Central Province Spends Only Rs 336 million from the
Rs 942m Available

The Central Provincial Council (CPC) budgeted Rs 942m for fiscal 2008 but up to mid November 2008 it had managed to spend only Rs 336m (36%). The Assistant Secretary to the CPC Ministry of Planning Mr. H K M Karunarathne presented these figures at a recent meeting of the Kandy District Coordinating Committee chaired by the then Chief Minister Sarath Ekanayaka.

Details of under-spending revealed that all five ministries of the CPC have under-spent their respective allocations. The Chief Ministry under Mr. Ekanayaka had spent only Rs 102m (40%) out of Rs 254m. The Chief Ministry is also responsible for Education, Transport, Law and Peace, Finance and Planning, Local Government, Tourism, Trade and Commerce, Culture, Environment, Housing, Human Resource Development and Local and Foreign Investment Coordination.
The Ministry of Agriculture that was under Mr. Jayaratha Dissanayka had an allocation of Rs 41m but had spent only Rs 23m (56%).

The Health Ministry led by Mr. Champika Wijerathne that also has Social Welfare and Probation under its purview received Rs 120m and had spent Rs 33m (28%) by the end of November.
The Ministry of Highways, Power, Energy and Cooperatives had spent Rs 117m (38%) for an allocation of Rs 308m. The Minister in the recently dissolved CPC was Mr. Ediriweera Weerawardena.

The Ministry of Industries, Sports, Youth Affairs, Estate Infrastructure Development, Hindu Cultural Affairs, and Tamil Education that Mr. S Arulsamy headed received Rs 88m but managed to spend only Rs 38m (43%).

The review also revealed that 3,161 projects had been slated for funding in fiscal 2008. Of that number only 1,115 (35%) had been completed by November 20th when the review meeting was held. However, in a reply to a question that The Kandy News raised officials claimed that work has commenced in the balance 2,046 and that much of the balance funds will be utilized. However, they conceded that given the limited time of one month available some of the funds may have to be returned to the Central Government that provided the funds.

Strengthening Women is Key to Poverty Alleviation Says (former) Chief Minister Sarath Ekanayaka

Developing and strengthening women of the Central Province is one of the most effective ways to reduce poverty said Mr. Sarath Ekanayaka (former) Chief Minister of the Central Provincial when he addressed twenty women from the province who are either in business or activists in civil society organizations on the eve of their departure to Kerala India on a study tour. The Central Province Ministry of Industries organized the visit. In India the group studied how women have been empowered through a program called Kudumbashree (Household Prosperity). The Kerala Institute of Local Administration (KILA) hosted the Sri Lanka visitors.

The Kudumbashree Program works through grassroots women's association. These women's groups establish businesses that have the backing of women's networks and government agencies.

The Sri Lanka group was shown how women from low income groups in Kerala have been empowered in both in the field of business and commerce as well as in the field of politics and governance. The participants told The Kandy News on their return that the study program was very particular to stress the interdependence of the two types of empowerment; that political power paved the way to economic empowerment and vice versa. Most important, both these goals were achieved in the context of successful decentralization and devolution of power in Kerala.

Talking to The Kandy News some of the delegates remarked that the visit started in classroom lectures and discussions but the most instructive part were the field visits, “We visited Erumapetty village Gram Panchayat office where we met the President who was a man and the Vice President who was a woman. The president had very high praise for the Kudumbashree women. He said it was very easy for the Kudumbashree women to get loans from banks. The Panchayat (Village Council) helped by giving land/premises free to establish enterprises and banks readily gave small loans. The reported repayment rate is 100 percent.”

“Next we visited the Angamalai Municipal Council where the mayor was a woman, the deputy was a man and the opposition leader was also a woman. From the discussion we had with them we got the impression that after initial political antipathy towards each other the government group and the opposition began to cooperate with each other especially because of the pressure that the Kudumbashree women exerted on the Council.”

“Our program ended with visits to a computer center, a workers-owned nutritious food production facility and a health activity group, all three of which were under Kudumbashree. Needless to say these venues must have been chosen partly to showcase success to us. But we could not help but be impressed by what they have archived and more especially by the potential that the program offered for the advancement of women in particular and the poorer communities in general.”

