Finance Minister Ravi Karunanayake yesterday revealed that they have found an additional ‘unexpected’ expenditure of Rs.5.4 billion, which will shoot up the total Government expenditure to Rs. 1.15 trillion.
He said that this ‘unexpected’ expenditure was disclosed by a letter sent by Social Empowerment and Welfare Minister S.B. Disannayake yesterday.
“We certainly knew when we took over economy that it was absolute disaster, but we never knew that it would come to this situation. These are some things you get to know when you take office. When you know this type of information comes today for an expenditure incurred in 2013 then you know to the level of concealment,” Karunanayake told the media yesterday.
He said the funds were obtained during the Rajapaksa regime and most of them were obtained for development activities such as constructing roads.
With the rectification as of yesterday, a statement will be issued on the breakdown of the Rs.1.15 trillion by tomorrow, the Minister assured.
Karunanayake said they would ask for the opinion from the Cabinet of Ministers on how the Government should address this issue.
“We are keen to ensure transparency. We want to take it to the Parliament. Anyone can say it wasn’t incurred during their time. I’m making it open so these are not political statements. We have to ask the Cabinet what to do in this matter,” he added.
He pointed out that this Rs.1.15 trillion expenditure is high and puts pressure on the deficit.
The Minister said 95% of the projects were decided by the former President Mahinda Rajapaksa in his capacity as the Finance Minister, as well as Economic Development Minister Basil Rajapaksa, Defence and Urban Development Secretary Gotabaya Rajapaksa, MP Namal Rajapaksa, Treasury Secretary Dr. P.B. Jayasundara and Central Bank Governor Ajith Nivard Cabraal.
Minister Ravi Karunanayake said that however as a responsible Government that inherits an economic management team under President Maithripala Sirisena and Premier Ranil Wickremesinghe, they would come up with a solution that would have the least impact on the people.
When asked about the impact of the ‘unexpected’ expenditure on the Budget deficit he said, “If you look at 1.1 trillion on a budget it is roughly 10%. These are things that come our way and we need to check. However, that doesn’t mean we are going to book it in the same time. That’s where all the professionals are able to ensure that we are doing the best, but we have to highlight what is outstanding. Our budget deficit is 5.9% or Rs. 726 billion.”
Karunanayake noted that at this moment Sri Lanka should look for external shocks as the budget is ‘something that we could have a control on.’
“Our budget is alright, but the external shocks are something beyond our control. You never knew when China and India were going to devalue the currency. We have to deal with the external turbulences,” he stressed.
“We are working with the CIFC model and we are looking at monies coming into the country. There’s a lot of foreign exchange coming into the country. I thank all of Davos, Germany and the arrival of New the Zealand Prime Minister John Key- all these are manifestation showing confidence in the country,” he said.