The resolution for the implementation of the Domestic Debt Optimisation (DDO) to restore Sovereign Debt Sustainability was passed by an overwhelming majority of 60 votes in Parliament yesterday. The Resolution, with amendments incorporated, received 122 votes in favour and 62 against.
The Resolution was taken up for debate from 9.30 a.m. to 7.30 p.m. yesterday and a vote was held following the debate.
On a request of Prime Minister Dinesh Gunawardena, Parliament convened yesterday at 9.30 a.m. as per the Gazette notification Extraordinary issued by Speaker Mahinda Yapa Abeywardana in accordance with Standing Order No. 16 of Parliament.
The Cabinet of Ministers on June 28 unanimously approved the proposed DDO strategy to restore Sovereign Debt Sustainability.
Opening the debate for the Government side, Prime Minister Dinesh Gunawardena assured the safety of the Employees’ Provident Fund (EPF), Employees’ Trust Fund (ETF) and the country’s banking sector.
The Prime Minister said that People’s Bank was the biggest bank that entered the banking system during the great people’s revolution in Sri Lanka and he wished the People’s Bank on its anniversary which fell yesterday. The Prime Minister said that compared to Sri Lanka’s population of 22 million, 57 million bank accounts are maintained.
Premier Gunawardena said that the Employees’ Provident Fund (EPF) set up in 1958 under the Central Bank of Sri Lanka (CBSL) by the Government that came to power in 1956 is the largest fund in Asia with a value of Rs. 3.5 trillion. He said both EPF and ETF will be secured as the institutions which have the largest financial deposits.
He said some MPs had often forgotten the most severe crisis that our country has gone through in the past 10, 11 months.
“First, we need to get out of this situation. In order to build trust for that, we worked with the International Monetary Fund (IMF), World Bank and the countries and private creditors that support us. The President as the Minister of Finance has reported it to Parliament and our State Ministers have reported it.”
The Prime Minister said, “today we are gathered once again to discuss and arrive at a consensus on an important matter which is of extreme national importance. Owing to the premature comments, speculation and assumptions by the members of the Opposition, serious confusion had arisen among the members of the public.”
“As a Government, we take the full responsibility for every step proposed by us and tabled in this Parliament on this matter and clearly stand by the assurances already given by the relevant stakeholders, the CBSL, Secretary to the Treasury and the public statement by President Ranil Wickremesinghe. The situation in our country has recovered from the anarchic situation and the country has been brought to stability. If the economic living conditions are a burden for the people, it has been brought to a somewhat comfortable level. Economic activity has started in the manufacturing sectors.”
The Prime Minister said, “We will not allow false and misleading statements to victimise the working class in our country. The dark economic situation that existed a year ago has changed. In addition, the people were waiting and standing in queues to buy various things. That situation has changed today. I think bus fares and train fares have not increased since July 1.
The prices of electricity units have been revised to some extent by the Minister. Each of these will bring down the cost of living and create a favourable situation.”
“I believe that the Opposition will support and fulfill its responsibility in the process of going through a national crisis. It has also failed the efforts made to instill doubt in our business community about the EPF and ETF, which the working class have invested in. I would like to appeal once again to support our efforts to make this initiative a success which goes parallel with the IMF, World Bank as well as the local banking system that supports us. Regardless of political ideologies, we are asked to become partners in the process of moving the country forward with a stronger financial and economic status by September to overcome this crisis, “the Premier said.
Legislation that will ensure that the DDO does not affect the EPF and that the Fund receives a nine percent minimum interest rate will be passed in Parliament, said Labour and Employment Minister Manusha Nanayakkara. Accordingly, steps will be taken to get Cabinet approval for an amendment prepared for this, which shall be incorporated into the EPF Act. Minister Nanayakkara said the proposed law would soon be presented to Parliament.