Rural Reawakening As The Solution To Economic & Social Problems

By Siri Gamage –OCTOBER 16, 2017

Dr. Siri Gamage

We often criticise the current development model due to its dependence on foreign sources of funding, expertise, potential for corruption and ideology that it creates, i.e. idea that we don’t have necessary intelligence to conceptualise the problems and solutions. We also criticise the government leaders who rely on such a model to attract more loans, investments and expertise from abroad. This applies even to the fields of education and learning, medicine, construction, culture, food production, etc. However, we tend to forget or give less priority to our own talents, expertise, intelligence and wisdom except in the areas of our religions. This is a syndrome or illness that we have inherited as a nation from European colonialism and continue to suffer from. It is time to reflect on the possibilities for a rural reawakening from the Southern, Northern and Central heartlands of the island and act upon the same with a steely determination to circumvent this dependence on anything foreign. 

This is easily said than done in a society where all rivers flow towards Colombo and beyond. Though we have Provincial Councils for so called decentralisation, these bodies contribute only to the existing chaos and the dependency syndrome mentioned earlier. Commentators spend valuable time and energy for discussing the postponement of local government elections. Though they are important, we need to think beyond Local Government bodies when we talk about the rural heartland and its predicament.

There is out migration of the educated youths from rural heartlands to capital city and other urban centres. Some set their eyes on foreign destinations for employment in countries like South Korea. Many choose to engage in quite demeaning work for a few dollars in foreign countries instead of suffering the humiliation of being unemployed in your own backyard and be powerless. The rural population rely on their elected representatives to do the right thing by their kith and kin, a dream they held since independence. Yet by each year that passes, they realise that the solutions to local problems are far away. They observe the activities conducted in the name of development, fancy vehicles with Logos and officials, foreign consultants visiting their locale. They also answer questions these experts and survey conductors ask of them thinking something good can happen. Yet day-by-day they realise how their life is being controlled, taxed, and subjected to rampant consumerism leaving very little in their pockets. They see the way the land, water, and other resources that give sustenance for contented community life are being appropriated by the state, rich classes or foreign companies. It is like another tsunami, intended or unintended.

There is one resource the country has not utilised well for the purpose of rural uplifting or reawakening. It is the rural talent and collective intelligence of the people. This is because there are no vehicles or mechanisms to do so. eg. Community based organisations such as self-help organisations. When I was a school going boy in Walasmulla area in the late 50s, there were rural development societies (Gramma Sanvardhana samagam). There was also Gam Karya Sabha, an elected local government body. Cooperative societies also existed along with temple societies. However, in the following decades these entities evaporated in significance. In the 70s, there was an interest in the idea of rural awakening and development. I remember research projects and seminars conducted by Marga Institue to influence policy making. Mr Sunimal Fernando led some of these projects then. Marga also published books, seminar papers etc. on the subject. Then came the ARTI affiliated to the Ministry of Agriculture doing similar research, training etc. But what is the situation today not only in terms of research but also training and aiding rural agriculture development?  How far rural development figure in the minds of policy planners? What priority has it been given in the overall future vision of the government?

The lethargy in coming together as communities and forming rural development societies for the very welfare and development of one’s area is partly due to the fractured nature of rural society. Rural society is divided along political party, rich and poor, caste, ethnicity, and other factors. Secondly, it is fractured along those with economic and political power vs. those who lack these. Thirdly, it is divided on the basis of those who have access to modern knowledge, networks, mobility and technology vs. those without. Most women still play a subservient role to men. Rural youths are marginalised by the social and political system. Though unhappy, many in this situation leave governance to professional politicians and mind their own affairs. Our intellectuals do not discuss or do research on how we were exploited during the colonial time and postcolonial time with the active support received from Walawwa families of the officially appointed local chieftains. They don’t care about how our rural heartland is exploited even today either! Instead, they tend to talk about the merits of foreign investment in getting us out of the debt trap we are caught in or a development imposed from above until the allocated money for projects run out.  They also utter the economic development manthrapassed down from the World Bank and other multilateral agencies using the same terminology, arguments and statistics. Hardly we see a critique of the same.

Even our education system is not designed to encourage young people for innovation and creativity. It does not provide the necessary tools and ideas or the encouragement to find out how we can utilise our own resources in the rural heartland? I give an example. People who grow coconuts dry them in the sun or barns and make copra. They sell copra to oil mill owners in provincial cities. My father used to do this and I still remember how I went with him to Matara to collect money from the mill owner. But now the world has changed. Many in Western countries use coconut oil and products made from such oil in food consumption as part of healthy diet. In super markets, there is coconut water along with fruit juices. Thus instead of making copra, our coconuts industry can be developed to bottle coconut water and supply to the market and export. Yet, there is no vehicle to do so perhaps except in the private sector. If there are rural development societies focused on the better utilisation of resources and the government provides necessary know how and probably the finances on low interest basis, small entrepreneurs can emerge from the rural heartland in hundreds and thousands.  In South East Asian countries like Indonesia and Thailand, there is a concept called Social Enterprise.  It is one that is used to articulate policy and programs by the non-government sector to help small entrepreneurs not only in terms of ideas, marketing and loans but also encouragement to start small enterprises. One organization has helped to run 700 petrol service stations in and around Bangkok.

Rural awakening and development cannot be at the expense of spiritual awakening and development. The two need to go hand in hand. Sarvodaya ideology and movement are based on this concept. They are respected internationally. Do we adopt the principles advocated by Sarvodaya in our development initiatives in the rural heartland? If not why not? It is an integrated rural development concept that combines welfare of people, spirituality and economic development. In any rural reawakening, we need to revive our interest on Sarvodaya and other indigenous development models. If our minds are set on distant dreams and fake lifestyle preferences, our villages and the life of sanity that they offered us around the tank, dagba and the paddy fields will be lost forever.

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More on tender scam at Education Ministry

 Oct 15, 2017

As exposed by us previously, top officials of the Education Ministry have conspired to grant the tender to provide GCE advanced level students with tabs to Metropolitan company in order for personal gains. 

