There will be no joint May Day rally but SLPP will go it alone Dispute over ETI deal may explode like the CB bond scandal as CB and NEC officials argue   A relative lull in political activity this week does not mean woes are receding for President Maithripala Sirisena, the Sri Lanka Freedom Party [...]


SLFP-SLPP joint committee to discuss common alliance

By Our Political Editor

  • There will be no joint May Day rally but SLPP will go it alone
  • Dispute over ETI deal may explode like the CB bond scandal as CB and NEC officials argue


A relative lull in political activity this week does not mean woes are receding for President Maithripala Sirisena, the Sri Lanka Freedom Party (SLFP) leader, and his United National Front (UNF) government. They are now poles apart.

On the contrary, some issues are exacerbating. One is threatening to explode. Paradoxical enough, this also involves the country’s same premier banking institution.

In the former bond scandal, a forensic audit is yet to get under way despite President Sirisena’s directives. A debate on the subject in Parliament remains in limbo. So does action against those accountable. The most wanted man Arjuna Mahendran, the former Governor of the Central Bank, is still a fugitive from the law. This is despite a request by President Sirisena, whilst in Singapore to Premier Li Hsiang Loong to send him to Sri Lanka to face charges. He handed in a dossier on this banker’s allegedly fraudulent activities.

Amid political alignments and realignments in this year of election, protagonists met at the BMICH ceremony to mark Finance Minister Mangala Samaraweera’s 30 years in politics. Mr. Samaraweera is seen in conversation with former president and the SLPP’s de facto leader Mahinda Rajapaksa, while President Maithripala Sirisena and Prime Minister Ranil Wickremesinghe were watching the proceedings. Pic by Sameera Weerasekera

And now, it is the sale of Edirisinghe Trust and Investments (ETI) to Sri Lankan born now British businessman Subashkaran Alirajah. The founder and chairman of Lycamobile, a telecommunications company besides others, he is widely known as one of the underwriters of Britain’s ruling Conservative Party with large cash donations. According to the British The Sunday Times, the net worth of this controversial businessman in 2014 was 475 million Sterling Pounds.

It was last week that President Sirisena told the Sunday Times he could not continue with the so-called national government since the UNP was “not clean”. He said the latest is the deal involving the sale of Edirisinghe Trust and Investments (ETI) where the Central Bank had a big stake. The CB had moved in to pump money to prevent the collapse of that company.

Last Tuesday, President Sirisena who chaired a meeting of the National Economic Council (NEC), warned that the proposed deal, yet to be finalised, would become a serious issue in the future. Prime Minister Ranil Wickremesinghe, under whom the Central Bank functioned previously, and Finance Minister Mangala Samaraweera, who is now in charge, were both absent from the meeting.

The NEC replaced the Cabinet Committee on Economic Management (CCEM) chaired by Premier Wickremesinghe in August 2017. President Sirisena strongly believes that the ETI deal lacked transparency and raised a number of questions over the way it had reportedly been rushed through. He also believes there was strong lobbying by interested parties within the government and this edged out local investors. Some well-known UNF members, including those who wielded stronger power before, are being mentioned as beneficiaries.

NEC-CB disagreement

In essence, the ETI sale has been placed at US$ 75 million. NEC officials claim it dropped to US$ 70 million after the buyer (Subashkaran Alirajah) chose not to buy Swarnamahal Financial Services and thus reducing his offer by US$ 5 million. Already US$ 54 million had been paid leaving a balance of US$ 16 million. The Central Bank assessment of the company providing financial services was US$ 2.9 million. However, NEC officials have challenged the basis on which the valuation of each asset had been carried out.

It seemed ironic, if not tragic, that President Sirisena, who is now personally spearheading work related to economic activity, after taking them over from his Prime Minister, is unaware how such a deal came to be formulated. Now, for the second time, he is finding himself compelled to deal with the Central Bank over another alleged irregularity. This is whilst the Central Bank is insisting it was right and there had been no contravention of any law or procedure.

The pros and cons may be arguable and are now being publicly debated. What is of significance is that such a debate is between the Central Bank on the one hand and the National Economic Council on the other. In other words, between two premier state institutions coming under the overall purview of the President. That raises an all-important question — whether such issues which involved vast sums of money of the taxpayer continue unabated and why no action is possible when there are allegations of blatant wrongdoings. Even more damning is how for four long years, the two key partner leaders of the so-called Yahapalanaya or good governance government, President Sirisena and Premier Wickremesinghe, are continuing to point fingers at each other. This has overshadowed development activity and added to public confusion.

