Editorial

The Government has released a 100-plus page White Paper on combating corruption. In the pipeline since the Yahapalana Government started drafting it in 2017, it appears to have been fast-forwarded following the subject of corruption in Sri Lanka getting internationalised and global lending institutions like the World Bank and the International Monetary Fund (IMF) link-ing it to the economic crisis in the country, and demanding drastic remedial action.

Sri Lanka’s corruption has graduated from chronic to endemic; from the very very top to the plebian, whoever has any discretionary authority, from tender selections to exchange controls to waiving customs duties, palms have to be greased or monies remitted to offshore accounts to get a job done.

Foreign countries, private companies and ‘middle-men’ have got into the game big-time, with Presidents, Ministers and Ministry Secretaries at the very apex and the commoner following – clerk and garbage collector. The recent shortage of foreign exchange propelled many in that di-rection for sheer survival and shortages of gas and fuel had shed attendants flushed with ‘pock-et-money’ as more and more regulations fuelled corruption becoming implanted in the nation’s DNA.

Sustained economic growth in countries like Sri Lanka is a necessary condition for reducing corruption, and conversely, reducing corruption is necessary for sustained economic growth.

Very much like the UN Human Rights Council now shifting gear from overseeing Sri Lanka’s human rights record to its corruption record, the prolonged absence of a substantive anti-graft investigative and legal framework and lack of political will to tackle the issue has forced the IMF’s proposed EFF (Extended Fund Facility) to require such monitoring as Sri Lanka is infa-mously lumped as a ‘basket case’ in the eyes of the world, a country unable to pay its debts.

Over the years, there has been no shortage of initiatives by each incoming Government to root out corruption. Investigations, indictments and charge-sheets have been numerous but to name a single ‘shark’ – a political leader, official or businessman who has been sent to Welikada will not be possible.

Especially created Criminal Justice Commissions of yesteryear were tainted as political witch-hunts. Bribery and Corruption Commissions of later vintage and specially rustled-up High Courts have seen more acquittals than convictions as sometimes deliberately half-baked investi-gations by corrupt Financial Crimes sleuths revealed the sham in the nation’s drive against cor-ruption. Corrupt and/or incompetent investigators, poor prosecutors and weak laws have been the hallmark of a country now paying dearly for allowing itself to be milked by a few at the top.

Coal, gas, sugar, and garlic scams, lately of gigantic proportions, and routine tenders where local agents and fixers in cahoots with politicians and officials rule the roost have ruined Sri Lanka’s name for a genuine investor. The BOI and the Port City Commission will be left running behind money launderers and shady investors, giving concession after concession at the expense of the local entrepreneur. Recent petty fines imposed on those who manipulated the Stock Exchange are a joke, and have not stopped ‘pump and dump’ price fixing.

Tenders are routinely compromised and even if awarded fairly in the first instance, some fixing takes place to have it cancelled until it is given to the one ear-marked on the list. Procurement is a goldmine for those in a discretionary authority of picking the winning candidate. Everything is manipulated and corruption has spiralled out of control.

It was a US Court that found a Lankan ambassador fiddling the books in the purchase of a new property for the embassy in Washington. It was in the UK High Court that details of the SriLan-kan Airlines Airbus purchase scandal broke, naming the former CEO of the airline now in Aus-tralia as a swindler. An Australian subsidy SMEC has been named by the World Bank for “in-appropriate payments” for projects in Sri Lanka. This same company that did a feasibility study for the RDA (Road Development Authority) in Sri Lanka was this week charged in Australia (not Sri Lanka) for paying bribes. The Rs. 2 billion report (the most expensive feasibility study ever) it provided the RDA was considered sub-par, and could not be accepted. The company was awarded this contract without tender.

What have all the Oversight Committees of Parliament, FCIDs, and Bribery Commissions done about this case – and many other such inflated ‘projects’ with bribes factored into project costs, despite the facts appearing in the media, Auditor General’s reports, Presidential Commissions and what-not?

This week’s announcement of a proposed new tax regime to net additional revenue to a bank-rupt Treasury has run into an expected storm of protests. Blaming irresponsible tax exemptions and excessive money printing during the Gotabaya Rajapaksa Government is fine, but that alone will not solve the sheer dearth of even local Rupees to run the country.

The Finance Ministry’s forecast of the growth rate, based on the recent IMF staff-level agree-ment, is negative this year and the next, and less than 3 percent in 2024-2026. This week’s IMF meeting in Washington also predicted a global recession in 2023 compounding Sri Lanka’s eco-nomic crisis.

The Government’s anti-corruption White Paper gives wide-ranging powers to an independent commission but it might also want to give it suo moto powers, like those granted to a French Magistrate to initiate criminal investigations going beyond the existing common law jurisdiction where a complaint has to be made and prosecutors have to rely on applying for court orders to gather evidence. These Magistrates, however, need to be appointed by the Constitutional Coun-cil (the 22nd Amendment needs to be enacted for this) or by the Judicial Services Commission, and certainly not by the Government lest it becomes another political instrument of the govern-ing party.

With corruption so entrenched especially in the three key revenue collection authorities – Inland Revenue, Customs and Excise and wherever revenue is collected, the more regulated the State and the more discretionary powers given to underpaid public servants, the Government’s reve-nue targets will not materialise. The stringent new tax regime might see more tax avoidance and only fuel bribery unless there is fear for both, the bribe-giver and the bribe-taker.

Clearly, the envisaged independent Commission to fight corruption needs ancillary help and training from abroad for those tasked with this onerous responsibility. As said in Mario Puzo’s book, The Godfather, and quoted in a Pakistan Supreme Court case on the infamous Panama Papers; “Behind every unexplained fortune, lies a successful crime”. And until, like in Peru and South Korea, VVIPs are sent to jail for corruption, there is unlikely to be a change in the status quo in corruption-ridden Sri Lanka.