No private assets will be taken over by govt - Basil
Continued from yesterday
Following are excerpts of the speech made by
Economic Development Minister Basil Rajapaksa in Parliament on Wednesday
during the debate on the Revival of Underperforming Enterprises and
Underutilized Assets Bill
Some people said that molasses too are manufactured during the
sugar-making process. The investors have requested permission from the
Excise Commissioner to import 250 metric tonnes of cane molasses. When
the Excise Commissioner conveyed to the Sugar Research Institute, the
investors’ request to import molasses, the latter ruled it out as
completely wrong and cannot be allowed at any cost. The investors’ case
against the Excise Commissioner is pending in the Court of Appeal.
Minister Basil Rajapaksa |
Land was released to the investor only for cultivation and not to
import molasses and manufacture arrack. The institute was set up for the
benefit of the sugar cane cultivators - which is a public property. The
Ven. Maha Sangha should know that the industry does not benefit the
sugar-cane cultivators - instead moonshine is manufactured. I do not
know how the Ven. Maha Sangha speak on this issue. All conditions
stipulated in the agreement have been violated.
I should clarify this too. There are Mahaveli lands. Despite the
delay in handing over the deeds of transfer, the beneficiaries of state
land have taken over the possession of their allotments. Over 200,000
awardees of Mahaveli lands have not still been issued the deeds. As
provided for in the Mahinda Chinthana, all deeds have since been
released to the land beneficiaries. About 250,000 deeds will be released
soon. That the deed for this land had not been issued is not acceptable.
The President obtained a Court Order within a day to have the deed
released immediately. The President could have remained silent, but he
acted with due deference to judiciary.
National property
The Lanka Tractor Company which remains closed for a number of years
was not a loss-making venture. It was privatised in 1994. It earned a
profit of Rs. 25.5 million in 1989, Rs. 55.2 million in 1990, Rs. 29.3
million in 1991, Rs. 20.2 million in 1992 and Rs. 37.4 million in 1993.
Such a profitable venture was privatised causing the ruin of a national
property. There were 550 employees there who lost their jobs. The
corporation had been appointed local agents to Massey Ferguson Kubota
Tractors, and Taffa. The employees were denied their gratuities. This
Corporation was privatised for a sum of Rs. 148 million. We would not
have taken this step had at least the two valuable blocks of land at
Pettah and Narahenpita been made use of.
There is the allegation that state enterprises are running at a loss.
Some have incurred losses due to mismanagement attributable particularly
to the UNP governments. The Electricity Board is run not solely for
profit. It is a service. We have programmed to supply electricity for
all by July 2012 in keeping with the concept, ‘Electricity for all’ -
under the guidance of President Mahinda Rajapaksa. To reach this target,
we have commissioned rural electrification schemes, power generation
ventures, new generation profits at Norochcholai, Kerawalapitiya and
Upper Kotmale. Without solely depending on thermal power, we have used
alternate sources such as hydro-electricity and coal-fired energy. We
purchase electricity from some companies at the rate of Rs. 120 per unit
and sell it to the consumers for Rs. 4.50. We are providing a
transmission line to the North - from Vavuniya via Kilinochchi to
Chunnakam and till such time we have to depend on the two private
companies in the North for the supply of electricity at the rates
determined by them.
The Petroleum Corporation incurs a loss of Rs. 20 per litre of
diesel. We could show profit by merely increasing the price which we
don’t do. We don’t follow the ‘price formula’ practised earlier. The
loss from kerosene is Rs. 30 and it’s Rs. 45 from furnace oil in the
process of electricity generation.
Business enterprises
With regard to SLTB, I should say that we have deployed SLTB buses in
difficult areas. There are separate school buses. The private buses play
ply on profitable routes.
Therefore in accordance with Mahinda Chinthana even with losses,
their services will be maintained in the interest of the public.
We have institutions, such as, Kurunegala Plantations, Chilaw
Plantations and Lanka Phosphates which were incurring losses, but now
run on a profitable basis. Institutions were privatised to share the
private sector managerial skills in the development of the national
economy. I would like to ask the Opposition what alternative is there
for us to resort to other than taking over these assets, if they are not
properly managed and have failed to earn profits?
You have also made the allegation that we might acquire temples,
private houses and business enterprises as well. We have never acquired
any temples, but really developed them. It was the UNP which acquired
and barricaded the Getambe temple and the Gampaha Saama Maha Viharaya of
Ven. Daramitipola Rathanasara Thera.
Private assets
Then it was Ranasinghe Premadasa who acquired the residence of
Minister Mervyn Silva. The entire stretch of land from the residence of
Veteran Ayurveda Physician Pandit William Alwis upto the Duplication
Road was taken over by the UDA to put up the Lucky Plaza.
