The Political Column
5th April 1998
By our Political Correspondent
The government has claimed a suc cessful conclusion of the AirLanka restructuring programme, a process which started in August 1995 but the whole deal has run into a thunderstorm.
According to the government announcement, AirLanka will embark on a US $500 million refleeting programme and is also to invest US $15 million for the upgrading of its catering services.
As part of the restructuring, AirLanka sold 40% of its shares to Emirates Airlines for US $70 million. Under the new agreement Emirates will also take over the management of AirLanka.
Financial experts point out that the amount paid by Emirates is even less than the 1995 valuation of US $85 million.
Even of the $70 million, the government will get only $45 million as an immediate payment and the balance within two years.
However, the government states that the total financial benefit reaped from this joint venture is around US $126 million well above the government valuation of US $86 million and the US $50-80 million range valuation given by the Financial Advisory Group comprising SM&E Chase, Manhattan Bank and People's Merchant Bank.
A week before the controversial AirLanka deal was signed, President Kumaratunga summoned AirLanka Chairman Harry Jayawardena to Temple Trees.
She said she wanted to reappoint him as the Chairman of AirLanka, after the restructuring. Mr. Jayawardena said he would think about it. But by this time the board meeting scheduled for Friday last week had been cancelled.
On Monday morning, the President once again told Mr. Jayawardena that he would be appointed the Chairman. Mr. Jayawardena agreed and he was so appointed.
During the conversation the President mentioned a few other names, including Kusumsiri Balapatabendi, Dixon Nilaweera and a London based accountant, who was said to be an associate of the President's confidante, Mr. Ronnie Pieris to be appointed as directors.
However, the surprised third person was dropped. The same evening, a meeting of the board of directors was summoned. During the meeting, Deputy Secretary to the Treasury and PERC Chairman P.B. Jayasundera, walked in armed with the AirLanka-Emirates agreement.
He requested the board members to formally ratify the agreement.
When there appeared to be some reluctance among the directors, Mr. Jayasundera said the agreement had been approved by the Cabinet and the directors of AirLanka had to formally ratify it.
But the directors who were obviously wary about the risk of placing their signatures, requested Dr. Jayasundera to make an endorsement in the agreement that the draft had already been approved by the Cabinet before the directors signed it. The AirLanka deal has raised many important questions.
DUNF Parliamentarian Ravi Karunanayake has written to the President seeking clarification on vital issues.
At a meeting of the Committee on Public Enterprise (COPE) recently, Mr. Karunanayake questioned the Treasury and PERC officials as to whether they had finalised the matter and a Cabinet paper forwarded. But there was no complete response from the officials and he alleges that the state officials had suppressed the truth from the Parliamentary Committee.
Mr. Karunanayake has now written to the Chairman of the COPE with a copy to the Speaker on the conduct of these public officials.
The matter is likely to go before the Privileges Committee. It was evident that Aviation Minister Dharmasiri Senanayake had submitted a Cabinet paper in this regard under his signature but Minister Senanayake was out of the country when the matter was taken up by the Cabinet.
At the weekly meeting of the ministers held on Wednesday, Batty Weerakoon referred to the draft agreement to privatise the phosphate deposits in Eppawala.
President Kumaratunga said that introducing amendments to the draft agreement would be a long procedure which would delay the privatisation of the Eppawala deposits.
The President explained that the ministers wouldn't like to delay the process and if that happens the government would lose. In the circumstances the President asked Mr. Weerakoon as to whether he could help her by proposing a minimum number of amendments to the draft agreement.
Mr. Weerakoon disagreed and said he could not do that. So it was not possible to discuss this matter on that Wednesday.
Later the President said that she would allocate a special date for this discussion and told the ministers that they should come prepared to discuss the draft agreement. At the same time the Cabinet reviewed the South Asian Free Trade Area (SAFTA) agreement and approved it after several ministers moved amendments.
However, it appeared that Minister Kingsley Wickramaratne was not happy with his colleagues since he thought that the amendments would create problems for him.
Minister D.M. Jayaratne and Mahinda Rajapakse moved most of the amendments and reduced the number of subjects that should come under SAFTA.
The minister also discussed the current political situation in the country and the role of some monks.
Minister Maithripala Sirisena referring to the Venerable Maduluwawe Sobitha Thera alleged that the monk was buying paddy from the farmers. Some ministers thought that it is an organised move to thwart the efforts of the CWE which is purchasing paddy from the farmers in Polonnaruwa.