For that, the additional secretary (procurement and construction) of the ministry and the chairman of the technical committee got together and prepared an evaluation report to the advantage of that company. At the procurement committee meeting to discuss that recommendation, despite attempts by the chairman, the committee said that since that company’s bid price was very high, discussions should be held with that company to get the prices reduced. The additional secretary did that and the company brought down the price from Rs. 7.4 billion to Rs. 6.8 billion. But, that was not at the level expected by them. It is a violation of tender procedures to discuss with only one bidder to get the bid price reduced.

In the meantime, another company that made a Rs. 5.5 billion bid and produced fake certificates for a certain accessory of the tab, instead of the FCC certificate requested by the technical committee chairman, came forward to fish in the troubled waters by bribing the minister and the chairman. The result was that on the minister’s instruction, the chairman and another technical committee member, a lecturer of Colombo University, got to work. The chairman held another meeting with the members and tried to convince them that the FFC certificate produced by another bidder, Abans which was removed at the technical evaluation, was a genuine one. That left other members surprised. They suspected his attempt to change their previous decision, and carefully observed the certificate together with the samples given to the ministry. They found them to be incorrect and contradictory.

Therefore, they rejected the chairman’s request and decided their previous decision be implemented.

Ashamed, the chairman had to accept their decision, and the attempt by him and the minister failed.
Recently, the procurement committee met to take a final decision, where the chairman made a lengthy speech justifying his decision. Following arguments, the committee decided to grant the tender to Metropolitan, whose bid was Rs. 3.2 billion higher than the lowest bid. Anyone closely watching the procurement procedure will understand that the officials tried to swindle public money, with political backing by the minister, additional secretary, technical committee chairman and the secretary of the education state ministry who was the overall coordinator.

This government came to power on the promise of eliminating fraud and corruption, but responsible officials are planning a massive swindling while the ministry secretary keeps silent, giving rise to suspicion that he too, is party to the conspiracy.

As we said previously, the additional secretary Anuradha Wijekoon, when he was at the Department of Motor Traffic, gave all its tenders to Metropolitan. Now, at the Education Ministry, he is trying to do the same. By citing a certificate applicable only to the USA, they are trying to swindle Rs. 3.2 billion of public money allotted for the education of the country’s children. The expression of interest letter awarding the tender to Metropolitan is given below.

We are ready to accommodate, if additional secretary Anuradha Wijekoon has anything to say about this.

The Myth of Lazy Jaffna Youth

2017-10-16

ot long ago, soon after the war, a common refrain about the Jaffna society was how hard working, thrifty and prudent its people were. But today, one often hears people decrying Jaffna society as having become lazy and spendthrift, landing itself in debt. It is true that Jaffna society is greatly mired in debt, but what are the causes of such indebtedness? How did the narrative around Jaffna youth change so much in the last few years? 
Both local and international pundits have attributed the said laziness to foreign remittances from the Tamil diaspora. Drawing upon their armchair analyses, they talk endlessly about the Tamil diaspora, with pots of money, channelling their savings to people in Jaffna, making them lazy and complacent. However, a careful look at the flows of remittance in recent years tells another story about how a majority of the Tamil society is struggling to cope with the economic crisis, and about how rural youth are responding to their family needs. 

Repressive Discourses

During difficult periods and times of crises, social discourses tend to invariably blame the people, particularly the oppressed sections of society. Not only do they distort hard facts on the ground, but also lead to further oppression and exploitation of those on the margins. 
If the young men are blamed for using mobile phones and “loafing around”, the young women are held responsible for the “cultural deterioration” of society, something you hear about repeatedly in Jaffna. As for the women, such a narrative is really about controlling women and their bodies, and restricting their freedoms. Furthermore, “cultural deterioration” becomes the umbrella argument to condemn youth in general, for how they dress, their absorption of popular culture from music to film, and of course their “laziness”. 
It is not just the elite pundits who deploy this crude analysis; it is proliferated through the media, and eventually internalised by rural community leaders and at times, the people themselves. What is more problematic is that even economists and policy makers,when pushed on questions about livelihood concerns and lack of economic growth in Jaffna,resort to such cultural explanations. 
In this context, any political economic analysis of the systemic challenges is ignored. The accumulation through dispossession with the proliferation of financial institutions is hardly considered despite the crippling indebtedness. Indeed, there is little reflection on the consequences of past policy choices and in turn societal responses. 
The Jaffna middle classes for example curse the rural youth, claiming that their laziness is reflected in the lack of day wage labour. Here, a young man or woman for whom they offer work once every now and then may not turn up. That is used as proof to blame the youth, and such blame always begins with an individual they know. They do not consider the precariousness of day wage labour, it does not exist if there is rain, and it is all at the whims of the middle class person looking for casual labour. So, what are the Jaffna youth doing in response to the crisis in their households? How are they approaching work?

"I am not providing this data to claim that Jaffna men are more perseverant than men in the rest of the country! Rather, my point is that arguments about “laziness” and “hard working” are shaped by cultural biases"

Out-migration and remittances

In my research in rural Jaffna, there is little found by way of regular remittances from the diaspora. The households that do get remittances, in fact, only get occasional bulk transfers for weddings and social occasions. Village societies in the diaspora also have put funds into caste-linked social institutions, particularly temples. In any event, such remittances from the diaspora are clearly on the decline. 
On the other hand, there is a considerable increase in the regular remittances sent by migrant workers. In the case of Jaffna, it is mainly young men, who make the arduous journey to the Middle East and places like Malaysia and work under harsh conditions to send a regular monthly remittance on the scale of Rs. 20,000 per month. 
So how are so-called lazy young men in Jaffna faring in comparison to the rest of the country? According to Census and Statistics data, the male population of Jaffna District is 2.8% of the national male population in 2016. Now, the Sri Lanka Bureau of Foreign Employment data only records departures for foreign employment and not the total number of foreign employed. The number of men migrating for employment from Jaffna compared to the rest of the country was 2.7% in 2010. With the deepening economic crisis in Jaffna out migration for foreign employment doubled between 2012 and 2014, from 3,621 to 7,817 departures. As a percentage of national migrant male workers, it was 4.1%, 3.3% and 3.7% in 2014, 2015 and 2016 respectively, which point to a much higher ratio of men from Jaffna willing to go work abroad. 
I am not providing this data to claim that Jaffna men are more perseverant than men in the rest of the country! Rather, my point is that arguments about “laziness” and “hard working” are shaped by cultural biases. The real situation of the economy and labour are better found in systemic explanations of social and economic dynamics. Certainly, if men are willing to go for gruelling work abroad, then a careful analysis of the local economy is required to find out as to why they cannot work in their own setting. 
Similarly, during field research in Jaffna and the Vanni, I have found that an increasing number of young women are willing to work in the exploitative garment industry. They are even moving to Free Trade Zones in the South when local employment is not forthcoming. A key lesson from this reality is that a sympathetic starting point with a political economic analysis may go a longer way in understanding rural social life than succumbing to conservative social discourses.

