News
Govt. suffers huge revenue losses as stone quarries are exploited
Stone quarries in the key mining districts of Hambantota, Anuradhapura, Kurunegala and Vavuniya are being heavily exploited at “huge loss of revenue” to the Government, the National Audit Office (NAO) has found.
Demand for construction material, primarily stone, has intensified in recent years. The NAO has identified serious issues in quarrying including widespread non-adherence to licence conditions and excavation outside of the permitted GPS coordinates. The report of its performance audit has been released to Parliament.
The Geological Survey and Mines Bureau (GSMB) has not revised the market value of minerals on the basis of which it charges royalty for the past eight years. It stands at Rs 1,500 per cubic metre. Prescribed distances between quarry boundaries and other properties were often not respected and there was no scientific method to measure quantities of mined mineral.
Government lands were used without permission while leasing conditions were violated. There was environmental damage but no rehabilitation mechanism. And the NAO has found evidence of the illegal use of explosives.
Each GSMB industrial mining licence (IML) identifies the permitted land area and metric grid limits for excavation. But audit checks showed there were often no boundary posts and nothing done to impose them, allowing licence-holders to extract without limitation.
The State Lands Ordinance legislates four per cent of “current market value” as rent when Government lands are leased out for commercial purposes. In the case of 23 quarries belonging to seven divisional secretariats in Hambantota and Kurunegala, however, the annual lease rent was charged at four per cent of “undeveloped value” at a loss to State coffers. The audit was not told why the Commissioner General of Lands—the relevant authority—had permitted this.
Licence-holders found guilty in court for violating IML conditions (such as mining in excess of prescribed limits) are usually fined and allowed to continue without cancellation of permit, issuance of warning letters or even the recording of their violations anywhere. Such provision does not exist in law, highlighting the need for amendment.
There was no clear database of stone deposits or geological map of deposits for Hambantota, Anuradhapura, Vavuniya and Kurunegala districts. The volumes extractable from abandoned stone deposits hadn’t been calculated and incorporated into a database.
As a result, the GSMB had no knowledge of the volume of minerals that can be mined; it could not compare the volume of such minerals with the quantity already mined; and could not support decision-making in development schemes without such information.
There was no rehabilitation of quarries where mining had ended, of illegal quarries or of those suspended due to IML violations. There was also no methodology for it in the four districts audited.
IML licences prohibit mining underground when quarrying for stone. But there is no definition for “surface of the ground level” resulting in deep holes being bored into the ground across several quarries.
The NAO found several instances of illegal stone mining in Government-owned lands where no action was taken to collect taxes, royalties or rents. One violator could not explain to audit how he procured explosives without Defence Ministry approval to extract a large volume of stones illegally on State-land.
Many more cases of illegal use of explosives were identified, as were instances of mining over the permitted limits. There were also examples of land being continuously leased without the collection of taxes and excessive mining without any attempt to collect royalties on the difference.
In one quarry at Liyangasthota of the Ambalantota divisional secretariat, for instance, the volume of stones harvested from October 2017 to October 2019 did not tally with the magnitude of explosives used. The NAO could not determine what the excess explosives—around 19,916 kilos—had been deployed for. And, while IMLs prohibit the use of electric detonators, this quarry was issued with 12,600 of these instruments during the period under review.
There is a national security threat arising from the illegal use of explosives and excess issuance to quarries, the NAO states, calling for a formal method of supervision in coordination with all institutions involved in the use of explosives.
The best way to say that you found the home of your dreams is by finding it on Hitad.lk. We have listings for apartments for sale or rent in Sri Lanka, no matter what locale you're looking for! Whether you live in Colombo, Galle, Kandy, Matara, Jaffna and more - we've got them all!