Some ministers alleged that Ven. Sobitha Thera is doing so under the patronage of two big businessmen, one running a jewellery business and the other a garment factory. The President asked acting Minister of Cultural Affairs A.V. Suraweera to find out as to whether the Code of Conduct for Buddhist monks had been changed.
The President also wanted to obtain a ruling from the Mahanayakes over the matter. The ministers think that the organisation run by the Ven. Sobitha Thera had made it difficult for the minority businessmen dealing in paddy and rice.
At the same time, the President expressed displeasure over another Buddhist monk involved in Trade Union work.
"We must ask them whether they are allowed to do business and lead Trade Unions. She told Acting Minister Suraweera to announce the concern of the Cabinet on the matter at the weekly Cabinet news briefing.
Many ministers thought that it was an unwise move to have enemies on all fronts.
One minister said that if Minister Mangala Samaraweera so wishes, he could announce as a comment from him, and not as something initiated by the Cabinet of Ministers. The President came to the defence of Minister Samaraweera and said, "I know that there is a group who wants to make Mangala the scapegoat."
With this the Cabinet meeting wound up but the President had a private meeting with Minister S.B. Dissanayake soon after at his request.
He had sent a note to the President while the meeting was on.
His name figured in many circles last week, after he applied for membership at the Royal Colombo Golf Club along with a businessman friend.
The normal procedure is that one has to be on the waiting list since membership of the RCGC is limited.
However, the RCGC did not reject the application of the minister. Nor did it charge him the usual Rs. 50,000 as membership fee. Instead the minister was made an Ex-officio honorary member of the RCGC.
Besides this the upcoming Provincial elections take a prominent place in the country's political scene. It could be taken as a barometer for government's popularity and as to whether the government could push through the devolution package to end the protracted ethnic war.
The government is all out to win the elections while the opposition is making its bid in all the provinces except the south. Both the government and the opposition are selecting Chief Ministerial candidates for the election.
The PA's Chief Ministerial candidate for the Western Province could well be Sunethra Bandaranaike, though she has publicly denied it and as of now.
But according to party insiders, the decision will not be announced until the last moment.
These days President Kumaratunga is making frequent visits to Rosmead Place to see her mother and to talk about the party's future.
She was thoroughly disappointed over the Kandy meeting where only a small crowd gathered to listen to her.
In her opinion this is because of the ongoing conflict between the three important personalities in the area - General Anuruddha Ratwatte, Lakshman Kiriella and D.M. Jayaratne.
She told Ms. Bandaranaike that she offered the Chief Ministerial candidacy for the Central Province to Lakshman Kiriella but he refused. Ms. Bandaranaike said it was not surprising since she felt he had been given a raw deal by the party over the years.
The PA so far has not finalised its Chief Ministerial candidates, but speculation is that present PA Chief Minister Susil Premjayantha would look elsewhere if his candidature for the Chief Minister's slot is not considered by the party.
Meanwhile, the Ganeshalingam group in the Colombo Municipal Council is collecting information to carry out a campaign against the UNP's WPC Chief Ministerial candidate Karu Jayasuriya.
Mr. Jayasuriya is widely respected and many UNPers feel that he could win the Western Province for the UNP, against any powerful candidate fielded by the PA.
As for the UNP, a decision has been taken with regard to the Western Provincial Council. UNP leader Ranil Wickremesinghe too had appointed several organisers to the constituencies within the Colombo Municipal limits. He had made a clever move by appointing M. E. H. Mahroof as the organiser for Colombo Central. Thus he had enabled the UNP to move Mr. Mahroof out of the Sirisena Cooray camp and strengthening Mr. Wickremesinghe's position in the Colombo Central.
The main problem the UNP faces in Colombo is Hema Premadasa the widow of the late President Ranasinghe Premadasa. She makes a strong claim for Colombo Central, but so far the UNP had not responded favourably to her claim.
If her bid for Colombo Central is not entertained she has threatened to contest the Presidential election. However it has now become a matter for the UNP to consider seriously.
Meanwhile the UNP Parliamentary Group met on Monday in the Parliamentary complex amidst the Wijeyapala Mendis crisis and the Ronnie-Anura fight.
At the very start, Mr. Wickremesinghe said the UNP's decision to boycott Parliament was to register its opposition to the government's denial of the rights of the opposition. He said the boycott was now being suspended but he was putting the government on notice that the UNP would consider further action if the government continued to harass the opposition and prevent it from performing its functions.
