New wage will cost Rs 6b for RPCs - Planters’ Assn. chief

The Planters’ Association Chairman Dhamitha Perera told the Annual General Meetings on Friday that the new wage structure would mean an additional cost of Rs. 6 billion for the Regional Plantation Companies (RPCS).

Planters’ Association Chairman Dhamitha Perera addresses the Annual General Meeting.

“This will be an additional cost between Rs. 250 - 450 million depending on the workforce for each RPC - and will have a drastic impact on the cash-flow”, he said.

However, the silver lining is that for the first time, a productivity linked component was incorporated into the total wage that would make the industry competitive in the world market. “Sadly the breakdown of daily operations and dispatch of tea adversely affected the image of the Sri Lankan Tea Industry”, he said.

Referring to the VAT issue, Perera called upon the Guest of Honour Secretary, Ministry of Plantation industries Mrs. Indrani Sugahtadasa to help restore the zero rating extended to indirect exporters that would benefit RPCs. He said that it is essential that the total Cess funds be ploughed back to the industry. “Considering the vintage of our tea it is essential that replanting be accelerated for the long term sustainability of the industry and factories upgraded to meet the stringent demand of our overseas buyers and consumers” he said.

Perera also referred to the two vastly different reports on the plantation industry presented during the year.

The 10-member Committee headed by Neville Piyadigama was transparent and professional and highlighted that the Government had to meet a cost of Rs. 400 million monthly to fund the operational costs of the state organisations that ran the estates prior to privatisation whereas the estates under RPCs are no longer a burden on the Treasury.

However, the report of the four member committee headed by Minister DEW Gunasekera in contrast created confusion due to incomplete reports in the press. “Memories appear to have been shortlived”, Perera said.