plays up, but Govt. pays up to Prima
By Sachithra Mahendra
The Government has agreed to pay a thumping Rs. 5,000
million to the Prima Company as subsidies after a long battle which
led to flour shortages, temporary closure of nearly 100 bakeries
and bread price increases.
cabinet this week approved the payment, despite protests by Consumer
Affairs Minister Jeyaraj Fernandopulle who asked for more bank guarantees
for his ministry to make flour imports.
Fernandopulle told The Sunday Times he had objected to the payment
of subsidy to Prima, pointing out that a shipment of flour from
Malaysia was on the way to meet the shortage.
said that 10,000 metric tons of flour would be imported with the
first shipment due on January 7. Mr. Fernandopulle said he took
up the position that instead of paying a private company the subsidy,
it would be better to provide the facility to the state sector so
that they could handle imports on their own.
Prima company spokesman said the government had agreed to pay the
subsidy with arrears from February this year, after talks with Treasury
spokesman denied allegations of short-supplying the market and said
that they were releasing about 2,000 tons a day to the local market
while exporting only 400 tons a day.
on Wednesday the Government sent in two officials from the Consumer
Protection Authority (CPA) to visit the Prima storage facility,
in Trincomalee to inspect the flour stocks.
Chairman M. Musheen told The Sunday Times that the team was sent
to inspect whether the shortage was due to hoarding. He said he
was awaiting a report from the team which visited the stores.
islandwide had been affected by the shortage of flour during the
past two months with about 100 bakeries being forced to close down
on a temporary basis, according to the President of the Bakery Owners’
standoff between the government and the Prima company began soon
after the UPFA government came to office in April. Minister Fernandopulle
had demanded that the company submit the required documents for
the payment of arrears, but later rejected the payment on the basis
that the documents were not in order.
then Singaporean Prime Minister Goh Chok Tong during his visit to
Sri Lanka also took up the issue with the government.