News
End of the road, if payments are not made
A proposal to pay arrears of Rs. 59 billion as outstanding payments to contractors engaged in road maintenance work is to be submitted to the Cabinet shortly.
The payments had been accumulating over the past six months and continued delay in paying the contractors was hindering road maintenance work of thousands of kilometres of national roads throughout the country, a Road Development Authority (RDA) official told the Sunday times.
He warned that continued delays in paying contractors would make it difficult for the Government to attract contractors to work on projects as they would be unsure when their payments would be made.
The RDA has now formulated a Cabinet paper asking the Treasury to release funds to at least pay the outstanding amounts in instalments. The proposal is to be submitted to the Cabinet soon by the new Highways Minister Bandula Gunawardena.
Meanwhile, more than Rs. 5 billion is needed to pay compensation to those whose lands have been acquired by the state for road building while more than Rs. 13 billion is needed to make loan repayments to local banks.
Altogether, the Government needs more than Rs. 77 billion to settle all outstanding payments.
A senior Finance Ministry official said Treasury was not in a position to release funds for such payments. However, the ministry was prepared to look into the possibility of releasing at least part of the funds if the economy stabalized in the next few months, the source said.
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