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Tuesday, 24 February 2015 01:25 - - {{hitsCtrl.values.hits}}
Employee protests at onetime Lankan handloom giant Lanka Salu Sala, concluded abruptly on 19 February, after Industry and Commerce Minister Rishad Bathiudeen visited the site and spoke to protesters.
The workers alleged that the losses at Salu Sala were such that at times its merchandise was given to outsiders completely free with a label which read ‘sold at 100% discount’
“We now have to decide whether to revive and continue Salu Sala or to close it down since we cannot go on this way. Within one month I am going to terminate all such cases,” Minister Bathiudeen said while addressing protesting union leaders and employees of Lanka Salu Sala, the State-Owned Business Enterprise (SOBE) and producer and seller of handlooms, at its head office. Deputy Minister Champika Premadasa was also present.
Lanka Salu Sala Ltd. has become a ticking fiscal time bomb and is only a shell of its former self, now claiming a mere two land plots of around 100 perches to its name. The head office complex at Jawatte Road is not owned but rented and its huge showroom, mini garment factory and warehouses are all dilapidated and neglected.
Its network of showrooms across the country too is formed of complexes that have all been obtained on rent. One of its key former functions was the import and distribution of school uniform material to Sri Lanka and the transfer of this operation dealt another blow to its stream of income.
The union leaders and workers of Salu Sala informed the Minister of many alleged corrupt activities and operational irregularities.
These included allegedly allowing workers who did not possess the necessary authority to handle merchandise and stocks. The employees said that as a result of this, once Rs. 2 million worth of stocks went missing, a fact confirmed by an audit report.
And its original brand image now stands tarnished, though it is publicised as Lak Salu Sala, the official name of the institution is still Lanka Salu Sala Ltd. and the usage of officially non-sanctioned ‘Lak Salu Sala’ eroded the original Salu Sala brand image considerably.
Certain workers were also purported to have been paid a commission fee for material procurement for Salu Sala, contrary to standard state procurement practices.
“I am also looking into combining Laksala and Salu Sala so that a joint operation could help its revival,” Minister Bathiudeen said.
He added: “I instruct the new Chairman of Salu Sala to take note of all the issues raised by the employees and produce an investigative report. The pledge by President Maithripala Sirisena and Prime Minister Ranil Wickremesinghe is for good governance and therefore freeing this institution of its corruption and malpractices is now a priority. The new Chairman K.K. Chandrasiri, who is the former Secretary of the Water Board, will also need to visit all the sites under Salu Sala and inspect them immediately. “I understand that worker unions here have many demands but winning demands from me alone is not sufficient. You should also perform your duties and serve the country. I urge you to give your support to the new Chairman so that we can get this institution back on track. From 218 employees, 209 agreed to the voluntary retirement scheme. I shall also enlist Finance Minister Ravi Karunanayake to help resolve your EPF non-payment issue.
“If investors are there I am sure that Salu Sala can be revived and made profitable on a Public Private Partnership basis but for that we need to clean this place up first. Continued political interference in Salu Sala is one of the reasons for its current problems. I have been told that of the 218 workers, there are 71 Salu Sala workers now staying at home for months on end while their salaries continue to be paid in full. We cannot continue to pay any Salu Sala worker while they stay at home and do nothing. Within one month I am going to terminate all those who are paid salaries but not reporting to work if they do not return to duties immediately. If any irregularities are highlighted in next week’s report by the new Chairman and the management committee, I shall take strict action no matter who is responsible. I look for your support to achieve this.”
Salu Sala losses continue to mount. According to the draft income statement of Salu Sala for the financial year 1 April 2013-31 March 2014, it incurred a net loss of Rs. 14.8 million, down from Rs. 57 million from the previous financial year ending 31 March 2013. Among the annual costs of FY 2013/14, salaries and wages were at Rs. 63.6 million, total overtime was billed at Rs. 1.1 million and travelling allowances at Rs. 2.48 million.
The Salu Sala Union leaders and workers gave their support to the Government’s anti-corruption efforts. “From now onwards we shall display good discipline and behaviour and support the goals of the Government as well. The staff loans recovered by Salu Sala from our salaries are not channelled back to respective lending banks so that our members are locked inside the CRIB. For years we have been building this institution together with the contribution of all employees despite their party and political affiliations but creeping political interference damaged this institution. The alleged activities that took place here lately resulted in the wastage of valuable public and Treasury funds and we are pleased that all such practices are ending today with Minister Bathiudeen’s visit and quick action, including the appointment of a new Chairman,” Union Leader K. Namali Thalpawila, who has worked at Lanka Salu Sala Ltd. for 32 years, said.
