20A pitfalls

Monday, 14 September 2020 01:37 -     - {{hitsCtrl.values.hits}}

All governments come to power promising a multitude of things but holding them to it is usually an onerous task. President Gotabaya Rajapaksa and his Government came into power, in part by telling the public they will improve governance and minimise corruption. However, the proposed 20th Amendment (20A) threatens to severely undermine a key part of this endeavour by removing or gutting several key safeguards, including the National Procurement and Audit Commissions.

The National Procurement Commission was appointed under the 19th Amendment (19A) to upgrade procurement guidelines so that transparency of tender awards would be improved and a host of measures could be implemented to protect public finance. The guidelines, which have been ready since early 2018 were not passed in Parliament by the former Government, which was undoubtedly a massive oversight on their behalf but removing the commission entirely is an even bigger error. 

The multitude of issues that have cropped up in the recent past can be traced directly to the way tenders are awarded and how State-run companies are managed. The corruption and mismanagement will have an additional layer of impunity now if both the Procurement and Audit Commissions are scrapped. Removing the latter will ensure that public officials cannot be held responsible if their actions cause a loss to the State, reopening the door to an unhealthy nexus between politicians, public servants and nefarious business entities. 

A report over the weekend highlighted that nearly 120 State-owned companies, including the debt-ridden SriLankan Airlines, will be exempt from Government audit under the proposed 20th Amendment. Among scores of other business entities to be excluded are Lanka Electricity Company (LECO), Sri Lanka Insurance, Lanka Hospitals PLC, Litro Gas Lanka Ltd., Lanka Sathosa, multiple plantation and electricity companies, and Lanka Coal Company Ltd.

The draft proposal this week drew strong protest from the Sri Lanka Audit Service Association (SLASA). According to the union, when State-owned companies – in which the Government is majority shareholder – are audited by private entities, the reports are not required to be submitted to Parliament. This would undermine parliamentary financial oversight.

It was for this reason that the Constitution’s Article 154(1) was introduced and according to this, the Auditor-General “shall audit” all departments of the Government, the Office of the Secretary to the President, the Office of the Secretary to the Prime Minister, the Offices of the Cabinet of Ministers, the independent commissions, as well as public corporations and businesses registered under the Companies Act in which the Government, a public corporation or a local authority holds 50% or more of shares.

The public are well aware of the corrupt decisions that were made using these companies at hefty cost to the taxpayers. The issues at SriLankan Airlines alone builds a case for not just the Procurement and Audit Commissions to remain but also for stronger appointments to the Bribery and Corruption Commission as well as parliamentary committees such as Committee on Public Enterprises (COPE) and Committee on Public Accounts (COPA). The Speaker’s decision on whether to appoint Opposition Lawmakers to head COPE and COPA will be decided this month but since they do not have the power to take legal action, at best their capacity to push back against corruption will be limited. 

The scrapping of the 19A was supposedly to improve governance but this goal will not be served by these proposals in the 20A. This is not beneficial for the public and all but unfortunately there is little citizens will be able to do about it.