This is in the backdrop of similar situations piling up. More finance companies are now in trouble. The ETI deal became the subject of a ‘fact finding’ study by the National Economic Council. “We came into the picture as fact finders. We did discover several problem areas,” Professor Lalith Samarakoon, Director General and Chief Economist of the NEC, said. Such issues, he noted, were brought to the attention of the President. He also elaborated on them at a news conference on Thursday, but a bureaucratic misadventure did little good for President Sirisena. There was only a Sinhala language news release with banks and other international agencies scurrying with each other to determine the government’s official position. That the issue had an impact on foreign investment was lost on the NEC brahmins. Other than study and report to the President, there is very little the NEC has been able to do. Hence, the news conference to air its lament.

One need hardly be an economic wizard or a hardnosed detective to forecast that the ETI deal, despite evidence if any, will still see the light of day in a court. This is like some of the other well-known investigations where irrefutable proof was unearthed after millions of dollars were spent on travel and foreign governments helped. It is like the pithy Sinhala saying Vetai Niyarai Goyang Kanawa Nang Kaata Kiyannada or whom to tell if the fence and the bund are eating the paddy.  This is besides the probe into the Central Bank bond scandal where many aspects have been delayed. However, there are clear signs that details of the ETI deal could transpire before the new Presidential Commission of Inquiry set up to probe bribery, corruption and other wrong acts during the tenure of the UNF. There are aggrieved parties who are making preparations for this purpose. The five-member Commission is headed by retired Supreme Court Justice Upali Abhayarathne.

Its mandate is to probe allegations of large-scale corruption between January 15, 2015 and December 31, 2018. The other four Commissioners of the PCoI are retired High Court Judge Sarojini Kusala Weerawardane, retired Auditor General Pasdunkorale Arachchige Pemathilaka, retired Ministry Secretary Lalith R. de Silva and retired Deputy Inspector General M. K. D. Wijaya Amarasinghe.

The Commission is mandated to probe the alleged “acts of corruption, fraud, criminal breach of trust, criminal misappropriation of property, cheating and abuse or misuse of power or authority, state resources and privileges” in the last four years by “persons who had held or continue to hold political office and those who have been or continue to be public servants and officers of statutory bodies.

The public response to the Presidential Commission’s call for representations has not been overwhelming. A few of the representations received are now being probed preliminarily by the Police team attached to the Commission. It is only thereafter that formal sittings will begin at its BMICH office.

In the light of the Commission being mandated to come up with a preliminary report in three months, and a final one thereafter in six months, a not so encouraging public response raises questions. Is there a public reluctance, particularly in the backdrop of other commissions of inquiry reporting their findings and no action being taken by the government? Such commissions also dealt with acts of bribery, corruption and wrongdoing. One is not wrong in alluding this situation to that of a cricket match. President Sirisena continues to bowl and the Wickremesinghe government, which is at the crease, is hitting the ball over the ropes.

This is by no means to decry Sirisena’s efforts to fight bribery and corruption. However, the past four years have seen more rhetoric than rightful responses. President Sirisena told the Sunday Times last week, “I am in the process of re-organising the Police and added that the “law and order situation should be strengthened.” Those remarks underscore an important reality – such measures should have come much earlier. If they did, there is little doubt some of the serious problems he faces today would have been obviated. One such area is the high-profile probes, a presidential and parliamentary election pledge, where investigations were compromised for both political and other reasons. Top level police officials are being accused of directing murders or alleged assassinations.

Of course, President Sirisena cannot be blamed for all the ills in the Police. Until late last year, the department came under the UNF administration. It was held firstly by Sagala Ratnayake and thereafter by Ranjit Madduma Bandara. The cavalier approach during the UNF tenure led to a key position in an institution dealing with the Police being placed in the hands of one of the wanted suspects in a high-profile investigation. Another suspect who worked with him together in the then Defence Ministry had fled the country. He had stalled his arrest thereafter claiming that he is a supporter of the ruling party, much the same way he did before as a staunch backer of the UPFA government. And now he has sought court action to prevent his arrest. Here was a case of having political support from both sides to override the laws of the land. That, too, in a case involving the illegal use of billions of rupees in taxpayers’ money.

Executive Prime Minister

On the political front, Sirisena also came under pressure amidst informal discussions by political leaders to seek a parliamentary election. This was on the basis of abolishing the executive presidency thereafter and going for an executive prime ministerial system, as revealed in these columns last week. The move did have some traction. Speakers from the United National Party (UNP), presumably outsourced by their leadership, spoke in favour at news conferences.

In addition, on behalf of the UNP, Minister Malik Samarawickrema raised the matter with President Sirisena after last Tuesday’s Cabinet meeting. The President told him that if all political parties were willing, he too was in favour of such an arrangement. Samarawickrema conveyed this to his leader Wickremesinghe.