CPC Ministry of Industries under the leadership of its Secretary Mrs. Shirani Weerakoon is making a bid to emulate the Kerala model in the Province. She is encouraging the formation of Kantha Bala Mandala in villages and enlisting the resources of the Central Province Women Chamber of Commerce and Small Industries to introduce women to business ventures. The Asia Foundation and the Federation of Commerce and Industries assisted the members of the Central Province Women's Chamber of Commerce and Industries who participated in the above program.

Mahamayan Liesha Chanadrasena Chairs SLT Board

An old girl of Mahamaya Girls College Liesha de Silva Chandrasena is the new chairperson of Sri Lanka Telecom and Sri Lanka Mobitel. She also serves as the chairperson of all subsidiaries of Sri Lanka Telecom PLC. Before taking over as chairperson she served from 2006 as a member of the Board of Directors of SLT and Mobitel.

Mrs. Chandrasena is an Attorney-at-Law who hails from a family of lawyers. Her father was a leading criminal lawyer in Kandy in the firm De Silva and De Silva. Her two brothers and one of her sisters are also lawyers and so is her daughter. Her husband is a private medical practitioner.

From 1978 to 1987 Mrs. Chandrasena was in active practice. Thereafter she served as an Administrative/Legal Manager and Company Secretary in the private sector up to 1999. Currently, she is in active practice in the civil courts and handles company secretarial work of a number of private companies and serves as a partner of a family-owned legal firm.
Mrs. Chandrasena is particularly proud of the fact that SLT came second in corporate performance in the Business Today Top 10 2006/07 awards competition. The award for which Sri Lanka's quoted companies compete is based on financial performance and other corporate performance. Under her leadership SLT sponsored with an outlay of Rs 10 million the Sri Lankan squad to the Beijing Olympics.

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Black flags, closed shops and boycott threatened

KMC Opposes Government Move to Give Car Park to Private Businessman

The publicly-funded KMC car park that has a troubled history and so far has failed to make an appreciable impact to ease the parking problem in Kandy town has now provoked a major confrontation between the KMC and the Rajapakse administration following the latter's decision to hand it over to Property Finance and Investment Kandy (Pvt) Ltd on a fifty year lease. The owner of the company businessman Thusitha Wijesena is the developer of The Kandy City Center that President Mahinda Rajapakse is scheduled to ceremonially open on January 29, 2009.

Mr. Wijesena's company currently has the contract for managing the car park as well as all the parking in the Kandy town. All four political parties, UNP, PA, JVP and SLMC on the Council are opposed to the handover of the car park to the company. They point out that it stands on KMC land, the Council built it using the rate payers' money and an ADB loan and that the loan is serviced using Kandy tax payer money. In protest they are threatening a boycott of the opening ceremony of the Kandy City Center, close shops and raise black flags.

The government has decided to make the car park a BOI project and handover the facility on a 50 year lease to the company. At the end of that period the company will own the car park that has 862 spaces. It is not clear if the value of the lease that includes street parking will remain at Rs 34.8 million per year that was agreed upon between the company and KMC in 2005. At present the KMC pays Rs 11.6 million per year to service the Asian Development Bank (ADB) loan. The original hope of the KMC was to make the car park a revenue earner but for now it has become a revenue loser.

The KMC officially learned of the decision only on Thursday 08th January 2009 when the Mayor received a letter from the presidential secretariat signed by the Secretary to the President Lalith Weeratunga announcing the cabinet decision. The KMC met in a special session on Thursday January 15th and unanimously decided to protest against the move, appeal to the president to revoke the decision and if no redress was found to go to courts. Opposition Leader Thilina Tennakoon (PA) undertook to personally appeal to the president.

The KMC handed over the management of the car park to Mr. Wijesena's company effective August 21, 2005 on a lease. However, the lease holder filed a case against the KMC soon after taking over alleging breach of contract. The court has ordered the two parties to go into arbitration to settle the dispute. This is yet to be completed. In the interim the management company is earning revenue from the car park and also from street parking. The Governor of the Central Province Tikiri Kobbakaduwa who is from the PA addressing a meeting recently on Kandy Traffic Problems publicly condemned this situation and urged the Kandy community to take legal action to take back the car park from the private company.

The Kandy News investigations have revealed that Mr. Wijesena secured BOI status for his company and its US $ 80 million (Rs 8,800 million) Kandy City Center property through a cabinet decision in October 2005 under the Chandrika Kumaratunga administration. This was a few weeks after he secured the lease on the car park. It appears that the KMC was unaware of this status of the Kandy City Centre until earlier this month. Former Kandy mayor Mr. Kesera Senanayaka told this newspaper that an attempt to make The Kandy City Centre a BOI project when Mr. Anura Bandaranaike was the minister in charge of BOI failed.

