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SriLankan’s former CEO also worked for Mobitel, drawing thumping salaries from both
Starling revelations concerning the alleged improper conduct of current and former top officials at the national carrier have emerged as the Presidential Commission of Inquiry (PoI) on irregularities at SriLankan Airlines, SriLankan Catering and Mihin Lanka continued its sittings. Among the revelations made this week were alleged irregularities in the appointment of former SriLankan Chief Executive Officer (CEO) Kapila Chandrasena, current CEO Suren Ratwatte and Chief Commercial Officer (CCO) Siva Ramachandran.
Former CEO Kapila Chandrasena
SriLankan’s Company Secretary Dalrene Thirukumar, Sri Lanka Nidahas Sevaka Sangamaya General Secretary Hasantha Kumara Yasarath and Civil Aviation Authority Director P.A. Jayakantha gave evidence before the commission this week. The five-member PoI comprises Retired Supreme Court Justice Anil Gooneratne (Chairman), Court of Appeal Judge Gamini Rohan Amarasekara, Retired High Court Judge Piyasena Ranasinghe, Retired Deputy Auditor General Don Anthony Harold and Sri Lanka Accounting and Auditing Standards Monitoring Board Director General Wasantha Jayaseeli Kapugama.
Some of the highlights that came up before the commission this week:
Documents provided to the commission by mobile phone service provider Mobitel revealed that former Sri Lankan CEO Chandrasena received a monthly salary of Rs.500,000 plus other benefits from Mobitel for working as its Acting CEO (From April 2013 to June 2014) and Rs. 450,000 a month and other benefits when he served as consultant to the same company (from June 2014 to February 2015). Both appointments were held while he was serving as full-time CEO of SriLankan (From 2011 to 2015).
Company Secretary Thirukumar told the commission that Mr Chandrasena had not informed the airline through his annual declaration of interest that he was also holding positions at Mobitel.
She disclosed to the commission that SriLankan Airlines posted a net loss of Rs. 93 billion during Mr. Chandrasena’s four-year tenure as CEO.
Mr Chandrasena, a board member of SriLankan Airlines and Mihin Lanka until 2011, was appointed as CEO of SriLankan at an emergency board meeting on May 3, 2011. The appointment was made without first advertising the vacancy and calling for applications.
Mr Chandrasena had not applied for the position of CEO and documents regarding his qualifications for the post were not found by the Company Secretary
Present CEO Suren Ratwatte
Mr Chandrasena was paid a monthly salary of Rs.1.5 million, plus other benefits during his first three years in the position.
A board paper presented on August 25, 2015 noted that the decision to appoint a new CEO was deferred. A board paper presented on September 21, 2015, though, mentioned a draft letter of appointment for Suren Ratwatte as CEO subject to a six-month probation period with a taxable monthly salary of Rs.3 million and annual performance bonus of Rs.10 million if the company’s budget targets were achieved.
There had been no board meetings between August 25, 2015 and September 21, 2015, Ms Thirukumar testified before the Commission. There was no board minute which noted that the board had taken a decision to appoint Mr. Ratwatte as CEO.
The Company Secretary also said she drafted Mr Ratwatte’s letter of appointment on the instructions of SriLankan Airlines Chairman Ajith Dias.
Mr Ratwatte was confirmed in his position as CEO after six months without extending his probation and without conducting a performance appraisal and development evaluation, despite it being a condition in his contract.
Mr Ratwatte was confirmed as CEO after Prime Minister Ranil Wickremesinghe and then Public Enterprise Development Minister Kabir Hashim requested the Board to confirm him as soon as possible.
Mr Ratwatte’s tenure as CEO of SriLankan Airlines will end on July 31, 2018. To date, there has been no performance appraisal and development evaluation conducted on him, the Company Secretary confirmed.
At its meeting held on November 27, 2015, the board was still divided over the appointment of Siva Ramachandran as Chief Commercial Officer (CCO). However, a letter of appointment dated November 16, 2015 had been issued to Mr Ramachandran and he had signed it on November 20, 2015.
Mr Ramachandran was appointed as CCO on the instructions of Chairman Ajith Dias after he informed the board that the Cabinet had approved it. However, no document to prove this has been presented to the commission as yet
Hasantha Kumara Yasarath, General Secretary of Sri Lanka Nidahas Sevaka Sangamaya attached to SriLankan Airlines, testified that Major General (Rtd.) P. Chandrawansa was appointed as Head of Group Security for SriLankan Airlines, SriLankan Catering and Mihin Lanka in February, 2012, in a newly created position that was never publicly advertised in newspapers or even published as a Staff Vacancy Notice within these companies.
Mr Yasarath said Maj.Gen (Rtd.) Chandrawansa was additionally appointed as Head of Property and Procurement about a year later on the orders of SriLankan Chairman Nishantha Wickramasinghe.
Charges were levelled in the Weliamuna report against Maj.Gen (Rtd.) Chandrawansa over the procurement of X-Ray machines for the airport and for using security officers for polls campaign. Yet, he was given two further extensions of service by the new management covering a period from November 2015 to May 2017.
On the direction of Maj.Gen (Rtd.) Chandrawansa, security officers and vehicles of the airline were used for former President Mahinda Rajapaksa’s January 2015 presidential election campaign, especially in the Kolonnawa electorate, Mr Yasarath stated.
Company rules and regulations only allow employees to be released for trade union activities. They prohibit workers from being used for political activities. Yet, security officers were released for campaign work, according to Mr Yasarath.
Civil Aviation Authority (CAA) Director P.A. Jayakantha told the Commission that the national carrier is using two Explosive Trace Detectors (ETDs) at the BIA, though their CAA certification lapsed in February this year.
According to the International Civil Aviation Organisation (ICAO), of which Sri Lanka is a member, screening security equipment should meet the standards specified by the Transportation Security Administration (TSA) of the United States and Britain’s Department for Transport. Member countries are advised by the two bodies to only buy equipment at their own risk, from the ‘Approved List’ published by the agencies. The machines in question had been purchased by SriLankan from what is known as the ‘Grandfather List,’ consisting of equipment that had failed a required 24-month field test. Members are advised not to buy any machines from the Grandfather list.
The lifespan of the machines bought in 2016 expires in February 2019. Given the short lifespan of the machines, the CAA only certified them for a year and instructed SriLankan to apply for renewal of the certification 90 days prior to expiration of the certification. This was not done and the machines have not been certified again since February this year, the CAA director said.
In answer to a query by the commission whether this created any security threat, Mr Jayakantha assured that while the CAA certification on the two machines lapsed in February, CAA inspectors were keeping the machines under constant surveillance and were so far satisfied with their performance.