The Sunday Times Economic Analysis

The Sunday Times Economic Analysis By the Economist

A way out of Lanka's holiday hoodoo
As the week of holidays is coming to an end our thoughts turn once again to the issue of excessive holidays being detrimental to the Sri Lankan economy. The very large number of holidays, perhaps the highest for any country, it is often contended decreases productivity in the economy. The business community has been in the forefront arguing the case for a reduction of the number of holidays. Trade unions and religious groups have opposed some of the proposed changes.

In the last decade there has been some progress in reducing the holidays marginally. Even these reductions have met with opposition from those whose holidays are reduced. We continue to have too many holidays, especially in the first half of the year. The pluralistic composition of the population is at the root of this problem. Apart from the majority Buddhist community, the religious holidays of the Hindus, Christians and Muslims too have to be accommodated. In that context it is difficult to reduce the number of holidays.

There are two significant issues that require to be addressed. One is the number of holidays and the other is the disruptive feature of the holidays. Perhaps the number of holidays, though excessive by international standards, is the least damaging. The occurrence of these holidays regularly especially during the first part of the year breaks the flow of work.

In the case of industrial enterprise that cater to overseas export markets, such holidays disrupt their manufacturing schedules. The need to pay higher holiday and overtime rates mean higher costs.

There is a need to view the scheme of holidays in a holistic manner. Holidays are very much a needed aspect of life and work. No human being could work continuously. Every community and culture has a period of holidays when the community as a whole takes it off and rejuvenates.

The Chinese, a very hardworking community, are well known for the long spell of holidays and festivities during the Chinese New Year when work comes to a halt. Western countries take a long break at Christmas time. North Americans take an extended thanksgiving weekend as well. The Sinhala and Tamil New Year are our equivalents, as is the case in other Asian societies.

Often, as in this year, there is a coincidence of the New Year with a Poya holiday and Good Friday in April and Prophet Mohamed's Birthday and two Vesak holidays falling in a row in May. This makes it a long period of holidays. Such a long period of about a week is a much-needed spell. It keeps alive the cultural life of the people, links people with their rural roots, strengthens family bonds, gives an opportunity for community recreation and revitalises the working community and their families. Therefore such a spell of holidays is indeed as essential a part of national production as the working days.

Being a community that is also exposed to international culture we also celebrate the Christmas period and usher in the Gregorian New Year with similar fervour. A realistic approach to national holidays would be to accept these two periods as periods of national holidays and have a week of holidays during each of these periods. The extra holidays should be deducted from the annual entitlement of leave. Some institutions practise this. It is of course not possible for those institutions that serve essential public needs to do so. Therefore this approach to a holiday period has to be combined with exceptions.

One of the unexplored possibilities for reducing the disruption of work is for the religious holidays of the minority communities to be applicable only to those who profess the religion. In fairness, while such holidays would be mandatory to the declared believers, the number of days so taken should be debited from their leave quota. Otherwise they would enjoy an unfair advantage. Such a device would reduce the disruption of work during the year. The intractable holiday issue is the Poya holiday each month.

Politically and culturally it would be impossible to eliminate this holiday. This may have to be an economic cost that the country has to accept. The most unproductive and damaging feature of our holidays lies in their being strewn all over the calendar with mid week holidays disrupting work. It is this aspect that must be addressed. In approaching this issue there are possibilities for institutions to provide financial incentives to enable work to continue without disruption though the full work force may not be willing to work. Once again the plurality of our population can be used to some advantage.

Reducing the number of holidays and ensuring a smoother functioning of the economy throughout the year is indeed a difficult problem to solve. The religious sensitivities of our people and the lack of a pragmatic approach militate against finding a solution. Attempts must continue to be made on the lines suggested above to at least alleviate the problem.

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