Amidst no faith motions more prospects of early LG polls

 

By Gamini Abeywardane

The week began with the much waited climax in the Treasury Bond saga with none other than Prime Minister Ranil Wickremesinghe giving evidence before the Bond Commission on Monday. It was an unprecedented development where the country’s prime Minister had to fall in line with a presidential commission of inquiry appointed by the very administration in which he himself is an important component. To that extent, it displayed the true nature of the democratic environment prevailing in the country, in contrast to what Sri Lankans witnessed in the last several decades.

The commission being only a fact finding exercise, as usual, it will end with a formal report with certain recommendations. There is a long way before anyone can be found guilty of any wrongs and legally punished. Even if any legal process is to be carried on in that direction, it has to be an entirely a different exercise and a time consuming one.

Some of the SLFP Ministers who were among those pressurizing President Sirisena to appoint the Commission of Inquiry into the controversial bond issue apparently were elated that they managed to get even the Prime Minister before the commission and expose some of those from the UNP camp who were responsible for the alleged fraud. Both the Joint Opposition and the JVP apparently tried to claim the credit for getting a Commission of Inquiry appointed to look into the matter.

There have been sensible debate as well as mere political mudslinging and empty noise over the issue. Although final result of this exercise is not predictable much damage has been caused to those who are accused of involvement in this scandal, the worst affected being former finance minister Ravi Karunanayake who has been already sent to political wilderness.

Nevertheless, Prime Minister Ranil Wickremesinghe who came to be testified before the commission on his own volition apparently made some political capital out of it with nothing having gone against him at the commission. He made use of the opportunity to explain the macro picture surrounding the bond issue such as the urgent need for money at the time, why auction system was introduced for bond issues and some aspects of the government’s economic programme.

Ministers Malik Samarawickrama and Kabir Hashim who were called before the commission earlier also came out of it without much damage for themselves. The most devastating effect of the appointment of this commission was on Minister Ravi Karunanayake and some of the reformist young backbenchers of the UNP made use of the opportunity to force him out of the political mainstream at least for the time being.

The backbencher group led by Deputy Minister Ajith Perera throughout tried to display a different stance over this issue, publicly saying that it was an unfortunate incident in which the UNP should not have got involved and those who are responsible should be punished. They tried their best to maintain their image as a cleaner group within the party and use the scandal to expedite the reform process they were clamouring for.

However, the opposite happened when it partially boomeranged on them. A good many of that group together with some UNP members of the COPE, the parliamentary committee which earlier looked into the scandal, also got implicated over some sensitive telephone conversations with Arjun Aloysius around the time COPE inquiry was going on.

Now, the public sittings of the Bond Commission are over and its final report is due to be handed over to the President shortly. There was a huge media show surrounding the whole exercise while the only tangible outcome for the moment was the removal of Ravi Karunanayake from the cabinet of ministers.

For the joint Opposition led by Former President Mahinda Rajapaksa the bond scandal was a blessing in disguise. Although many are now trying to claim the credit for getting the bond commission appointed a greater amount of it should go to them because they were the group which vigorously campaigned for a high level probe into the matter which was later picked by others as well.

This unfortunately happened at a time when the whole country was waiting for some progress over the probe into allegations of massive crimes and corruption against the bigwigs of the former government and the new scandal gave them a fantastic opportunity to cover up themselves from the public eye at least for the moment.

Local elections

As the dust settled over the bond commission local government election issue has begun to occupy the media space with the possibility of elections getting further postponed in the face of the stay order issued  by the Court of Appeal preventing the implementation of the gazette notification pertaining to Local Government bodies until December 4.

The popular belief was that the filing of fundamental rights cases by voters in several districts was a sinister move by interested parties to postpone elections indefinitely. Provincial Councils and Local Government Minister Faizer Mustapha for quite some time has been in the middle of this controversy with accusations leveled against him for using various legal loopholes to postpone the elections.

Meanwhile, the reluctance of the SLFP led by President Maithripala Sirisena to face any elections at this time due to the internal split in the party has been attributed to these attempts to postpone local government elections. Amidst these political moves public opinion has been building against the idea of postponing elections with rights groups voicing their opinion against it.

