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Legal action to recover loans from local councils
View(s):Legal action is to be taken against local bodies which have failed to repay their loans, Local Government Minister Faiszer Musthapha said. At present 18 local bodies owe Rs. 659 million to the ministry. These funds were channeled through the Local Government Loans for Development Fund (LLDF), he said.
The minister said he had directed officials to take legal action to recover the money from the local councils. Ministry Secretary Kamal Padmasiri said a letter of demand would be sent to the councils as a first step asking for an explanation as to why they had failed to pay the loan instalments.
The minister said more than 25 local bodies were not generating enough revenue and steps would be taken to streamline their development work.