Corruption, slow killer in Sri Lankan society

Bribery, corruption and price mafias are killing the country, they have enveloped the country and a clear analysis points to mother of corruption and the root cause being the 1978 constitution.
This was stated by Ravi Ratnasabapathy, Resident Fellow, Advocata Institute, at a media briefing  at the launch of the report on “Price Controls in Sri Lanka – Political Theatre” prepared by Advocata on Tuesday in Colombo.
On the sidelines of the event, he told the Business Times that: “Actually corruption starts with the electoral financing and it all started with the 1978 constitution which removed the disclosure of the campaign financing and the disclosure of sources.  Regulation is a big area where corruption can come.  Corruption kills our society and the country”.  
The report is the outcome of a survey carried out by Advocata Institute to determine whether price controls has any effect on the cost of living. It recommends that the best way of reducing the prices is that instead of price controls, to foster competition and to take measures to improve productivity as evidenced in the telecommunication services. It also advocates deregulation.
Advocata is an independent policy think tank working for sound public policy ideas and its mission is supported by academics, journalists, business community and many others.
In the preamble of the report, Dhananath Fernando, COO, Advocata indicates that the deteriorating ‘cost of living’ has been glued in the minds of the people ever since 1970 and several years monetary expansion created cumulative increase in inflation and price escalation. 
In its recommendations, the report indicated that the Government policies are contradictory and taxes and price controls are imposed on the same items. Taxes raise retail prices conflicting with the controls that are supposed to limit price increases. Price controls are of limited value in reducing costs.  
It went on to indicate that controls can cause significant welfare losses, a deterioration of product quality, reduction in investment and in the long run, higher prices.  
There is a serious constraint in the productivity aspect of local produce, like potatoes, big onions, etc as their prices in the consumer market is exorbitantly high. This is compared to the same imported product prices which are lower in the consumer market even after they pay taxes on the imports and serious enforcements of price controls are confined to items produced by the multinationals and large corporates. (QP)