UNP which earlier appeared to be colluding with attempts to postpone elections now seems to have changed their stance, perhaps after realizing that the ground situation is in their favour. Another reason for the change of attitude would have been the displeasure in the UNP camp amidst growing tension that has been building between the coalition partners following revelations at the bond commission.

In this background now both Joint Opposition and the JVP have already handed over two separate Motions of No Confidence against the Provincial Council and Local Government Minister Faizer Mustapha alleging that he has deliberately complicated matters to ensure postponement of local polls and thereby undermined the people’s right to vote.

Meanwhile, the backbenchers of the UNP also have stated that Minister Mustapha has acted in such a way that democratic rights of the voters have been violated and that they would support any No Confidence Motion against him in Parliament. Prime Minister Ranil Wickremesinghe also has asked the legal committee of the UNP to examine the possibility of having LG polls before February 4 next year.

The Speaker Karu Jayasuriya is expected to have a meeting of all political parties in the Parliament to take a decision in this regard. Observers say that in the event all of them insist on going ahead with the elections, a motion can be passed by the Parliament to that effect with a two third majority to go ahead with elections as planned.

Meanwhile, there seem to be a lot of pressure being built up asking minister Mustapha to resign from his ministerial position before any No Confidence Motion is presented in Parliament and if that happens he will be the third minister to resign on similar issues in the recent times with Ravi Karunanayake and Wijedasa Rajapaksa being the other two.

With lessor or no prospects of the two warring factions of the SLFP getting together, if the elections are held the general belief is that the ground situation will be much favorable to the UNP. It is true that the ruling joint government has not gained any popularity in the recent times, while the Joint Opposition not being in control of any established political party will also be not in a position to make much of an electoral impact. Therefore, politically speaking it will be a strange situation where the voters will be compelled to elect the best out of the bad lot.

If the elections are held it will be an opportunity for each party to know its real strength which in reality could be different from disproportionate noise they have been making on the political stage. It will also provide an opportunity for the people to show their response to all political and other developments that have been taking place since the last general election in 2015.

However, whatever happens in a local government election, it is unlikely to bring about a major change in the government and the SLFP led by President Maithripala Sirisena and the UNP led by Prime Minister Ranil Wickremeseinghe will have no alternative other than going ahead with their joint administration until the next major national election.

 

 

 

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Bottom line of the petroleum issue

 

Only proper liberalization can resolve the problem

By Gamini Abeywardane

The Cabinet sub-committee appointed to look into the recent petrol crisis, has found that the failure to maintain buffer stocks and the absence of a mechanism to carry out emergency supplies were the reasons for the shortage.
The committee also raised doubts as to how the delay in the arrival of the two shipments – one ordered by the Ceylon Petroleum Corporation (CPC) and the other by the Lanka Indian Oil Company (LIOC) – and the breakdown of the refinery, all happened around the same time.
Based on the committee report, Petroleum Resources Development Minister Arjuna Ranatunga had directed the CID to conduct an inquiry into this matter. Whatever the outcome of this investigation, it is not going to resolve the issue in the long run and it could be a matter of time before another shortage occurs.

This is certainly an indictment on our current petroleum management system. The severe shortage of petrol, long queues at fuel stations which lasted nearly a week created much frustration among the masses. Irrespective of whatever the reasons behind, it talks volumes about the state of affairs in the energy administration in the country. Each party involved in the issue tried to pass the buck on to the other, while no one has taken responsibility for the crisis situation that arose. The immediate reason for the calamity was the rejection by the authorities, of a shipment of petrol meant for Lanka IOC, on the ground the product was substandard. Spreading of this news resulted in panic buying of fuel increasing the daily average sales beyond the supply capacity of the Ceylon Petroleum Corporation (CPC) resulting in a shortage.

Meantime, there have been allegations that officials of the CPC had failed to keep sufficient stocks to meet an emergency. Around the same time the stories about an inexplicable breakdown at the Oil Refinery at Sapugaskanda and political pressure to unload the substandard oils shipment etc. indicate the level of politics and possibilities of corruption around oil business. Now, much light has been thrown on these factors by the findings of the Cabinet sub-committee which looked into the matter. It is supposed to have recommended a regulatory mechanism to avoid repetition of such situations.