Regarding the Wijeyapala Mendis problem he said he had discussed the issue with the members and he was still available for the next two weeks if MPs wanted to see him on this subject.
He said that Mr. Mendis had written to all MPs, explaining his position though some may not have received the letters in view of the postal strike. He said that the matter would be taken up by the group early next month. In any case, he said that since the group had already mandated him, he would make the final decision.
It is now reported that the Mendis matter is likely to be resolved shortly since he had expressed his willingness to step down on certain conditions.
The formula has been devised by Mr. Mendis himself. He has apparently told the party hierarchy he is willing to step down if his brother-in-law Dr. Kamal Karunanayake is appointed as the UNP organiser for the Katana constituency.
The UNP hierarchy had apparently accepted this formula as a solution to the present crisis.
Mr. Mendis who is likely to leave for London on Thursday is expected to send in his resignation from there. With this in mind UNP leader Wickremesinghe has put off the Working Committee meeting scheduled for tomorrow and he too is planning to leave for China on April 11. The Working Committee meeting therefore will be held during the second half of the month, after Mr. Wickremesinghe returns.
At the same time the UNP leader is now trying to find out whether several UNP MPs had a meeting in Colombo to muster support for Mr. Mendis.
Several names have been mentioned including that of Earl Gunasekara.
The UNP membership was awaiting more details of the meeting to determine what action should be taken against such errant members of the party. At Monday's group meeting former Foreign Minister A.C.S. Hameed made an important point.
He said the practice of a full day emergency debate should not be changed since this debate gave MPs an opportunity to air their views about current and future problems. He said that for the emergency debate on Tuesday the government had fixed half a day for the debate since the opposition was not present at the Party Leader's meeting, but stressed that the existing practice should continue.
The group also agreed to a suggestion by Mr. Hameed that the government should ask that the Anti-Ragging Bill be referred to a Standing Committee so that the full implications can be examined in detail.
Mr. Wickremesinghe said the party was opposed to ragging and that he agreed with Mr. Hameed that we should look at the causes that lead to ragging and not only for punishment after the event. He also said the Standing Committee could report back within a short period.
The group also discussed the postal strike.
Different views were expressed. Whilst MPs John Amaratunga and A. H. M. Azwer condemned the minister for not intervening and settling the strike and leaving it to his deputy to handle this serious issue, trade unionist Gamini Lokuge was not prepared to let down his side. He argued in support of the strike and called for support from the party for the cause of the workers. Mr. Wickremesinghe, however, kept the discussion on track and said the people came first in all such situations.
A number of MPs spoke at length on the government's decision to deprive the Janasaviya recipients of their Rs. 250 entitlement. The party leader said Sarath Ranawake was heading a Committee on the subject and would report to him on steps to be taken in the future.
Colombo District MP Mr. Premaratna Gunasekera referring to the duel between Ronnie and Anura praised Mr. Wickremesinghe for having brought about a settlement between the two. But the final cost of the conciliation fell on Kandy District MP A. R. M. A. Cader. He was asked to host a dinner to celebrate the reconciliation. According to some MPs the duel is far from over and both parties are still sharpening their knives. Ronnie de Mel had come to the Group meeting armed with 12 deeds pertaining to alleged land transfers by the Bandaranaike family after the Land Reform Law was passed. Many MPs chose to distance themselves from both Ronnie and Anura, while some of the cheer squad members have already been pulled up by the leader of the party and warned not to aggravate the conflict.
Mr.Wickremesinghe also made it a point to ask Sajith Premadasa as to why he issued a statement supporting Anura Bandaranaike. Mr. Premadasa gave a long explanation saying Mr. Bandaranaike had personally helped him.
Mr. Wickremesinghe then told him that he could continue with his relationship with Anura but advised against issuing statements on such conflicts. Apart from the business of the day, Mr. Wickremesinghe also referred to the Batalanda Commission Report.
He said that if the government was prepared to sling mud he would reciprocate equally. It now appears that the government is planning to get maximum political advantage out of the Batalanda Commission Report. So much so Presidential Secretary K. Balapatabendi cautioned Justice D. Jayawickrama against releasing a synopsis he prepared to the media. When Justice Jayawickrama asked Mr. Balapatabendi whether to release the synopsis to the press he said they would do it at the correct time.
Mr. Wickremesinghe's position in this regard, appears to be clear and he had told his confidantes that he could defend himself and come out of it without much of a problem.
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