COPF Chief Harsha raises concerns over DDR

Friday, 30 June 2023 00:30 - - {{hitsCtrl.values.hits}}

MP Dr.Harsha de Silva

Committee on Public Finance (COPF) Chairman and SJB MP Dr..Harsha de Silva yesterday via twitter gave an update on the oversight of Domestic Debt Optimisation.

COPF meeting yesterday discussed the DDO plan but he said concerns were raised about the burden falling on superannuation funds especially EPF without considering the consent of members.

While banks were excluded due to existing stress and non-performing loans, the EPF/ETF, which carries most of the burden, faces potential opportunity loss and lacks a say in decisions impacting peoples’ life savings. This raises questions about equity and transparency.

Meeting acknowledged the urgency of passing DDO swiftly for success of IMF program and economic growth.

However, there is no contingency plan if foreign debt relief and primary surplus targets are not met, leaving the EPF/ETF exposed to added burden without alternative solutions.

Productive discussions were held with creditors including banks and insurance funds, who expressed relief over the proposed DDO plan. The exclusion of banks allows them to aggressively participate in the market, supporting businesses, especilally the hard-hit MSME sector.

"We appreciate the tireless efforts of CBSL and Treasury officials in stabilising and reviving the economy. However, it's crucial to address the concerns of superannuation funds EPF and ETF depositors, ensure consent and explore a more balanced burden-sharing approach," COPF Chief said.

Today COPF will meet again to reach a coconsens and proceed to Parliamentary debate tomorrow.

"We'll also brief non-COPF members for better understanding and fruitful debates this weekend," said Dr. de Silva in his update on the crucial DDO.