PARLIAMENT

‘IMF Economists commend govt’s economic policies’

Irangika Range and Disna Mudalige

Speaker Chamal Rajapaksa presided when Parliament met at 1.00 pm yesterday.

After the presentation of papers and oral questions, the House adjourned until 1.00 pm today. The House took up the adjournment motion moved by UNP MP Ravi Karunanayake for debate.

Ravi Karunanayake (UNP): All citizens in the country have already felt the ill the omens of an impending economic danger. The government belittles and humiliates our concerns of the economy. We point out these issues for the betterment of the country. Poor water management has led to the drought. The share market is not functioning smoothly.

Local and foreign investments in the country and the independent functioning of the Central Bank are not properly facilitated. The government blames the UNP even for its own shortcomings.

The depreciation of the rupee has increased our debt burdens. The debt burden of the country must be reduced considering our repayment capacity.

Deputy Speaker Chandima Weerakkody takes the Chair.

Dr. Harsha de Silva (UNP): I second the motion. I would like to speak on several issues brought out by MP Karunanayake. The government deliberately avoids answering questions relating to economic management when we raise them in the House. A responsible government must not do so.

We have frequently raised questions on the management of the EPF and ETF funds. When we raise such questions, the government labels us as anti-patriots and assassins of the economy.

International Monetary Cooperation Senior Minister Dr Sarath Amunugama: The Opposition has constantly lost at elections and it is going to lose the upcoming elections too. The Opposition is rejected by the people over and over again, but we listen to their views too as a democratic regime.

The government is following its own policy with regard to economic management. I have given a comprehensive answer to the matter raised in the House over the Greek bond investment. If the Opposition is not satisfied with it, it can ask for further clarifications.

The government is pursuing economic targets and goals set by ourselves. Economists in the IMF have also commended the government's economic management policies and growth.

Please refer to the statistics and information issued by the Central Bank. The statistics show improvement at all levels. From 1948 - 2004, the per capita income was less than USD 1,000. It surpassed USD 2,000 in 2009. Last year it was almost close to USD 3,000. We hope to achieve USD 4,000 in 2015.

We have invested only seven percent of the EPF money in equities. The balance remain in the Fund. We made these investments at the right time considering all facts of the economy after a comprehensive study.

Our objective is to use the EPF money to stimulate and strengthen the economy. What is wrong with that? Not a single EPF holder went before courts against this investment. They know the final reward that they gain will be enhanced.

Sujeewa Senasinghe (UNP): You must follow proper procedures to invest money. This is public funds. You cannot misuse these funds. The country has already incurred losses amounting to Rs. 32 billion due to investments made by the government in the stock market. It has been proved that the government has not followed the proper procedure to invest EPF and ETF funds.

Industry and Commerce Minister Rishad Bathiudeen: Before I was appointed Industry and Commerce Minister by President Mahinda Rajapaksa I held the portfolio of Resettlement and Disaster Relief Services. The Tamils of the Northern Province would recall how as Resettlement Minister I spearheaded the government’s programme to resettle the displaced Tamil people in the Northern and Eastern Provinces with great rigours and enthusiasm under the guidance of Minister Basil Rajapaksa.

I carried out the task of resettlement under high risky conditions. I should also mention that on my request the Madhu Church, damaged during the LTTE terror campaign was reconstructed.

Sunil Handunnetti (DNA): We debate about the economic management of the country. Dr Amunugama’s speech is attractive, but we have doubts about the reality of its content. Non tax revenue of the country during January to May has decreased by 13.4 percent. The economy of the country is not based on production today.

Tax revenue during the first five months has gone up by 21.1 percent. The expenditure on imports is unbearably high.

A H M Azwer takes the Chair.

Labour and Labour Relations Minister Gamini Lokuge: The country is self sufficient in many agricultural products. We have been able to maintain self sufficiency in rice despite the drought.

MP Handunnetti spoke about the loans obtained by the government. However, he did not speak on what projects these loans were used. These loans were used effectively on grand scale development activities as well as village level infrastructure development.

There has been no delay in payment of EPF benefits. The EPF has one trillion rupees today. President Mahinda Rajapaksa’s decision taken when he was the Labour Minister that all EPF accounts must be under the General Treasury, has contributed to this achievement.

Shantha Bandara (UPFA): The EPF Act has been amended on several occasions to suit employee requirements. Today a fear psychosis is being generated among workers by the Opposition that the money in the Fund is being abused by the government. This government never resorts to such cheap levels.

The government led by the President has a high respect for the working class.

Eran Wickramaratne (UNP): It is sad that Minister Bathiudeen made a speech in the House which he should in fact have made in the court.

The question at heart is the independence of the Central Bank, when speaking about the economic management. The Sri Lankan rupee has depreciated from 113 to the USD to 135.

In the share market, the EPF money is being invested to buy company shares at above the incentive value and these companies are not listed as ‘blue chip’ companies.

Human Resources Senior Minister D E W Gunasekara: At the conclusion of the debate, I believe that most of the arguments presented by the Opposition were successfully countered and answered by the government.

I must say that the Opposition should not demand to implement its economic policies by the present regime. The economic policies upheld by them are contrary to ours. We welcome constructive criticism.

Despite the world economic crisis, the economy of the country has been improving. The unemployment rate has dropped to about 4.6 percent.

The subject of economy is the science of variables. Therefore, there is no static indication in economy. The EPF is a result of sweat and toil of employees. The labourers’ movement gained this achievement undergoing many hardships.

This Fund is the largest fund in the country today which has about one trillion rupees. This money should be invested, but it must be done with utmost care.

At the COPE sittings yesterday, we advised the Exchange Commission to have an eye on public funds. In 2012, the interest rate of the EPF has been maintained at 11.5 percent. It was 10.1 percent in 2005-2006.

I believe the Central Bank should discuss with the Labour Commissioner when EPF money is invested on any venture.

Dr. Jayalath Jayawardena (UNP): The EPF money of the SLTB has not been paid in 2011 and 2012.

The Trade Union Federation must be educated on the developments of the EPF.

This Federation has about 21 unions. The reality of the EPF issue must be exposed to them. I request to appoint a Parliamentary Select Committee to probe into this issue.

Finance and Planning Deputy Minister Geethanjana Gunawardena: I am thankful to the members of both sides for their constructive criticisms and suggestions. But I regret the false information presented by some Opposition MPs.

The EPF money of the SLTB was questioned. However, Rs 3 billion of the EPF of the SLTB was not there, and it was remitted only in 1994.

It is during the UNP regimes that the State properties were sold indiscriminately to private parties. It is during the UNP regime that 1/3 of the country’s land was given to the LTTE.

The House adjournment until 1.00 pm today.