The quantum of monies involved in these deals is such even in the past there have been enough and more allegations of corruption involving politicians handling the subject, directors as well as high officials of the CPC. We have also witnessed the disastrous effects of substandard petrol being imported and released to the market and how government had to pay compensation for the damages caused to vehicles. There are also conspiracy theories and possibilities of sabotage etc. to make the current government unpopular in the face of highly probable local government elections in the near future. Despite these possibilities what is clear is that there is a serious issue in managing the petroleum industry in the country.

There are doubts as to whether country has gained anything by nationalizing the petroleum industry in 1961. At the time the government had no involvement in the petroleum business. Market was controlled by Shell while Esso and Caltex had relatively smaller market share and import, storage and distribution went on smoothly. Nationalization of the industry would have been inevitable because of the need for the state to control the commanding heights of the economy in terms of the political thinking at the time. But the question is whether we have gained much out of it.

Since the government takeover of the petroleum industry the CPC continued as a monopoly till 2003. With unsustainable losses and other inherent issues normally associated with the government sector, the need for deregulating the industry arose and accordingly the monopoly of the CPC was ended with the formation of LIOC, a subsidiary of the Indian Oil Corporation being given nearly a one third share in the local petroleum market in 2003. Storage units in Kolannawa and Muthurajawela were made common user facilities by establishing a separate company called Ceylon Petroleum Storage Terminal Limited (CPSTL) with the joint participation of the Government, CPC and LIOC.

Following the Petroleum Products (Special Provisions) Act passed in 2002 there were plans to have three players – the CPC and two other suppliers in the petroleum market along with a common storage facility. Accordingly, all arrangements were ready with 100 petrol sheds kept under treasury to be handed over to a third player who was to be picked on an open bid system. However, with political changes that did not happen and as a result the expected level of openness or competition has not been achieved in the market.

Had that happened the real benefit of liberalizing the petroleum market would have been achieved with more players in the market and the government having to get involved only in quality control and regulating aspects. This would have been much similar to the situation that prevails in the telecom sector after privatization. If that had happened much of today’s problems associated with the petroleum market like what we have just witnessed and even threats of sudden stoppage of work will not be a problem for anybody.

More over in today’s world it is foolhardy to think that potential foreign investors will come and operate in a country where the whole transport system can become inactive in a moment due to shortage of petrol and diesel due to wild cat strikes or whatever other reason. Therefore, the best way to have some energy security in the coutry and stability in the petroleum market would be to have a third player or more in the market and for the government to regulate it in an efficient manner.

Even the current storage system should be re-examined because a central storage system also has its inherent weaknesses and it’s too much of a risk to depend on one entity for storage. Perhaps, it may be more practical to have more players with each one having its own storage facility. Building new storage facilities may be out of the question in present times because of the high costs involved. No private investor, foreign or local, will spend such a colossal amount of money, especially in an unstable environment with possibility of state takeovers and so on.

The idea of putting the world war 11 era oil tanks in Trincomallee to some good use also becomes relevant in this context as it will also go hand in hand with this issue. If these tanks are utilized in a fruitful manner Sri Lanka will never have a domestic oil shortage and keeping such a buffer stock will ease our problems even in the face of a worldwide petroleum issue. So, the way out is to have a more open attitude towards the petroleum market with more players. Unfortunately with the latest fuel shortage for which the immediate reason appeared to be the low quality shipment ordered by the LIOC, interested parties have spread the distorted opinion that it is the privatization that created the issue.

The strangest thing is that although the petroleum monopoly of the CPC is supposed to have been ended, 82% of the market is still controlled by them and LIOC has only 18%. In such a situation it is highly illogical to blame the small player saying that the reason for the shortage is the rejection of a shipment of theirs over a quality issue. In fact, in such a scenario the bigger player should be able to cash on the situation by releasing additional stocks to the market and increasing their sales. So it is clear that the real reason for the current unhealthy situation is the country’s inability to complete the liberalization process in the manner it was originally planned.

If there are three or more players with nobody having the market control and a proper regulatory mechanism, there can never be shortages and that seems to be the only way to resolve this permanently. Only such a situation will protect the market from disastrous impacts of sudden shortages or work stoppages by employees of one player. However, because of the political sensitivities no government will be able to choose that path in the near future. But, if we are to resolve this issue permanently and lay the foundation for a stable economic future such decisions will have to be taken one day.
  

