Public unhappy over performance of state enterprises
A survey conducted by the World Bank and other counterparts have found that many Sri Lankans are not happy about the performance of state enterprises due to issues of political interference and has stressed the need for better governance.
Revealing this data, Idah Pswarayi-Riddihough, World Bank’s Country Director for Sri Lanka and Maldives, said that many state-owned enterprises had reported significant and persistent losses over the years which had caused social problems. She was speaking at the recent launch of the “Handbook on Good Governance for Chairmen and Board of Directors of Public Enterprises” held at the Institute of Chartered Accountants of Sri Lanka in Colombo.
From 2012- 2015, the net transfers from the state to public enterprises amounted to Rs.460 billion more than what was estimated in the budget. Referring to a study done on 70 countries in 2007, she said it indicated that countries with higher quality institutions experienced a higher growth and low corruption.
It further estimated that countries moving towards high quality institutions had a growth rate of 26 per cent in the short term and 40 per cent in the long term.
“Those are not small numbers,” she added.
Referring to a World Bank report, she said it was intangible capital that makes the difference. Intangible capital is composed of human capital, natural capital, institutional capital and social capital that is very relevant to Sri Lanka in strengthening the governance framework. The recently approved Right to Information and Audit Acts create a conducive environment to improve transparency and accountability and good governance in the public sector and state enterprises. She said public sector enterprises in Sri Lanka represent a major part of the state institutions and their governance matters greatly.
Around 400 small and medium enterprises (SME) that operate in Sri Lanka play a major key role in the country’s economy by providing infrastructure and service facilities. She said that good governance requires credible institutions that are built on principles of transparency and accountability to end poverty and to share prosperity.
“While many of us are not government specialists we can relate to the impact of good and bad governance where the recommendation of this hand book should be implemented. It is the citizen’s right and duty to demand good governance,” she said.
Parliamentary Speaker Karu Jayasuriya, Chief Guest at the event, said that enormous losses of public corporations can be stopped or minimised to a certain degree as expressed by the World Bank Country Director.
These loss-making institutions are making the country’s economy to bleed and that had gone on for a long time.
The present government had taken measures to uphold the rule of law, accountability and good governance and transparency in managing the public sector. He said the creations of independent commissions under the 19th amendment such as the Right to Information Act and the proposed Audit Act and the Public Finance Act will soon become a reality. Since 2015 several far reaching steps have been taken to strengthen the supervision of the public boards. The opposition political parties have been given a chance to participate in the COPE committee. The Auditor General too had been vested with powers to eradicate corruption in the public sector. President of the Institute of Chartered Accountants of Sri Lanka Jagath Perera also spoke. Chairman National Human Resources Development Dinesh Weerakkody participated in the panel discussions.