Mr. Wijesena planned to formally open The Kandy City Centre in March 2009 with President Rajapakse to do the honours. However, on a request from the president, the date has been advanced to January 29th when the president is also expected to lay the foundation stone for the construction of a three-cinema movie complex, an open air theatre and a cultural complex on top of the existing four storey car park. By making the car park a BOI project the developer will be entitled to secure the usual tax concessions and other benefits that are available to BOI projects.

On December 29th, 2008 Mr. Weeratunga presided over a meeting held at the presidential secretariat to discuss the Kandy City Centre and the Car Park under the new arrangement. BOI Chairman Dhammika Perera and a host of senior officials as well as Mr. Wijesena, his architect Mr. Ashley de Vos and senior managers of Property Finance and Investment Kandy (Pvt) Ltd participated in the meeting. The only officials from Kandy were DIG (Central Range) Pujitha Jayasundera and Senior DIG Gamini Navaratne. Representatives of some state agencies such as the People's Bank that have rented space in the new complex were also present.

The meeting discussed, among other things, a request from Mr. Wijesena to allow the import of, under concessionary duty, 34 new single deck buses, 15 double deck buses and 60 new diesel cars to run a bus cum taxi service from the Kandy City Center and car park. He also requested additional tax concessions to proceed with the new building to come up on top of the car park and wanted exemption from the newly enacted National Development Tax.

The meeting also discussed the need for enhanced security for the Kandy City Centre and the car park with easier access from the Kandy Lake (Hatton National Bank) side. Improved street lighting for the area and removal of old structures on the Kandy Lake side to beautify the area were among other matters discussed.

If and when the new scheme is fully implemented it is likely that street parking in the town will be severely restricted to compel motorists to park in the car park.
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Senior staff reporter Sarath Doolwela contributed to this report.

KMC Car Park Must be Taken Back to Solve the Kandy Traffic Problem - Governor Kobbakaduwa

The KMC car park built with public money is now in the hands of a private businessman. He does not pay the lease rent but earns money from the facility. It must be taken back so that it can be run not for the benefit of one person but for the benefit of the Kandy public, said the Central Province Governor Tikiri Kobbakaduwa addressing a meeting held recently to discuss solutions to Kandy traffic problems. The meeting was organized by the Central Province Chamber of Commerce and Industry. Governor Kobbakaduwa was the chief guest. The President of the Chamber Anuruddha Warnakula presided. The then Chief Minister Sarath Ekanayaka, Mayor L B Aluvihare, Secretary to the Chief Ministry of the Central Provincial Council K Kakulandera, DIG Pujitha Jayasundera, UDA Director Ms Janaki Hettiarachchi, Municipal Commissioner W A R Wimalasiri, other senior officials, members of the Municipal Council, civil society leaders, other stakeholder representatives and academics were among those that attended the meeting.

The main purpose of the meeting was to discuss the “Kandy Traffic Study” Report that was prepared by an inter-disciplinary group of experts that included highway engineers and civil engineers, economists, management specialists and others. The Chairman of the Kandy-based think tank Global Vision Professor S W R de A Samarasinghe presenting the main findings and proposals of the study noted that the study team did not look at Kandy traffic problems as a purely engineering problem as often happens. Sound engineering and road building, as important as they are, alone won't provide sustainable solutions to Kandy traffic problems, he noted. You also have to factor in economics, management, politics, governance and the sociology and psychology of behaviour of Sri Lankan motorists and pedestrians to design a viable set of solutions he said.

The President of the Chamber of Commerce and Industries Central Province Anurudda Warnakula presenting the Kandy Traffic Study Report to the Governor of the Central Province Tikiri Kobbakaduwa in the presence of the Mayor of Kandy L B Aluvihara and the DIG of the Central Province Pujitha Jayasundera.

The report does not recommend the reintroduction of the one-way system between Kandy and Getembe. The major short term recommendation of the report is to begin a rapid transit rail service between Peradeniya Junction and Katugastota using whatever resources readily available. In the long term it can be further improved with the addition of a second railway track and other facilities, the report says. For the long term the report strongly recommends an integrated approach to Kandy traffic planning and development.