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SAITM issue, likely to be reloved

 

But overall standards should not be compromised

By Gamini Abeywardane

The seemingly irresolvable SAITM issue has shown some signs of being resolved in the near future. The government’s decision to remove it from the control of Dr. Neville Fernando family and run it as a not-for-profit entity under the supervision of the University Grants Commission (UGC), in terms of the recommendations of Harsha de Silva committee has received some favourable response from the GMOA.

If the GMOA still has some concerns over the admission criterion, overall quality standards or clinical training, it is quite understandable going by our past experience in setting up private medical educational institutions. SAITM as well as infamous North Colombo Medical College (NCMC) which happened to be closed down in the eighties amidst severe protests by medical students of the state universities is a grim reminder of our history of trying to do right things in the wrong way.

Private medical education

Private medical education is not a bad thing, but world over there are stringent criteria for admitting students to medical schools because of the sensitivities involved in the work of the doctors whose competency is a key factor in saving the lives of thousands of patients. Therefore, the minimum entry qualifications for medical studies are quite high compared to what is required for higher education in Arts, Humanities or Pure Science.

Unfortunately, what usually happens in our country is whenever the private sector launches medical schools on a fee levying basis those who are involved in them including respected medical professionals try to misuse those institutions for their mediocre sons and daughters to enter the medical profession. Often the entry requirements are kept at a minimum level having such ulterior motives in mind.

There is a proposal to attach the SAITM operation together with its current students to Sri Lanka Institute of Information Technology (SLITT) at Malabe which has been running for quite some time now, as a not-for-profit higher educational institute for IT and engineering. Under whatever set up the school is going to be placed in future, some justice should be done to its current students who have been wasting both time and money for quite some time due to no fault of theirs. At the same time future intakes should be picked on a proper admission criterion with definite arrangements for clinical training and maintenance of overall high standards.

Now, the issue of SAITM has become internationally known, whatever we do in future in the field of medical education should be properly done because it will affect the country’s reputation for quality of its higher education. With many private institutions of higher education already operating in the country and newer ones coming up frequently, it is time for the government to step in and establish quality control mechanisms for higher education as found in the western countries where private higher education is popular.

In fact there was a similar issue recently with regard to the foreign law degrees awarded through some of the local higher educational institutions when the Council of Legal Education refused to accept them. However, the issue did not attract much public attention as it was settled well in time.

The issue arose because some of the content based on Sri Lankan law included in the foreign degrees and their assignment based evaluation process were questionable. This too arose due to the lack of a suitable quality control mechanism for awarding of degrees through private institutions.  

Politics in higher education  

With proper mechanisms the country can avoid unwanted controversies in whatever new medical schools or other institutions of higher education which are set up in the future. It’s bad enough we have done the same mistake twice – in NCMC and SAITM, because of the lack of proper policy or quality control system in higher education. It’s true these were done under two different regimes, but education policies should not differ depending on the government in power.

The worst scenario as we have just witnessed is when things are done in the wrong way; it opens opportunities for various bankrupt political groups to make capital out of it. In the SAITM issue medical students of the state universities had a genuine grievance because of issues of standards and entry qualifications. The GMOA came in because it was an issue affecting the medical profession.

However, when the issue was dragging for too long without a solution some sections of the JVP as well as Frontline Socialist Party and their affiliate Inter University Students Federation saw much potential for new slogans and seized the opportunity organizing massive student protest campaigns. Some of them went to the extent of demanding total closure of SAITM and putting a stop to private medical education.

With these latest government proposals which have been partially accepted by the GMOA, there are some hopes for resolving it and the most displeased over this development would be those political groups who were making capital out of it.

Quality control

Introduction of stringent quality controls will not only take politics out of higher education but also will enhance the quality and make our higher education more acceptable internationally. This is quite important because Sri Lanka with its educated population has all the potential of becoming an education hub in the region attracting even reputed international educational institutions into the country.

Private medical education is quite an accepted thing everywhere in the world. Some of the best medical schools in the world are private institutions, but governments in respective countries monitor them with strict standards. Therefore, what is needed here too is a proper monitoring regime for higher education with strict standards for medical education. Such high standards should apply to all higher education institutions in the country, be they private or state controlled.

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