Tamil National Alliance (TNA) leader R. Sampanthan had a meeting with President Sirisena on February 20. He raised issue over the subject and related issues including power-sharing. Sirisena replied that he would meet Sampanthan again in Parliament the next day together with Prime Minister Wickremesinghe. The issues were discussed again and it was decided to broaden the participants and have another meeting, this time on February 27. This meeting was held at the Presidential Secretariat. Some of the invitees did not turn up. They included Jathika Hela Urumaya (JHU) leader Patali Champika Ranawaka and the Sri Lanka Podujana Peramuna (SLPP)’s de facto leader Mahinda Rajapaksa. However, an SLPP source said there was no invitation for Mahinda Rajapaksa.  Also present were Rauff Hakeem, Mano Ganesan, Faizer Mustapha and Dilan Perera.

Sampanthan’s remarks over the executive presidency and the electoral system led to a heated debate. Thereafter, the discussion shifted to the subject of devolution of power.

Speaking on behalf of TNA, M.A. Sumanthiran, who was at the meeting told the Sunday Times, “The discussion was on the proposed new Constitution. As it was not possible to immediately come to a conclusion on the subjects of abolishing the executive presidency and electoral reforms, the two subjects were kept aside and strengthening devolution was discussed.  The TNA pointed out that the President had not fulfilled the promises given in the 2015 election manifesto. The President appointed a four-member committee comprising Dr Sarath Amunugama, Dilan Perera, Dr Rajitha Senaratne and myself to identify the areas which need immediate attention and to submit a paper before the next meeting.” In the absence of others, this exercise is essentially one between the Sirisena-led SLFP, the UNF and the TNA. Even if there are questions over how far it would go, there is still some significance.

The Geneva process

This is in the light of Sri Lanka’s case being taken up at the ongoing sessions of the UN Human Rights Council (UNHRC) in Geneva. President Sirisena said last week that Sri Lanka may withdraw its co-sponsorship from the United States-backed resolution on Sri Lanka. However, the issues are still being directed by the UNF government prompting no shift in Sri Lanka’s position.  Even if the TNA has not formally reacted to the remarks, the British-based Global Tamil Forum (GTF), which has been at the forefront of the campaign in Geneva criticised both President Sirisena and Premier Wickremesinghe.

Here are highlights of a lengthy GTF statement: “The recent call by Prime Minister Ranil Wickremesinghe for a process of truth telling, regret and forgiveness – without the key promises of justice and accountability, and the statement by President Sirisena that discussions were going on regarding Sri Lanka withdrawing from UNHRC commitments, therefore, are astounding, sinister and dangerous. Whether these are tactics to avert judicial accountability or bargain positions to weaken international will, or truly ill-considered steps to seclude Sri Lanka from the international processes – only time will tell.

“Letting Sri Lanka off the hook at this critical juncture without formal UN scrutiny will invariably result in the abandonment of its accountability commitments. No doubt it will alienate the Tamil community by failing to address longstanding grievances related to impunity, thus effectively extinguishing the prospect of reconciliation. It will also abruptly end the processes designed to mitigate the past UN failures and convey a dangerous message that accountability commitments for international crimes are expendable.”

A veiled GTF warning, particularly with Sri Lanka set to articulate President Maithripala Sirisena’s stance that troops had not committed war crimes, is noteworthy. This is what it said: “The time is right to consider consequences – both bi-lateral and multi-lateral – if Sri Lanka continues to repudiate its commitments. These include UN Member States exercising universal jurisdiction, particularly in the absence of the promised special court; adopting effective vetting procedures that would deny travel privileges to those credibly accused of international crimes; and targeted economic and military restrictions.

The recent constitutional crisis and resolution offers a useful model as it amply illustrated the vulnerability of Sri Lanka to external economic pressures. Our request is that failure at UNHRC should trigger alternate UN processes involving multiples of UN organs to establish criminal accountability.”

There will be no ministerial delegation from Sri Lanka for this week’s UNHRC sessions. It will be handled entirely by A.L.A. Azeez, Permanent Representative to the UN in Geneva and his staff.

SLFP-SLPP meeting

Amidst these developments, President Sirisena’s efforts to have the Sri Lanka Freedom Party (SLFP) which he leads to join in a common alliance with the Sri Lanka Podujana Peramuna (SLPP) will take more time. Contrary to wild rumours floating around early this week, there will be no one-on-one meeting between President Sirisena and Mahinda Rajapaksa, de facto SLPP leader towards this. As pointed out by President Sirisena at a previous meeting, there was no need for such a meeting,” said a senior SLFPer.