Not only such properties, they also acquired the land where Premasiri
Stores was housed, Andrew Donald’s premises where Unity Plaza is located
and the die-hard UNPer Jinadasa Mudalali’s land at Warakapola, alleging
that he displayed only the photographs of D.S. Senanayake, Duddly
Senanayake and Rukman Senanayake but not that of J.R. Jayewardene. Who
took over the media? Did they not take over the media institute of Ranil
Wickremesinghe’s brother Shan Wickremesinghe? All these were taken over
by the UNP.
On behalf of the President, the Cabinet would like to give you an
undertaking that we will never take over any private assets. Private
sector includes even the pavement hawkers for whom we have provided
self-employment to protect them as part of the private sector. Here are
a few facilities provided to the private sector by the government.
Recently, when the entire global banking system collapsed, it was
imminent that we would face the same danger faced in Sri Lanka.
Thousands of Seylan Bank employees were kept on agonising suspense due
to the fear of loss of employment. The depositors were equally affected.
However, due to the direct intervention of the President, within 24
hours the Bank, its employees and depositors were relieved and
protected.
Tax reforms
The entire banking system was strengthened. That was the biggest
relief provided to the private sector. People know that so long as the
President is in power, their investments in banks are quite safe. What
was the fate of Pramuka Bank? The depositors were in an imbroglio. We
reconstituted the bank as ‘Sri Lanka National Savings Bank’ and won the
confidence of all depositors.
We gave the fertiliser subsidy to the farmers. When the tea industry
was in dire straits, we provided the fertiliser subsidy to the tea small
holders of less than five acres. We also reduced their electricity
tariff and wrote off the interest on their loans.
They were also benefited by the increased tea prices due to the
application of fertiliser. Since May 1 this year, the fertiliser subsidy
was extended to rubber and coconut estates as well. Sugar cane
cultivator and sugar-cane companies too were benefited by the fertiliser
subsidy. What was the relief package provided to the tourist industry
when it was in perilous straits? The government directly intervened and
reduced their electricity tariff; loans were written off; special
interest-free loans were given to them.
Wide tax reforms were introduced for the first time after 1977.
Thirteen items were deleted from the list of taxes since April this
year. Interest rates were also reduced to 14 percent to help them
wriggle out of the crisis. One doctor remarked that he could save Rs.
7,000 on the interest of his housing loan alone.
We have also ensured the security of investments as well as foreign
aid by an Act of Parliament.
Budget deficit
We have also provided relief to rice-mill owners. Four years ago, the
small-scale rice mill owners at Marandagahamula in the Gampaha
electorate were in turmoil when their industry collapsed. As a relief
measure, their loans were written off and fresh loans on low interest
were provided to strengthen storage facilities.
We also improved the lot of local construction companies having de-monopolised
the field dominated by a few foreign construction companies.
Consequently, today, our local construction companies are in a position
to tender for World Bank, Asian Development Bank and JEBIC-funded
projects. Then there is the World Bank-sponsored system of Business
Ranking to judge whether the environment in a country is conducive to
investment. Sri Lanka ranked 98 in 2011 from 104 and today it is 89 in
the overall ranking. In the sector-wise ranking such as starting a
business, dealing with construction permits, getting electricity,
registering property, getting credit, protecting invertors, paying
taxes, trading across boarders, enforcing contracts and resolving
insolvency, Sri Lanka has advanced to 46 from 74 in protecting
investors.
The inflation rate too has drastically come down from 26 to a simple
digit, five during the previous month. We have also narrowed down the
budget deficit. No country in South Asia, except Sri Lanka, has been
able to supply electricity throughout 24 hours, seven days of the week
and 365 days of the year!
Under the President’s Mahinda Chinthana, not only the mega
entrepreneurs, but the small-scale trader, owner of a tea kiosk,
three-wheeler driver, ‘DIMO Butta’ driver and even the pavement hawker
were equally guaranteed of security of business.
Restoration of peace after the liberation of the country by the
Mahinda Rajapaksa government is the biggest achievement which benefited
the business community. We have ensured the right of every citizen for
free movement from Dondra to Point Pedro irrespective of ethnic,
religious or caste differences.
Our war heroes made the biggest investment with the sacrifice of
their precious lives. From the supreme legislature, I would like to
assure the private sector of this country that the Mahinda Rajapaksa
government would do its utmost to safeguard honest businessmen and their
investments as well as their future progress. We will provide maximum
support to our local investors while encouraging them to ensure
high-level foreign investment into the country. We shall protect our
people, the country’s environment, national heritage and customs and
provide full protection to the investors.
On behalf of the government, I would like to appeal to you to extend
your support to this Draft Bill. This Bill aims at protecting the under-utilised
and underperforming public property and utilising it for the well-being
of the people of this country. Your support is necessary to make use of
such assets to provide employment and ensure the country’s development.
Concluded |