"Both local and international pundits have attributed the said laziness to foreign remittances from the Tamil diaspora"

Employment and Integration

In most villages in Jaffna, what people yearn for is a regular monthly income so they can ensure a stable home. That also explains the rising numbers of migrant and garment labour under severe conditions of exploitation and exclusion. 
The state’s reconstruction policies and the initiatives of donors and NGOs, focused on self-employment and self-generated livelihood programmes, have failed miserably in post-war Jaffna.Placing the burden on individuals to generate incomes after devastation by war meant incomes were irregular and eventually led to dispossession. Instead of recognising the failure of such a vision, the youth are blamed instead.   
A more meaningful approach to address both the economic problems in Jaffna and the aspirations of the youth would be investment to create local jobs that provide a regular income. That would mean investment to develop local resources and small industries. That would also require some critical reflection on the part of the economists, policy makers and other pundits who rarely consider the social and economic dynamics in rural settings.  As for the cultural life of youth, the elite classes and grumpy old men will always prefer the status quo rather than changes in society. That way, their dominant place in society is secure. Any serious change in Jaffna as in the rest of the country is likely to come from the youth, and we may want to listen to them before writing them off with moral judgments.  

President jolts security detail Confronts Jaffna protesters

By Sulochana Ramiah Mohan and T. Pratheepan-2017-10-15

President Maithripala Sirisena took his security detail by surprise after he threw caution to the wind and abruptly alighted from his official vehicle to confront a group of protesters in Jaffna yesterday.

The President was in Jaffna to inaugurate the National Tamil Language Day celebrations at the Jaffna Hindu College when the incident took place.

According to eyewitnesses the President had calmly walked up to the black flag waving protesters and inquired into their problems.

The protesters numbering around 75 and led by former MP M.K. Sivajilingam, along with Eelam People's Revolutionary Liberation Front (EPRLF) Leader Suresh Premachandran and attorney Gajendrakumar Ponnambalam told the President to settle the issue of the LTTE prisoners who are being held without charges.

They also told the President to halt the transfer of cases that are currently being heard in the Vavuniya Court to Anuradhapura.

President Sirisena was heard as saying: "Come let us discuss and see how the matter can be solved. The Tamils voted for me, you must remember."

Sivajilingam replied: "So how do you pay back your gratitude to the people who supported you."
Sivajilingam told the President that 160 Tamil prisoners held under the Prevention of Terrorism, Act (PTA) are languishing in prisons without trial.

He also lamented that another three Tamil prisoners are currently on a hunger strike in the Vavuniya Prison and their condition has worsened over the last few days.

The move to transfer the cases of these three prisoners from Vavuniya to Anuradhapura is not justifiable and carried out on racist lines, Sivajilingam further charged.

"You said you are working on national reconciliation and so why can't you sort out this simple matter of the three prisoners who are dying owing to the hunger strike they have carried out for the last 19 days. If you can't solve this simple problem, how can you solve bigger problems," Sivajilingam further said.

The protesters told that they were exhausted with discussions that were held from time to time regarding the prisoner issue and demanded immediate action.

"We will now wait for his response before informing the three prisoners currently on the 'death fast' in the Vavuniya Prison. What is needed is action and not discussions," Sivajilingam told Ceylon Today.

Meanwhile, the President, while addressing students later on said there is nothing like communications and discussions to deal with problems.

"When I speak of discussions the protesters insist on implementations. Many problems could be sorted out through proper communication," the President told the student audience at the National Tamil Language Day event held at the Hindu College.

President Sirisena was escorted to the venue amidst tight security that had been beefed up since Friday following a major hartal in the peninsula on that day. Organizers of Friday's hartal had planned a similar protest during the President's visit yesterday but were forced to have a re-think following a Court order that banned public protests in the area.

However, following yesterday's protest and related events it was also clear that the court order had been flouted.

‘If you cannot abide by laws of prisons, please get out’ Minister Swaminathan tells prison doctor racketeers..!

(Lanka-e-News - 15.Oct.2017, 12.30PM)  ‘If there are doctors who cannot carry out my orders ,they can leave and go .‘ Prisons reforms minister D.M. Swaminathan issued this  stern categorical warning to  the secretary of prisons , Prisons chiefs and doctors in the prisons. In other words the minister told them plainly  if these racketeer doctors leave it will be like good riddance of bad rubbish (GROBR ) !

 ‘Lanka e news’  news website is hurling  grave criticisms against the ministry of health and myself. I am a clean politician and I have promised to resolve this issue. I have instructed ,  the recommendations of three doctors are necessary to admit a patient to a prison hospital , but that instruction has not been  followed until today, ’ Swaminathan bemoaned.
 
Swaminathan a popular minister  , at  the meeting held on the 10 th at 4.00 p.m. at the prison headquarters with the participation of all the officers involved in this issue including the ministry secretary and  prison chiefs,  made the above  announcement  in no uncertain terms.

Three  doctors, Sujeewa Jayawardena , Tirani Atapattu and  Shanika Kottachi of the corrupt group of prison doctors  in reply said , they are answerable only to the ministry of health .

‘I am the ministry of prisons. I know the bloke  in the ministry of health who is supporting criminals.  I cannot walk on the road when this prison is being made a rogues’ den. If you are incapable , you can get out today itself.  I know with whose support the one who was  transferred with effect from 2017-01-01 is remaining back,’ the minister said to  his secretary while pointing the finger at Dr. Sujeewa Jayawardena .