‘Joint Opposition’ partner party leaders, who last week took part in a meeting chaired by Rajapaksa, now Leader of the Opposition, at his Wijerama Road residence, had a lengthy discussion on the subject. In consultation with the SLFP leadership, they decided to appoint a joint Committee to formulate a framework for the new alliance. The SLFP side will comprise Dayasiri Jayasekera, Mahinda Amaraweera, Thilanga Sumathipala and Rohana Luxman Piyadasa. The three-member SLPP team comprises G.L. Peiris, the nominal leader of the SLPP, Basil Rajapaksa, its principal architect and ideologue, and Dullas Allahapperuma. Needless to say, that the joint committee meetings to finalise a framework for the new alliance would take time and likewise, the common alliance.

Democratic Left Front (DLF) leader Vasudeva Nanayakkara proposed a joint May Day rally of the SLFP and the SLPP, but it was not approved. Basil Rajapaksa pointed out that the SLPP was already making arrangements and it was not a good idea to disrupt them.

A more significant matter taken up for discussion at the leaders meeting was the currently talked proposal for earlier parliamentary elections as a prelude to abolishing the executive presidency. Basil Rajapaksa explained that though the proposal was seemingly good, it did not appear to be popular. He noted that there was criticism in the social media. Backing him was Dinesh Gunawardena, the MEP leader. He said it would be better for ‘Joint Opposition’ members not to be a party to any such arrangement.

However, some SLPP sources said there were other reasons, too. And those did not appear complimentary to the SLFP leadership. One was the question on what happens during government formation after an election. Cannot the President misuse his power and in an unlikely or unexpected event call upon another group to form a government?  Such thoughts, no doubt, are based on apprehensions over the President’s conduct. These sources did not hide the fact that they were conscious of the removal of Premier Wickremesinghe and ensconcing Mahinda Rajapaksa in his office in October last year — a move which the Supreme Court declared was unconstitutional. “As the architect of the party, Basil Rajapaksa has been weighing all the options before the SLPP, which he has built up as a formidable party,” a source added. On the other hand, protagonists for a common alliance said that such an arrangement between the SLFP and the SLPP was imperative if they were to comfortably win the presidential election. Hence, they say they should not delay the process over any reason.

Opposition presidential candidate

This brings us again to the question of the opposition candidate at this year’s presidential election, now only a maximum seven months away. Even if Maithripala Sirisena is still confident he may end up being the joint candidate, the prospects are nil though the common alliance may become a reality. In such an event, he may be left with only two options — one is to back the SLPP-led common alliance candidate, who, in all likelihood, will be Gotabaya Rajapaksa, the former Defence Secretary. He is yet to be formally told about his candidature though he has plunged into the campaign already. The second is for Sirisena to contest on his own. That will carry twin hazards. It will place the SLFP joining the common alliance in peril. In addition, he may end up not receiving the support of majority SLFPers. A section of his own remaining MPs have been displeased after he rejected their appeal to join the UNF and receive ministerial portfolios.

The exclusion of Nimal Siripala de Silva, the senior deputy leader of the SLFP, in the committee to negotiate with the SLPP over the common front has also ruffled feathers among some of the membership. This is in addition to all round disappointment caused by Sirisena’s decision to appoint electoral organisers to seven districts — Colombo, Matara, Galle, Badulla, Kandy, Nuwara Eliya and Ratnapura. The names were released by the Presidential Media Division and most are newcomers. The process to name others for the remaining districts is now under way. However, issues are sure to arise when the common alliance reaches fruition. That would necessitate an electoral arrangement where the SLFP would have to cede some of the seats to the SLPP. That too will remain a long-drawn process and the coming week’s budget will add to the delay.

In all these developments, President Sirisena remains in an unenviable situation, very much in greater intensity than Premier Ranil Wickremesinghe. Besides the known issues like his SLFP’s eagerness to form a common alliance with the SLPP, there will be no joint May Day rally. Prospects of being a joint candidate are out. His polls pledge of dealing with those involved in bribery and corruption has not been fully delivered. Newer cases are springing up and the time left for him is shrinking. He could blame it on the Police to some extent but there are very strong signals it could boomerang. This is because of fears of some officers breaking silence to go public and speak of political interference and how they were manipulated to play down some cases. The economy, as he says, is in a terrible mess.

The ‘strike back’ effect of all this on Sirisena, with only seven months of his presidency left, is alarmingly high. Yet, he is a home-grown politician who rose from the ranks and has so far survived many a political catastrophe. How the people of Sri Lanka and history will judge him in the next seven months, to say the least, is very critical. He still has time to turn around at least some things, but would he? That is on the lips of most of his countrymen.


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