Used, not new, cars in future for government servants
The cash-strapped government will stop the practice of buying new vehicles for government agencies and instead hire used or reconditioned vehicles as a cost cutting measure. This decision was announced at a high level meeting held at the Finance Ministry in Colombo, last week, official sources revealed adding that the Treasury will call for bids from service providers to hire vehicles. A standard procedure would be followed for this purpose following the identification of the required number of vehicles for all state agencies including ministries and government departments, senior official told the Business Times.
The Treasury will impose a ceiling allocation on monthly hiring charges as well as types of vehicles permitted be hired, he said adding that this would reduce millions of rupees being paid as installments and interest for the procurement of vehicles under the earlier leasing arrangement with the Bank of Ceylon (BoC) and the People’s Leasing Company, a subsidiary leasing company of People’s Bank. Earlier vehicles either purchased or leased for Ministries, Departments, Provincial Councils and Government agencies came from Consolidated Fund payment. The practice of buying vehicles for government agencies once in every three years by the Treasury is unbearable for a country like Sri Lanka, an eminent economist who wished to remain anonymous told Business Times.
He said that a brand new vehicle could be used in good condition for at least five years even it depreciates 10 per cent per annum. However new vehicle importers are opposing the move. Chairman of the Ceylon Motor Traders Association (CMTA) Gihan Pilapitiya told the Business Times that the association will request the government not to hire used or reconditioned vehicles as it will create many issues including the transparency in such deals. He added that the government should stick to brand new vehicles even if the decision is to hire vehicles. Japanese used cars are discarded there due to strict quality guidelines and then exported to other Asian nations including Sri Lanka.