Budget bust!

Friday, 17 October 2014 00:40 - - {{hitsCtrl.values.hits}}

UNP charges Govt. hiding accurate spending to provide Budget facelift
Outlines examples and appeals to stop the “foolish” measure

UNP MP Dr. Harsha de Silva shows off the 2014 Appropriation Bill at yesterday’s press conference at Siri Kotha - Pic by Shehan Gunasekera By Uditha Jayasinghe As the days count down, the main Opposition yesterday appealed to the Government to present a constitutionally-valid Budget without hiding or changing State expenditure on balance sheets. United National Party (UNP) Dr. Harsha de Silva told reporters the “good news” in the Budget such as decreasing external debt and deficit were largely manufactured by the Government but hiding true levels of State expenditure. Taking examples, he outlined how details filed in the Budget fail to tally with projects carried out by the Government. “One example is funding in the Budget of 2014 allocated for the building of the Secretariat for Personal Identification being built by the Defence Ministry. In the Budget from 2014-2016, funding allocation is Rs. 110 million but the Defence Ministry website reported the total cost is Rs. 7.5 billion. This is a huge difference,” he stressed. Dr. de Silva charged that the Government was borrowing from unknown sources and carrying out transactions outside of what is specified in the Budget. He insisted Parliament is empowered to manage all money coming into the Consolidated Fund and therefore the Government’s actions were unconstitutional. He also pointed out how State and private banks were lending money to the Government for massive road building projects but the agreements usually signed between the Road Development Authority (RDA) and the respective institutions are at a higher interest rate and details are not included in the Budget. Another example mentioned by him was park to be built in Bellanwila at a cost of Rs. 14 billion but in the Budget provided only Rs. 1.8 billion. “Such off-balance expenditure is extremely dangerous as then no one will know the real state of the country’s economy. This is simply us fooling ourselves. The Government must stop doing this immediately.” In the upcoming Budget, the Government plans to reallocate or change prior approved funds to Government institutions worsening the already opaque accounting system, he went on to say, alleging the changes are likely to assist the ruling party in elections widely expected to be held early next year. Noting that the time allocated for Budget debate had been trimmed this year, he noted the Opposition had no real power to demand transparency and accountability in Parliament as Sri Lanka moves further away from a functioning democracy.

UNP demands transparency in refinery expansion deal

The United National Party (UNP) yesterday charged the Government was preparing to hand over the lucrative Sapugaskanda Oil Refinery expansion to a Chinese company, disregarding a much cheaper and reputed US company option. UNP MP Dr. Harsha de Silva insisted the Government is preparing to disregard a tender of US company Bentec, which had agreed to undertake the expansion at $ 1.5 billion in favour of a Chinese company that would allegedly charge $ 2.2 billion. The Government proposes to double the capacity of the refinery from 50,000 barrels a day to 10,000. “This is a national travesty. We appeal to the Government to think of the country rather than the personal agendas of a few powerful people. It is the people who have to pay for these mistakes. Do a technical evaluation and then decide,” he said. Dr. de Silva also noted several multinationals had bid for the project including Germany’s Maritech, South Korea’s Keangnam and a Romanian company. However, he said Bentec had been selected by the tender committee as the best bid, but powerful members within the Government were not planning to handover the project to the Chinese. “We have already seen the results of Norochcholai. If this project is also handed over to the Chinese, it will become a big headache. This is supposedly the biggest foreign contract the Government is planning to date and it should be done transparently in the interest of the nation.” In early 2013 the modernisation project ran into a hurdle and the Sri Lankan Government has requested Iran to reconsider its conditions on financial commitments of both countries imposed in the Memorandum of Understanding signed in 2008. The financial hurdle followed a feasibility study conducted by KBS Technologies of Singapore, which had estimated the project cost to run up to $ 2 billion. Earlier it has been estimated at $ 1.5 billion but funding by Iran fell through after the ally put a condition on Sri Lanka to commit $ 500 million, which is 30% of the total cost. With the new cost, the Sri Lankan Government’s share went up to around $ 667 million resulting in the Treasury disapproving the deal, media reported.

Provide fair payments in Budget

UNP MP Dr. Harsha de Silva also spoke up for the public sector yesterday, calling on them to support the Opposition in upcoming elections and calling on the Government to provide fair incentives to pensioners. He questioned the disparity between public workers and pensioners, pointing out inflation affected everyone in the same way. He demanded a transparent structure for increasing pensions in line with Government increases on pay and allowances to State employees. “The UNP stands by a Rs. 10,000 increase for all State workers. But the Government also owns pensioners a payment increase in a sustainable manner and not just as an election hangout, he said.