Dr Jayalth Edirisinghe presenting some of the detailed data that the researchers had gathered pointed out that heavy traffic that the concentration of schools in the Kandy town and along the main access roads generated was a major factor for the traffic congestion that motorist experienced. The long term solution was to relocate some of the schools to the periphery closer to the homes of the children he said. He also pointed out that the Gannoruwa-Katugastota by-pass road greatly reduced traffic coming to Kandy simply to proceed to a destination beyond the town. If by pass roads are improved congestion can be reduced he noted.

Mayor L B Aluvihare commended the researchers for the producing the first ever detailed and comprehensive study on Kandy traffic. He pointed out that the KMC car park issue is under litigation. He also revealed that unbeknown to the KMC that repays the car park loan with interest to the Asian Development Bank, the government has declared the car park to be a BOI project. He described it as an anti-people act that totally undermined the interests of the Kandy public. He assured the meeting that he would take immediate steps to present the proposals of the report to the Kandy MC Traffic Committee and implement whatever they could.

UDA Director Ms. Janaki Hettiarachchi proposed that the Greeter Kandy Development Committee that the government has recently established should create a Traffic Sub-Committee and implement the proposals of the report.

The Project Director of the Greater Kandy Water Supply Project Engineer Sarath Gamini urged that an Action Plan should be prepared based on the proposals of the report for implementation.

Mr. Ranjith Wijekoon, Program Officer of The Asia Foundation that sponsored the research, proposing the vote of thanks said that the Foundation decided to undertake the study under its Economic Governance Program because the Kandy traffic problem had become a major obstacle to economic progress of the city. The Foundation is much encouraged by the positive response to the Report and hopes that the authorities would implement its proposals, he said.
(See also the Kandy Traffic Supplement that is carried with this issue of The Kandy News).

KMC Overcomes Fiscal Deficit with Astute Budgetary Management

The governing UNP and the main opposition SLFP were unanimous in their praise of the Kandy mayor L B. Aluvihare for his astute management of the 2008 KMC budget under very difficult fiscal circumstances. For the SLFP this was a complete reversal from the position that they took one year ago when they not only opposed the budget but even went to courts over a technical error in the budget.

The KMC Leader of the Opposition Thilina Tennakoon participating in the 2009 KMC budget debate commended the mayor for collecting a large amount of past due taxes and rates to bridge the 2008 budget deficit. He expressed the hope of the opposition that the mayor would perform equally well this year and announced that the SLFP group would vote for the budget. The sole member of the Muslim Congress Mr. Asmin Marikkar also voted for the budget. The two JVP members voted against the budget but failed to give a clear reason for doing so.
The total income for fiscal 2009 is estimated to be Rs 1,045 million. Of this amount Rs 964m will be devoted to recurrent expenditure mainly salaries. Capital expenditure will be Rs 81m.
Following the budget debate The Kandy News asked the Mayor for details of the additional revenue that the KMC has collected in fiscal 2008. He told our correspondent that the payment due from the leaseholder of the KMC car park together with past due did not materialize last year as originally anticipated. We are still in litigation with the leaseholder, he said. Rates and other taxes from private taxpayers were also in arrears. We estimated that the total lease and tax income shortfall was around Rs 103m. In addition the central government unexpectedly cut its salary and wages grant by Rs 17m for fiscal 2007/08. We had to take emergency steps to avert a fiscal crisis and with the cooperation of the members of all parties, plus officials and, I should say, the taxpayers of Kandy we succeeded. We created a new tax collection plan and appointed a special official task for the purpose. The following were the amounts that the KMC collected by December 2008 in overdue taxes and rates:

In addition we imposed a fee on the lorries that entered the Menikkumbura wholesale market and collected Rs 1.1m.

Deputy Mayor Suminda Wickremasinghe speaking to The Kandy News attributed the success in revenue raising last year to the new good governance norms that have emerged in the KMC administration. He credited the Public-Private Dialogue that has been established with the assistance of The Asia Foundation for this new spirit of cooperation not only between the governing party and the opposition but also between the KMC and the taxpayers. The regular dialogue that takes place has resulted in mutual understanding. We in the Council understand the problems that the taxpayers, especially the business community, face and they in turn understand the challenges that we face in delivering quality services to the community. I want to send a message for the New Year through The Kandy News to the Kandy community that we must resolve to continue this spirit of cooperation and further strengthen the positive trend that started in 2008, the Deputy Mayor said.