Until the minister furiously questioned ‘ were Dr. Lakshman and Dr.Shanika sent here powered by  money?’ even   the secretary of prisons was not aware that Dr. Nirmali Thenuwara and Dr. Sujeewa Jayawardena who were sent out from prison  have been serving in the prison exceeding their stipulated period  with the support of the secretary to health, and the GMOA alias GOMA association alias ‘Government Medical Oppressors Association’. 

When Doctor racketeer  Shanika Kottachi tried to explain  , because Tissa Wimalasena alias Major  Tissa (suspect in Thajudeen murder)  Sarana Gunawardena  (extortionist)  and  Vaas Gunawardena (murderer) had to be hospitalized because insulin must be administered to them , the minister who  flew into a rage again , asked ‘ for administration of insulin , should every patient be warded?’ from the doctor racketeers .

Thereafter the prison doctors agreed to enlist the 9 nurses in the prison hospital and administer insulin injections to the diabetic patients at the out patients ward. 

It is significant to note despite these arrangements , criminals Duminda Silva and Major Tissa continued to be in the prison hospital even on the 12 th .  

It is clear evidence from the above scenario , ‘Kudu money’ (heroin filthy lucre) and corrupt criminal  Rajapakse power are holding  sway , and are overriding  even two powerful and popular ministers namely , Swaminathan and Rajitha Senaratne.  

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by     (2017-10-15 07:01:24)

Namal’s thuggery at Sumane ends like this!

- Oct 15, 2017

Former royal astrologer to the Rajapaksa family Sumanadasa Abeygunawardena has told several national newspapers and an international media that the next Rajapaksa member to take to politics would be a novice, who was already making certain experimentations. Seeing that, Namal Rajapaksa lost his temper and telephoned Sumanadasa.

Namal threatened and abused Sumanadasa in filth, saying, “Sumanayo, once you ruined us. Are you trying to ruin us again by encouraging Gota? Old man, I will destroy you.” Listening to the barrage for some time, Sumanadasa told him, “Namal Baby, do not say too much. I too, have something out of that file.” Namal hung up without saying another word.

On the following day, Sumanadasa telephoned Mahinda Rajapaksa. The latter, in his usual cunning self, said, “Sumane…How are you? Why don’t you come this way anymore? What has happened?”

“Leaving alone coming to see you, how can we look your way Mahinda Mahattayo, when Namal Baby talks to us this way?” he answered with a question, and related to him what has happened.

Mahinda told him, “Don’t take that seriously, Sumane… Don’t you know the ways of young lads? When they become angry they say whatever comes to mind.”

Sumanadasa advised him, “Mahinda Mahattayo, if you can, send him to another country. If he remains, he will not be able to do politics. At this rate, he will go to jail and even lose his civic rights.”

We do not need any astrology to repeat Sumanadasa’s advice to Mahinda. We have been saying that Namal will end his journey after losing his civic rights. 

We have some information about the file that made Namal shut up. That is about a serious crime that has been concealed by spending Rs. 20 million. Maithripala Sirisena and Mahinda Amaraweera too, are behind the cover up of this crime. Lanka News Web is continuing with its investigations. Once the information is verified, we will bring to you details of that serious crime.

Sri Lanka: Death of senior journalist

( October 15, 2017, Colombo, Sri Lanka Guardian) Senior journalist, defence correspondent and Sunday Observer News Editor Ranil Wijayapala (42), passed away yesterday after a long illness. An old boy of Taxila Central College, Horana, he joined the Daily News in February 1997 as a journalist and later became its News Editor.

During a journalistic career spanning over two decades, he covered many beats including Parliament, politics, crime, education and health. But his specialty was defence. Thrust into journalism at the height of the conflict, he earned a name as a brilliant defence correspondent for both the Daily News and the Sunday Observer. His weekly defence column with up-to-the minute analysis in the Daily News was eagerly awaited not only by the general readership but also by the defence establishment and foreign observers. He was no armchair analyst – he walked the talk, reporting from all the major battles of the Eelam War until the final battle at Nandikadal. He was also a versatile feature writer.

He joined the Sunday Observer in 2009. While working as a senior reporter of the Sunday Observer, he was appointed News Editor and held that position until his untimely demise. He had a remarkable nose for news and guided colleagues and reporters to produce exclusive stories. He is survived by his wife Sriyani and two young sons Dinidu and Uvindu.

The funeral will be held on October 16 (Monday) at 3 p.m. at the kandanapitiya cemetery, Padukka. The remains are at his residence at Ranaviru Ravi Krishan Mawatha, Kandanapitiya, Bope, Padukka (9 Km from Meepe on Ingiriya Road).

The bond robbery and Central Bank’s reputation: Yahapalana Government should stop playing hide and seek

This writer in March 2015 drew the attention of the Government to the emerging catastrophe by noting that the bond explosion in 2015 caused far worse damage to the Central Bank than the bomb explosion of 1996

Offering Rs. 1 billion and ending up taking Rs. 10 billion

Monday, 16 October 2017 

Immediately after the Treasury bond auction on 27 February 2015, the news of a massive impropriety that had taken place in the auction spread across the market like a wildfire. The news said that the Central Bank had offered to borrow Rs. 1 billion through a 30-year Treasury bond, but ended up in borrowing 10 times of that, amounting to Rs. 10 billion.

This was unusual compared to the previous practice of the bank that not more than two to three times of the amount on offer was taken. Then, it further said that a half of the amount borrowed, namely, Rs. 5 billion, had been taken from a primary dealer connected to the newly appointed Governor of the Central Bank at a spuriously average bargain price of Rs. 91 per 100 rupee bond when the going market price of a 30-year bond was around Rs. 120.

Bond interest rates are different from their fixed interest rates

This particular bond had carried a fixed interest rate of 12.5% which the Government had promised to pay the bondholder annually on the face value of Rs. 100. However, bonds are traded in the market and depending on the market price, the actual interest yield, known as the bond interest rate, would differ from the fixed interest rate.

