Ex-COPE chief calls for punitive surcharge

Prof. Chaitha Herath expressing serious concerns about some state enterprises trying to manipulate government procedures at the expense of public sector financial discipline.

Former Chairman of the Committee on Public Enterprises (COPE) Prof. Charitha Herath has said the government is duty bound to prevent questionable actions of those who are at the helm of public sector enterprises.

The MP has suggested that those responsible for such actions be made to compensate the relevant enterprise for losses they cause.

Addressing the members of the Sri Lanka Audit Services Association at its 63rd AGM held at the Waters Edge, Battaramulla, early this week, Prof. Herath revealed that the state-owned Litro Gas had resorted to legal action at a cost of approximately Rs. 20 mn. in a bid to prevent the Auditor General’s scrutiny of its transactions.

Prof. Herath said that Litro shouldn’t be allowed to avoid government supervision under any circumstances.

If necessary laws had been available, a surcharge could have been imposed on those responsible, Prof. Herath said.

Pointing out that the Litro management had moved the Supreme Court in a bid to block the Auditor General, Prof. Herath said 99 percent of the shares of Litro were held by the State-owned Sri Lanka Insurance Company (SLIC).

During the first session of the 9th Parliament, the COPE inquired into the circumstances under which Litro had avoided the State auditing process for nearly two years.

Prof. Herath said, “We were finally able to defeat their attempt. Auditing resumed after the change at the top”.

In July last year, President Gotabaya Rajapaksa brought in Theshara Jayasinghe as Chairman and Chief Executive Officer (CEO) at Litro. The Viyathmaga activist succeeded Anil Koswatte. Subsequent to the change at the top, a comprehensive audit that had been undertaken on the instructions of Auditor General WPC Wickremaratne recently revealed the amounts categorised as legal fees.

Among those whose services had been obtained were Romesh de Silva, PC and Sanjeeva Jayawardena, PC, Chairman of the Monetary Board Risk Oversight Committee, in addition to being the Chairman of the Ethics Committee of the Central Bank.

MP Herath alleged that a despicable attempt had been made to make use of a line or two in the Constitution to deprive the AG of the right to audit the profit-making enterprise.

Prof. Herath asked whether some heads of public enterprises acted outside the purview of the top political authority. MP Herath called for legal provision for recovering losses due to questionable decisions taken by those at the helm of such enterprises.

The UNP-led yahapalana government rejected government auditors’ plea for provision in the National Audit Bill (NAB) to recover losses caused by questionable actions. The Parliament endorsed the NAB in early July 2018 after the removal of proposed provisions as regards surcharge.

Prof. Herath paid a glowing tribute to government auditors for accepting the challenge as well as the difficult task of maintaining financial discipline regardless of threats. The former COPE Chief acknowledged that the auditors faced intimidations, pressure as well as threats from decision makers at the highest levels of the government as well as those involved in corruption.

The National List MP pointed out that as the audit service hadn’t been accommodated within any ministry, governments tend to ignore the difficulties experienced by them. The MP stressed that the auditors served the State and not any particular government formed by a political party or an alliance.

MP Herath explained how institutions that had been independent were gradually brought under ministries over the years leaving the Parliament and the Auditor General as the only ones outside the purview of ministers. According to the former COPE Chief Litro wasn’t the only enterprise that had declared that the parliamentary watchdog committee as well as the Auditor General did not have any authority to scrutinise their transactions.