all progressive groups in the society. 

He had noted the difference of the JVP, saying that the JVP was used to absorbing only a selected group. Lalkantha had said that the support of all sections of society was needed in the current struggle to secure power.

“We can’t neglect anyone in society in the present struggle. We, as the JVP, absorbed only a selected group in the society. What we, as the NPP, do is to absorb all groups which are willing to do progressive things,” he had added during the event.

Lalkantha’s statement is a contradiction to the position taken by JVP Politburo member and NPP MP Vijitha Herath, who had recently stated that the NPP would not accept every individual who expressed interest in joining the alliance. Herath had further stated that the NPP would not accept individuals who had been responsible for bankrupting the country. 


Rescuing country

JVP/NPP Leader Anura Kumara Dissanayake meanwhile has called for a new national awakening against those who he had termed as ‘a ring of thieves’ who keep on provoking racism and other differences for their survival.

Addressing the Hambantota District Women’s Convention, Dissanayake had said the NPP would prove through practice that they would not misuse or loot public monies and set an example to the people.

“The President has thousands of Army and Police teams assigned for his security. Police stations at village level have only about 10 Police personnel. We will bring the security detail of the President to the Galle Face and dissolve it and send them to Police stations in the villages. The President and other politicians use expensive vehicles that run only two to three kilometres a litre. We will stop using such expensive vehicles. We will ensure transparency in construction work and development in the country. We will set an example to the people so that they can follow and come forward and do their part for the sake of the country,” he has been quoted as saying.

Dissanayake had further noted that the future election was not just another election to vote for a political party and form a government, but would instead be a struggle to rescue the country from corrupt and destructive rulers.


Suzuki’s message

While the local political scene is heating up over elections due this year, Japanese Finance Minister Shunichi Suzuki, who was recently in Sri Lanka, has reminded the Sri Lankan Government of the country’s priorities as well as the urgent need to complete the country’s debt restructuring.

Suzuki had even given this message during his meeting with Opposition Leader Premadasa and an SJB delegation. Suzuki had also told Premadasa that the country should not jeopardise the IMF programme.

The meeting between Suzuki and the SJB was also attended by Ambassador Mizukoshi Hideaki.

It is learnt that Japan had also told the Opposition members that Sri Lanka had to pay for the termination of a $ 1.5 billion Japanese-funded Light Rail Transit (LRT) project. Suzuki had told Premadasa that Sri Lanka must pay for the cancellation of the project in order to resume stalled projects.

Former President Gotabaya Rajapaksa ordered the termination of the $ 1.5 billion Japanese-funded LRT project, saying it was not a “cost-effective solution” for the congested capital Colombo. The Japanese loan carried an interest rate of 0.1% and was repayable over 40 years with a 12-year grace period.


Cutting costs

The increasing focus on the Government’s expenditure while burdening the public has resulted in the issuing of a circular by the Treasury Secretary, giving special directions about several areas in the public sector, including expenditure control, essential expenditure, salaries, allowances, and travel expenses.

The directive indicates that the fiscal space has become extremely limited due to the increase in public expenditure and limited public revenue in the challenging economic environment.

The circular was issued a week after the media reported about a recent gathering of a group of Government ministers and SLPP MPs at the Colombo Port on a vessel belonging to the Sri Lanka Ports Authority (SLPA). The relevant ministry has defended the gathering as an ‘observation tour’ of the development work in and around the harbour and the SLPA has also issued a statement denying spending its funds on the event. Nevertheless, the Commission to Investigate Allegations of Bribery or Corruption (CIABOC) has commenced a probe into the incident after receiving a complaint from a group of trade union activists.

Department of Treasury Operations Director General Dilip Silva said that the said circular had been issued by the Treasury in parallel to the Budget for this year. He had reportedly noted that the circular would direct all public servants, especially administrators in the public service, to manage the funds they received from the Government with the fullest productivity in mind and not mismanage those funds.


Mahinda’s contradiction

Meanwhile, a recent statement in Parliament made by Finance Ministry Secretary (Treasury Secretary) Mahinda Siriwardana had reportedly sparked controversy. Siriwardana had reportedly said during a parliamentary committee meeting that the country had never been officially declared bankrupt. 

Hence, Siriwardana’s statement is seen as a contradiction to President Wickremesinghe’s public statement that Sri Lanka aimed to come out of its state of bankruptcy by around September this year. The Finance Ministry Secretary had reportedly emphasised that the declaration merely indicated the inability to pay selected debts.

Siriwardana had further revealed that the Monetary Board of the Central Bank of Sri Lanka (CBSL) had submitted a confidential report to the Minister of Finance in 2022, predicting an increase in inflation and a decrease in foreign reserves.

This matter had resulted in Opposition legislators noting that the contradiction between the Finance Ministry Secretary and the President, who also serves as the Finance Minister, raised questions about the Government’s understanding of the country’s financial status.


Letter to CC

President Wickremesinghe meanwhile has reportedly sent a strongly-worded letter to the Constitutional Council (CC) with regard to his recommendation to appoint a new judge to the Supreme Court.

The Constitutional Council, it is learnt, is yet to respond to his request that Nissanka Bandula Karunaratne, presently Chairman of the Court of Appeal, be made a Supreme Court judge.

The President had pointed out in his letter that the Constitutional Council should essentially take a decision with regard to his recommendation. The letter has reportedly noted that the indecision of the Constitutional Council had seriously disrupted judicial activities and prevented the enforcement of the law of the country.

Appointments are yet to be made to four positions that have remained vacant for some time in the Supreme Court and the Court of Appeal, according to reports. A successor is yet to be appointed to fill the post that fell vacant following Justice Buwaneka Aluwihare’s retirement from the Supreme Court about a month ago.

Vacancies also exist in the Court of Appeal following the retirements of Justices Prasantha Silva, N.D. Keerthisinghe, and Neil Iddawela.



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