Since this bond had a market price of Rs. 120 per 100 rupee bond, the applicable bond interest rate was about 9.2% per annum. In other words, if an investor buys this bond for Rs. 120, he would get in interest income of Rs. 12.50 and when it is expressed as a percent of the purchase price, it amounts to a yield rate of 10.4%.

When the income tax of 10% paid in advance is deducted, the after-tax bond yield is about 9.2% which is the rate which the bidders of the bond have to quote in the bid document. The Central Bank had advised all the primary dealers informally that they should not upset the prevailing interest rate structure in the economy. Hence, they were supposed to bid at an after-tax interest rate of around 9.5% or at a price of Rs. 116 per 100 rupee bond.

Online bond auction system

These bond auctions are held electronically by using a dedicated telecommunication line between the Central Bank’s computer system and those of the primary dealers. The auction starts at 8.30 in the morning of the auction day and automatically closes at 11 a.m. Once a primary dealer has submitted a bid to the system, he is bound by the rules to honour it even if he may have made a mistake either in the price or the amount. Hence, primary dealers are extra careful when bidding not to bid at rates or for amounts which they cannot accommodate. Any extension of the auction time is done only if there are interruptions to the telecommunication lines but even then, they have to be certified by Sri Lanka Telecom, the service provider.

Central Bank could have generated a premium income for Government

The bid sheet of the bond auction on 27 February 2015 shows that almost all primary dealers had submitted their bids as per Central Bank’s informal instructions. The prices quoted by them had ranged between Rs. 104 and Rs. 119 per 100 rupee bond generating a premium income for the Government. In fact, if the bank had accepted only Rs. 1.3 billion, it could have issued the bonds at prices ranging between Rs. 104 and Rs. 119 generating a premium income of Rs. 94 million for the Government. Since the weighted average bond interest rate applicable to that issue is around 10.5%, it would also not have disturbed the prevailing interest rate structure unduly. If the bank had accepted only Rs. 1.3 billion from the auction, any additional fund needs could have been raised by using its practice, known as direct placements, of offering the balance requirement to primary dealers at the weighted average rate of 10.5%.

Since it was the prevailing market rate for this particular bond, no primary dealer would have been able to make any undue profit by selling them immediately to other investors. However, this could not be done due to three arbitrary decisions taken by the Governor on that particular day without the sanction of the Monetary Board, the legal body which owns the Central Bank with powers to make such decisions.

Increasing interest rates effectively before the bond auction

The first was the increase in the interest rates effectively contrary to the decision which the Monetary Board had taken four days ago not to change the interest rate structure until it will review the conditions of money supply, credit levels and inflationary pressures late in March 2015.

As revealed at the Second COPE inquiry into the bond scandal, Governor Mahendran had walked into the regular morning meeting of the Market Operation Committee at about 8:30 a.m. on the day of the bond auction and made a surprise announcement that he wanted to increase interest rates and for that purpose, he wanted to abolish the lower interest rate payable to commercial banks which had been using the Central Bank’s standing deposit facility for parking their excess money for more than three occasions a month.

The normal standing deposit facility rate of the bank was 6.5%, but to force banks to lend money to customers instead of safely parking with the Central Bank, those who had used the facility for more than three occasions were paid a lower rate of 5%. Since almost all banks had made use of this facility, the average market interest rate was around this lower end at 5%.

When the decision was taken to remove it, the average market interest rates would invariably jump to its higher bound, namely, 6.5%. Market watchers believe that this decision, arbitrarily taken by Governor Mahendran against the determined policy stance of the Monetary Board, would have justified the interest rate increase that was to take place later in the day.

Throwing away a valuable weapon to control the market misbehaviour

The second and third decisions were also taken arbitrarily by Governor Mahendran yet in another bizarre behaviour he had demonstrated on that day. That was to storm into the Public Debt Department when the auction was taking place at around 10.45 a.m., a move which no Governor had done previously.

The evidence before COPE has revealed that he had met both the Superintendent and the Additional Superintendent of Public Debt and announced that from that auction onward, all moneys needed by the Government would be raised only through auctions and the direct placement system which the bank had been adopting since 1997 would be abolished. In effect, these two decisions effectively took away from the Public Debt Department a powerful weapon it had possessed in order to prevent collusive activities by primary dealers to increase interest rates and thereby corner the market.

The decision taken by the Treasury Bond Tender Board that day and all issues of Treasury bonds thereafter were a testimony to the occurrence of such collusive activities. This decision not only ruined the otherwise smoothly functioning market, but also led crafty primary dealers to make full use of it to profit at the expense of the other investors, mainly, the state managed funds. However, two and a half years after the direct placement system was abolished, the Central Bank reintroduced it in July 2017 when it was found that without that weapon, it could not control the market (see: http://www.ft.lk/columns/issue-of-treasury-bonds-cb-has-finally-vindicated-direct-placements/4-635047 ).

Flooding the Public Debt with bids

Within minutes of Governor Mahendran’s leaving the Public Debt Department, bids began to pour in from the primary dealer, Perpetual Treasuries, in excessive amounts and at spuriously low prices. Just before the close of the tender at 11 a.m., four bids were submitted by Perpetual Treasuries in its own name for Rs. 2 billion at prices ranging from Rs. 92 to Rs. 98; three bids were submitted by another primary dealer, Bank of Ceylon, for Rs. 13 billion on behalf of Perpetual Treasuries at prices ranging from Rs. 87 to Rs. 90.

This was an unusual bidding pattern since the Central Bank had offered to the market only Rs. 1 billion and the Bank of Ceylon had previously bid for other customers at prices ranging from Rs. 109 to Rs. 119. The excessive biddings and all bids coming after Governor Mahendran’s announcement that direct placements had been abolished and all the fund requirements of the Government would be met out of the auction in question raised the suspicion that the primary dealer Perpetual Treasuries had access to exclusive information which was not available to other primary dealers.

A Governor taking decisions for a Tender Board

Then, repeating his bizarre behaviour of the day, Governor Mahendran visited the Public Debt Department in the company of two other Deputy Governors at about 12.30 pm. The evidence placed before the COPE has revealed that he had access to the bid sheet, perused it and then directed the Superintendent of Public Debt to accept all the bids. Had she acceded to it, out of the bonds of Rs. 20 billion to be issued, Rs. 15 billion would have been for the Perpetual Treasuries. However, after the Superintendent and the Additional Superintendent had protested, Governor Mahendran had once again perused the bid document and instructed that up to Rs. 10 billion should be accepted. In that list, a half of the bids accepted had been from Perpetual Treasuries.

