New laws to govern loss-making public enterprises

Thursday, 24 November 2016 00:24 - - {{hitsCtrl.values.hits}}

Government expects to pass a new law in January to manage State enterprises, revealed Deputy Minister of Public Enterprise Development Eran Wickramaratne yesterday at Parliament.

According to the proposed Act, Government will appoint a board of directors who will be responsible for appointing fit and proper directors to all State enterprises. “There are over 250 State enterprises reporting a total loss exceeding Rs. 600 million in 2014. Political influence and mismanagement are the key reasons for these losses. We trust the proposed Act will minimise these issues,” said the Deputy Minister.

“There are airlines, banks and plantations among them. These establishments engage in different business activities and there is no one clear-cut, common remedy that could be applied to them all. If you take SriLankan Airlines as an example, it had to pay Rs.14.5 billion b as demurrage just to cancel the agreements on three aircrafts.

Who is responsible for this loss? Who could be sued for this loss? Things are not clear and there are lapses in the law. So, no final decision is reached,” he said. (AH)