Nearly 120 State Owned Enterprises (SOEs) including the debt ridden SriLankan Airlines will be exempt from government audit under the proposed 20th Amendment to the Constitution.
Among other state owned business entities to be excluded are Lanka Electricity Company (LECO), Sri Lanka Insurance, Lanka Hospitals PLC, Litro Gas Lanka Ltd, Lanka Sathosa, Lanka Coal Company Ltd and multiple plantations.
The draft proposal drew strong protest from the Sri Lanka Audit Service Association (SLASA) and opposition parliamentarians.
The 20th Amendment was taken up for discussion at today's (16) cabinet of ministers meeting, government sources said.
On Tuesday (15), a nine-member committee appointed by Prime Minister Mahinda Rajapaksa to study the 20th Amendment handed over its report to the Premier.
Meanwhile, former State Minister of Finance Eran Wickremaratne stressed that the power to audit government finances, funds, and public institutions should remain independent of the executive.
“However, the National Audit Service Commission has been revoked by the proposed 20th Amendment. The independence of the auditor has been stripped completely," he said.
“Under the 20th Amendment, all the power to appoint persons to all the Commissions, including the Auditor General, will be centralised with the President,” Wickramaratne pointed out adding that it is not the character of the person who is in the seat of power that will ensure democracy, justice, and equality, but a robust system with check and balances.
Offices of the President and the Prime Minister exempted!
Opposition MP J.C. Alawathuwala has hit out at the government for exempting the President’s and the Prime Minister’s offices from being audited under the 20th Amendment.
“We wish to ask the President and the Prime Minister what is the objective of doing that? ” the SJB parliamentarian queried.
He pointed out that the Prime Minister had recently said that he was unaware of the provision until the amendment was sent to be gazetted.
He said that the inability of the government to reveal who drafted the 20th amendment is an indication of the type of new constitution that is to be introduced in the future
When State owned companies, in which the government is a majority shareholder, are audited by private entities, the reports are not required to be submitted to Parliament, the union said. This would undermine parliamentary financial oversight.
The 20th Amendment also seeks to abolish the National Audit Service Commission which, the union says, was established to comply with international and global requirements related to independence in public finance and governance. And it does not propose an alternative.
The qualifications required of an Auditor General which were more defined under Article 153(1) of the Constitution have been removed and the method of appointment changed to allow direct nomination, by the President, without the Constitutional Council’s involvement.