Displaying the lack of professional due diligence

In this case, on a number of counts, the Governor and the senior officers of the bank had not demonstrated that they had acted with due professional diligence. First, the Government, it appeared, needed money to pay outstanding bills and that was a liquidity requirement. For that purpose, a prudent central bank would not have raised a 30-year bond and committed the Government to pay interest at 12.5% for all these years. Short-term funding requirements should be met out of short term borrowings.

Second, the Central Bank is the agent of the Government and before committing the Government to a high borrowing liability, as the bank had done in the past, it would have got the concurrence of the General Treasury. Instead, it was an arbitrary decision taken, keeping the Treasury completely out of the picture. Third, the Governor deciding on the price as well as the amount of the auction vitiates the role of the Tender Board which had been appointed by the Monetary Board to decide on the tenders.

Fourth, direct placements had been abolished by an arbitrary decision of the Governor without assessing its merits and subsequent consequences. Fifth, the Monetary Board, the authority on these issues, had just become an active defender of the whole impropriety thereby allowing the reputation and the credibility of the bank to be eroded beyond repair.

Losing confidence of investors

But, this single episode caused to erode the Central Bank’s reputation and credibility both within Sri Lanka and outside. The Government led by Prime Minister Ranil Wickremasinghe, instead of taking prompt action to control the damage, fought tooth and nail, to defend the Central Bank’s action. Many foreign investors in the Government securities market became agitated and shocked. The impression that a few selected individuals, with the connivance of the top leadership in the bank, could defraud all other investors with total impunity caused them to withdraw from the market. Thus, within 10 months, the foreign investments in Government securities which stood at $ 4.5 billion as at the beginning of 2015 fell to $ 2 billion. But the Government, more specifically the Ministry of Finance, and the Monetary Board did not seem to have taken notice of the haemorrhage of the country’s foreign reserves putting pressure for the exchange rate to depreciate and forcing the Government to seek a bailout package from IMF.

A bond explosion far worse than a bomb explosion

This writer in March 2015 drew the attention of the Government to the emerging catastrophe by noting that the bond explosion in 2015 caused a far worse damage to the bank compared to the bomb explosion that took place in 1996 (available at: http://www.ft.lk/columns/from-bomb-disaster-to-bond-disaster-how-to-restore-the-lost-reputation-of-the-central-bank/4-398709). There was very good reason for this writer to say so. In the bomb explosion, the bank managed to restore normalcy within a few months. Also, the Central Bank employees demonstrated the highest degree of integrity when they were under attack by terrorists. This writer recalls that the officers attached to the Currency Department, amidst the fear of being buried alive by a collapsing building, put all the currency which they had taken out for the day’s business back to trunks and safely deposited it in the vaults before leaving the building that was in flames. However, the dishonesty displayed by some officers of the bank during the first bond explosion and the subsequent ones that followed within the last two-year period would make these honest officers hide their heads in shame.

Governor alone is responsible under the law

It is usual for Governors to blame their officers for the follies that they commit as was done by the Bank of Thailand Governor Rerngchai Marakanond when he was taken to courts for losing the nation’s foreign reserves in a futile attempt at fixing the Baht-Dollar exchange rate in 1997. The Governor Rerngchai took the position that it was his officials who had advised him to sell dollars in the market. But the courts did not accept his plea and found him guilty of negligence. John Exter, the architect of the Central Bank of Sri Lanka, knew of this possibility. Hence, he introduced in section 22 of the Monetary Law Act that the Governor is responsible for all action done by the officers of the bank, whether they are good or bad, as the CEO of the bank. Hence, in the Exter Report, he qualified that the person to be appointed as Governor should be a person of ‘unquestioned integrity’.

Continuing to play hide and seek will be to the Government’s own peril

The Yahapalana Government played hide and seek throughout the last two-year period with respect to a number of bond explosions that had taken place in the country. When the pressure was mounting from the civil society, it just came out from the hiding place and pretended to seek the culprits. But after the pressure had subsided, it began to hide and play with the culprits.

With the new evidence which is now in public domain, the Government can no longer play this game. If it does so, it will do so to its own peril. And if it continues to hide and seek, it will be the biggest disappointment for a large number of people who had voted this Government to power in 2015.
(W.A. Wijewardena, a former Deputy Governor of the Central Bank of Sri Lanka, can be reached at waw1949@gmail.com.)

President kneels down before criminal who forced a teacher to kneel down –appoints him as SLFP electoral organizer !

(Lanka-e-News - 15.Oct.2017, 12.30PM)   President Maithripala Sirisena who came to power on 2015-01-08 on the votes of 6.2 Million people who hoped he would ensure  good governance in the country based on his grandiose promises , has instead acted  in a most shameless deplorable despicable manner  by appointing a discarded confirmed criminal   Ananda Sarath Kumara as the SLFP organizer for Anamaduwa electorate . Even the infamous Machiavellian ex president Mahinda Rajapakse best noted for such  rascally and criminal propensities did not indulge in such a villainy as did the incumbent  president Maithripala .

Sarath Kumara became most notorious as a scoundrel who during the nefarious corrupt Rajapakse decade forced a lady teacher of Nawagathegama Nawodya school , Anamaduwa to kneel down on 2013-06-14 before him . Sarath Kumara was even punished by court owing to this despicable  hooligan conduct .

The former organizer Priyankara Jayaratne (ex state minister ) is now with Rajapakse group , therefore  he had been dismissed and this uncouth barbaric brute  Sarath Kumara who not only insulted  the teacher openly but even the noble profession was appointed by Maithripala the SLFP leader.

Following huge protests staged across the country at that time against this most rowdy conduct of Sarath Kumara the two legged beast , he was hauled up before court and punished. The court ordered Sarath Kumara to pay Rs. 50,000.00 as crown cost ,as well as  a further sum of Rs. 300,000.00 as compensation to the victim , and in addition sentenced him to two years in jail suspended to 7 years. 

