Fireworks at COPE

• Major rifts appear over Central Bank Bond report, presentation to Parliament later this week
• COPE Chairman Sunil Handunetti walks out in protest, says UNP MPs pressured Auditor General to change findings
• UNP proposes stunning recommendation for CBSL report: demands criminal investigation into Perpetual Treasuries
• UNP MP Mohamed Mahroof appointed temporary chair of COPE
• UNP denies trying to protect ex-CBSL Governor; claims other recommendations will be equally forceful
• Watchdog committee sits for marathon 10 hours; UPFA, JVP, TNA MPs absent

By Dharisha Bastians

Fireworks ensued at the meeting of the Committee on Public Enterprises (COPE) yesterday, with Chairman of the oversight body stepping aside in protest against UNP members allegedly exerting undue influence on a draft report on the Central Bank Treasury Bond issue and delaying the report’s presentation to Parliament, which was initially expected today.

COPE Chairman Sunil Handunetti walked out of the meeting, when the committee sat for its third day of deliberations on the report on its investigation into the Central Bank Treasury Bond auctions in 2015-2016. COPE members now expect the report to be presented in Parliament later this week.   

The COPE Chairman, who is a member of the Opposition JVP, said he had told UNP MPs who were the only parliamentarians present at yesterday’s deliberations to appoint their own temporary chair as he was unable to sit through the proceedings any longer

COPE Chairman Sunil Handunetti

and give the final draft its seal of approval.  

The COPE Chairman said that he was still obligated to present the COPE report to Parliament, which he would do once the UNP members conclude work on the draft. “I can’t draft a report in accordance with how the UNP wants it, so I could no longer sit in the meeting,” he said. Handunetti said he had been part of the deliberations from 10 a.m. to 5 p.m.

 “I requested them to appoint a temporary chair of their choice and draft a report according to their preference,” Handunetti said after he left the meeting.

 Accordingly, UNP MP Mohammed Mahroof was appointed temporary chair of COPE for the Central Bank deliberation.

“One group of COPE members has completely consented to the draft report. However, the discussions on this report have gone on for three days with UNP members suggesting amendments to the draft. Finally they also tried to influence the Auditor General to change his findings and conclusions,” Handunetti said after he left the meeting. 

The COPE Chairman said he had urged the UNP members to refrain from exerting pressure on the Auditor General. “If there were sections of his report they disagreed with, they could have noted their dissent in the report, but they could not try to influence the Auditor General to change his findings,” the JVP MP noted. 

Handunetti’s departure was “unfortunate”, said one UNP MP in COPE who did not wish to be named. The COPE Chairman had been accommodating and willing to discuss the draft report until last evening, the MP told Daily FT. “I think he was under major pressure from his party to walk away,” the UNP Member said.

Vehemently denying that the UNP was attempting to protect former Central Bank Governor Arjuna Mahendran, the UNP COPE member said that it was the group of UNP MPs yesterday which had recommended a criminal investigation into Perpetual Treasuries – the primary dealer linked to the former Governor’s son. The recommendation will be included in the final report to be tabled in Parliament, the MP told Daily FT.

Further recommendations proposed by COPE – now virtually an oversight committee comprising only UNP MPs – would surprise people who allege the UNP MPs were attempting to protect “crooks”, the COPE member from the ruling party charged.

Still speaking confidentially, the UNP MP denied their group had attempted to influence the Auditor General to change his report. “It was just a discussion. At one point, we asked him to add a sentence, referring to the fact that accepting more bids during a Treasury Bond auction than initially offered had been a regular practice over many years,” the MP noted.

The UNP was primarily taking issue with the fact that the Auditor General’s report was suggesting that former Bank Governor Arjuna Mahendran had been wrong to hold an auction to issue treasury bonds instead of opting for private placements, the MP said. The UNP MP added that in fact the Monetary Board of Sri Lanka had only granted permission for private placements between January and December 2008, while auctions were the accepted practice for issuing treasury bonds.

On the third day of deliberations yesterday, COPE sat for nine hours in total after marathon seven and 11 hour sessions last Thursday and Friday. After Chairman Handunetti’s departure, the Committee continued sittings with the temporary chair, with UNP members, the COPE Secretariat and the Auditor General participating in the deliberations. UPFA, JVP and TNA MPs in the 31-member oversight committee did not attend yesterday’s meeting. Joint Opposition MP Chandrasena Gajaweera attended the meeting very briefly, Daily FT learns.

Speaking to reporters last night, COPE Chairman Handunetti said he had discharged his duties responsibly and without bowing to pressure or influence as Chairman of the watchdog committee, and added that he had no personal interest in going after individuals. “My only interest is to protect public funds and our only investigation was about whether this transaction had taken place with minimum loss to the Government or not,” the COPE Chairman noted.

To accuse the Auditor General of pursuing a political agenda was a grave charge, the COPE Chairman said. “He is not just an individual. He holds office as the Auditor General of the country. We have to protect this office and we cannot allow it to be belittled or insulted,” the JVP member said.