That court verdict was delivered on 2014-05-12 during the corrupt nefarious Rajapakse decade . Based on that Sarath Kumara the ‘manimal’ was not granted the electoral organizer post , and at the subsequent election  he was not given nomination even by  notorious Mahinda Rajapakse . Mind you , Sarath Kumara is still serving the suspended sentence.

It is despite these glaring facts and lurid details  , Maithripala Sirisena of all people ,  the so called staunch advocate of  good governance  , decided after becoming the leader of the SLFP to appoint this two legged brute  Sarath Kumara as the Anamaduwa electorate organizer. In the circumstances , won’t  it be less shameful  for  Sirisena to stand nude before   the 6.2 Million pro good governance  voters who elected him to power and search for the hidden that was plucked from him by the scavenging crows and show his disappointment than to appoint such a discard as his Anamaduwa  electoral organizer ? It is being widely questioned, whether aren’t there better men and women in the country for the already crooks infested  SLFP  than only rascals ,rogues , pariahs and criminals ?

This reprehensible  move of the president is not only an insult to all the teachers of SL but the entire female race , said Josef Stalin , the secretary of All Island Lanka teachers association  .  He will be whipping up the support of all the teachers of SL to protest against the appointment of such a criminal as an electoral organizer , who was sentenced to jail  for treating  a teacher most disdainfully and  making her  kneel down  , Stalin speaking to  Lanka  e news revealed .

Stalin recalled  , Maithripala in much the same way after becoming the leader of the SLFP appointed another notorious kudu Lansa too as an electoral organizer , whom  even Mahinda Rajapakse did not appoint. 

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by     (2017-10-15 07:12:01)

Mangala leaked my video to the media – IGP

Oct 15, 2017

IGP Pujith Jayasundara says it is media minister Mangala Samaraweera who had given to the media the video which shows him threatening and attacking elevator operator at the police headquarters Samarakoon Banda.

He has told the CID on the 13th in an angry tone, “I know that a senior DIG at the headquarters gave the video to minister Mangala Samaraweera. Then, Mangala got a coordinating secretary of his to give it to a website operating from overseas (the IGP has named the person and the website). All of them are trying to expel me. That will not work. The president and the prime minister are protecting me fully.”

 

He was almost in tears when he went on, “You all have seen the clip? Have I assaulted Samarakoon Banda? I only touched his collar. Did I say I would rape that policewoman? (She was there at the meeting) I said that I would ruin you too. Now, all of them are getting together to ruin me. That does not mean I was to be raped.”

 

When the IGP started narrating his version of the story, a police officer in a backseat said, ‘Keliyaa Thaappeta’, which sent Jayasundara and all the other into laughter.

 

It was Lanka News Web which broke the news of the incident. We do have the CCTV footage of the entire incident, but we published only an edited one, to prevent any disruptions to future legal action. We will keep a close watch on the action to be taken with regard the complaint filed by Samarakoon Banda to the police commission with our legal support.

Excise Department Ransom Scam: Helen Urges Victimized Parents To Come Forward

OCTOBER 16, 2017

Helen Meegasmulla the recently appointed Commissioner of Excise Department of Sri Lanka has urged all those who have been victimized by officers of the Excise Department in the recent past to bring forth their cases to her in person.

Helen Meegasmulla

When Commissioner Meegasmulla was informed that several victims had contacted Colombo Telegraph after it published the story “Excise Department Scam: Victimized Parents In Fear As Children Used For Ransom” she said: “Please do inform all victims to personally visit me with their cases and I will ensure that each and every one of them are investigated further. I also understand that some parents may be worried that they will be further victimized for coming forward. I would assure them of confidentiality and also protection if needed.”

Meegasmulla further went on to say “It has been brought to my notice that there have been several cases where officers serving under me now have been extorting huge sums of ransom monies from parents of youth whom they have apprehended. I recently visited many branches where these alleged officers are stationed and have given them stern instructions that this type of reported behaviour must be stopped immediately.”

A parent victim contacting Colombo Telegraph after reading our published story confirmed that he was forced to pay Rs one million to officer Chaminda at the Park Lane office in Borella. This was after an initial amount of 15 lakhs was demanded.

Thilak Dissanayake

“Excise Officer Chaminda on several occasions kept calling his superior Inspector Thilak Dissanayake and was obtaining instructions on the payment of ransom monies. He then went on to say that Inspector Dissanayake had instructed Rs 10 lakhs to be paid as a final sum if not my son will be going to jail” he said.

In an earlier reported incident another parent victim submitted telephone voice recorded conversations to Colombo Telegraph of Inspector Thilak Dissanayake demanding ransom money. The authenticity of his voice in the recordings was confirmed by a reliable source employed within the Excise Department.

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Recruitment interviewing in Sri Lanka: Problems and prospects

Monday, 16 October 2017 

We conduct interviews to recruit people to organisations. One common myth is that you can sit in an interview panel without any preparation. Some even sarcastically ask, “What is there to learn about interviewing?” It certainly goes beyond common sense. I have seen in many Sri Lankan institutions, interviewing is taken rather lightly and as such obviously selecting someone who is not the most deserving. Today’s column is an attempt to shed light on the nature and features of recruitment interviewing in the Sri Lankan context.

 

Overview

‘When you hire people who are smarter than you, you prove that you are smarter than they are’, so said Robert Henry Grant. Hiring the right person to the right job is important in order to achieve right results. The old adage ‘people are your most important asset’ is not always accurate, says Jim Collins. He claims that rather than “people”, it is the “right people” that make up the best asset of an organisation. Crucial challenge is how.

According to the United States Department of Labour, a bad hiring decision equals 30% of the employee’s first year’s earning potential. In Sri Lanka too, I have personally come across several situations, where companies had to pay badly in the wake of wrong person being on-board. We see such cases prominently featured in media as well. 

 

Right hiring 

It is pertinent to mention what David Oglivy, as an advertising tycoon, had to say with respect to hiring: “If each of us hires people who are smaller than we are, we shall become a company of dwarfs, but if each of us hires people who are bigger than we are, we will become a company of giants.” In order to hire people with potential, the hiring process has to be professionally designed and executed.

“My company’s assets walk out of the door every evening,” said Narayan Murthy, the founder of Infosys. With such a great emphasis on human capital, it is critical for every organisation to resort to means that offer quality recruitment solutions at competitive costs. This is where the realm of hiring starts.

If you compare hiring to a process, there are three key elements, namely, ‘recruitment’, ‘selection’ and ‘placement’. Recruitment is the way in which an organisation tries to attract the people from whom it will ultimately make a selection. Placement is the final step of assigning a suitable job to the selected candidate. 

 

Interviews in a nutshell

An interview can be regarded as a critical step in the selection process. It is in fact a conversation between two or more people (the interviewer and the interviewee) where questions are asked by the interviewer to obtain information from the interviewee. Effective interviews provide an additional basis for comparing candidates, supplementing information gleaned from the applicant questionnaire and investigation.

Interviewers need to do three things in an effective interview, viz, define, discover and decide. They should know clearly what they are looking for in the ideal candidate. Then they need to check whether those attributes are present in the candidates. Finally comes the decision. 

The above process can be further elaborated by referring to its stages. They include: Identify: Defining the requirements, Specify: Developing the person specifications and Codify: designing the ways of testing the required specifications. In doing the above, job analysis is a vital exercise that need to be performed.

Different types of interviews are used, the one to one, the sequential interview, the panel interview and group interviews depending on the needs, customs and time constraints of the employing organisation. Their contents and conduct may very as given below: 

Structured interview: This is an interview that includes a predetermined set of questions that is addressed to each applicant. Before the interview is commenced this set of questions needs to be determined. Questions are direct questions to get the direct answers, and desired answers or expected answers are also developed. 

An example of the structured question for the post of Management Trainee could be “tell three key functions that a manager has to perform”. Structured interviews have the advantage of providing the same information on all interviewees, ensuring that all questions are covered with all interviewees and minimising the personal biases of the interviewers

Unstructured Interview: Here the interviewer generally follows no set of format. The lack of a structure allows the interviewer to ask follow-up questions and pursue points of interests as they develop. The interviewees for the same job may or may not get the same or similar questions. A few questions might be specified in advance, but they’re usually not, and there is seldom a formal guide for scoring answers. This type of interview could even be described as little more than a general conversation.

Semi-structured Interview: This is a combination of the above two where there is a skeleton structure allowing flexibility to the interviewer to probe further when required. The structure prevents the interviewer to go in a tangent yet allowing the discovery of the candidate better. This form is quite popular in Sri Lanka. 

Apart from the above, stress interviewing and behavioural interviewing are two other specialised forms with specific intents. In a stress interview, the interviewer seeks to make the applicant uncomfortable with occasionally rude questions. The aim is supposedly to spot sensitive applicants and those who with low (or high) stress tolerance. This type of interview is more suitable for jobs which are composed of highly stressful duties such as military, security, and peace keeping, etc. 

 

Behavioural interviewing

Behavioural interviewing is my favourite form. Here the emphasis is on the behaviour demonstrated by the candidate. In many a time, I have seen a candidate with an impressive CV nicely printed in colour is not so impactful in the face of a proper behavioural interviewing. It is essentially probing the behaviour of a candidate in the past. We call it as focusing on “critical incidents”.

“Tell me a situation in the past where you had to achieve a result under heavy pressure”. Obviously, this is not a hypothetical question and the candidate cannot create an imaginary answer. It is the smartness of the interviewer to allow the free flow of expressions from the candidate and probe deeper based on the answers. It should be done in a friendly and encouraging way rather than becoming a “criminal investigator”. 

The key advantage of a proper behavioural interview is that it will reveal the authentic nature of the candidate with associated strengths and shortcomings. It takes more time than a typically rushed casual interview and as such some busy managers avoid resorting to it. Also, you need to know what to check with regards to the job in hand, and the key dimensions of the job and that’s why the interviewers need some preparation. The problem in Sri Lanka is that the interviewer reads the CV for the time during the interview and browsing is done while the candidate is answering to a question. 

Hence the pre-requisite for a proper behavioural interviewing is preparedness from the interviewers and also the sharpness in asking, listening, probing and logically concluding. That is why every manager cannot automatically become an effective interviewer. 

 

Issues with the interviewing process

There can be many issues associated with the interviewing process. Let me summarise them as five “I”s, namely, inability, inconsistency, irrelevance, irrationality and interference. Let’s discuss these in relation to Sri Lankan organisations.

Inability is obvious when the top-most people just rushes through the interview without any flair for the process. The danger is that the leader’s decision may be the final decision despite the concerns by others. 

Inconsistency is very common in Sri Lanka where connections are considered more important than competencies by some leaders. You pick your favourite despite the competency gaps, leaving more deserving candidates. 

Irrelevance is one headache at some interviews where the interviewing panel gets carried away with irrelevant details missing out vital facts and critical aspects. A smart candidate can manipulate such a situation if the panellists go on a tangent focusing only on one area.

Irrationality is also common among some leaders where they look for the perfect candidate without willing to pay the asking rate. It is an illusion to attempt to get the best in the market whilst being reluctant to reward. Also there are the situations where you pick a candidate similar to your appearance or coming from your college or village without any rational justification. 

Interference is rampant in Sri Lankan organisations. Particularly where a clear and coherent policy framework is absent. There will be outside influence to the interview panel through a prior message from a powerful person at the top to intentionally pick a particular preferred candidate irrespective of his/her competencies. The panel in this case becomes a cat’s paw of someone else. 

It remains to be seen whether the impact of above “I”s can be minimised in the context of Sri Lankan organisations. 

 

Way forward 

Interviewing is an art and a science. One needs to have expertise as well as experience in successfully handling recruitment interviews. Defining the right requirement, discovering the right match and deciding on the right candidate are the vital steps to follow. Sri Lankan managers, administrators and leaders alike can improve on all these aspects in order to ensure that the right person handling the right job in the right manner in producing right results. 

 

 

(The writer can be reached through director@pim.sjp.ac.lk, 

president@ipmlk.org or www.ajanthadharmasiri.info.)