Budget 2023 brought no relief to the common man. It isprimarily an attempt to save the country from the economic abyss that it had been in for several years. The people also saw it as a measure to save politicians themselves. The allocation of 539 billion rupees for defence, compared with 489 billion rupees last year, and more than what was allocated for education, health and public transport, speak volumes about where the government’s priorities are.
The economic catastrophe was mainly due to the shortsighted policies of the Rajapaksa regime which has been holding onto the reins of power since 2005 except for a short stint from 2015 to 2019.
Over the years, people have been duped into believing that the Rajapaksas are saviours of national assets, but what actually happened was that a Rajapaksa coterie robbed the country while concealing their shenanigans elsewhere in the world.
The present administration under Ranil Wickremesinghe is also unable to fulfil the obligation of delivering to the people given the composition of parliament.
However, now again there is an ominous move to invigorate, promote, and propagate the Rajapaksa brand which has temporarily ground to a halt, mainly because of the reluctance of provincial organisers of the SLPP. They believe Mahinda Rajapaksa’s shelf life has long passed, and they are unable to rebrand him under a new name.
During the Rajapaksa retro, a group of bureaucrats even tampered with figures and statistics to project a false illusion to the country at large.
In short, the Rajapaksa regime was a melodrama that gloated with eagerness to retain power and dwelled on the miseries that the country might face.
The Rajapaksa drama unfolded in the annals of the contemporary political history of Sri Lanka, deceiving people right from the beginning and soliciting mass backing for their self-serving projects through deception.
This was possible since the voters did not possess the required political acumen or the will to decide what was best for the country in the long run. The literacy rate doesn’t come into much consideration when compared with political knowledge, which was at a very low ebb.
Sri Lanka is now lagging behind in many areas after showing the entire Asian region the value of democratic governance. SriLanka is the oldest country in Asia to be granted universal suffrage.
Economically, the country has swooped down to the bottom, and people may face many obstacles in the days to come with price hikes while being unable to keep the home fires burning.
Though the president says his objective is to keep the country from starving with the affordability of three square meals a day, many lower middle-class people have been pushed below the poverty line due to the prevailing situation. Statistics from the World Food Programme and other international agencies have shown that millions of people are in need of food aid, while food security in Sri Lanka has posed the biggest challenge to the government.
President Ranil Wickremesinghe, delivering the budget speech on Monday, suggested the effort of the government is to go beyond International Monetary Fund proposals and salvage the country from a gaping economic abyss.
At the beginning of the budget speech, the President said that ‘aglimmer of hope for emerging from the economic abyss is currently visible as a result of the strenuous and difficult actions we have adopted during the past few months. After the era of waiting in lines for days and protesting in various occupied places, our sufferings have been eased to some extent, and we have reached an era where our peace of mind is much more settled’.
On the other hand, the opposition benches scorned this sentiment, claiming that the people were reeling under the pressure of rising prices and slipping into abject poverty from the ridge of absolute hardship.
However, the President said that popular decisions may not take the country’s economy forward; in short, he insists that as a country, there should be opportunities for the people to develop an economy that could put the country on a sound footing.
Excerpts from the President’s Budget speech:
Is the long-term development of a country based on popular decisions? Or the right decisions? In many cases, popular decisions were taken instead of correct decisions in our country. Even today many people try to make popular decisions.
What was the result of this popular ruling tradition? To build a relief economy and a relief mentality across the country. People are used to getting concessions. Governments do not work to create opportunities for people to develop. Only to provide relief.
If we forget that we are facing a huge economic crisis, we won’t have a way forward. It is by realising the current situation, we need to prepare the way forward. Therefore, in the midst of this crisis, it is important to pay special attention to how our welfare programmes could be implemented more effectively. Parallel to this, entrepreneurs in the private sector should be promoted. Private entrepreneurs in our country continued to grow from the mid-19th century to the mid-1950s. But with the nationalisationof their businesses, private entrepreneurship in Sri Lanka almost completely collapsed. As a result of the open economy introduced in 1977, there were again private entrepreneurs, but they were not adequately provided with the necessary facilities.
Many people in the country did not look at entrepreneurs with a good attitude.
Entrepreneurs who contribute to the country’s economy were considered villains. In most of the tele dramas produced in Sri Lanka, the village shopkeeper (“Mudalali“) was portrayed as an evil character. From the small entrepreneur in the village to the large-scale entrepreneurs, everyone was treated as exploiters.
We must change this situation. Private entrepreneurs should be encouraged.
I would like to define the new economy that we are going to build as a social market economy, or an “open economic system of social protection”.
In this new economy, we focus on three main things.
1. An export–oriented competitive economy.
2. An environmentally friendly green and blue economy.
3. A digital economy
Creating such a new economic foundation is a challenging task. Such a new economy cannot be created merely by making changes in the tax system. New sources of revenue should be found. New areas should be identified. Massive economic reforms and restructuring should be carried out.
We hope to base two unique points here.
The first – economic reforms and reorganszation, the second – economic modernisation.
We must achieve rapid economic growth. The entire potential of the country should be tapped. Re-examination of the country’s resource base as well as the re–organisation of them are also important here. Education, health, agriculture and marine resources, industry, trade and investment, defence, foreign relations, etc., must all be modernized. We should carry out this socio-economic transformation taking into account the global phenomena. In particular, a special attention should be paid to climate change.
• Increasing international trade as a percentage of GDP by more than 100 percent
• Annual growth of US$ 3 billion from new exports from 2023 to 2032
• Foreign direct investment of more than US$ 3 billion in the next 10 years
• Creating an internationally competitive workforce with high skills in the next ten years
In order to achieve these goals, we need to create a competitive and high performance modem economy. A modem, export-oriented, competitive economy led by the private sector. A private sector-led, export-oriented, competitive modem economy. We are starting our journey for that in 2023 with this budget.
The president may have presented the budget with good intentions, but there are elements in the government benches who are trying to derail it, and he feels that he is alone in parliament to further his mission. If he has the public’s sympathy for what he does, then it wouldn’t matter to him if the government benches were trying to create havoc during the committee stage of the budget.
On the budget proposals, SJB’s Harsha de Silva was quite critical of the government for failing to allocate adequate funds for social security programmes.
Dr. Harsha De Silva said that the government has allocated only 19 billion rupees to give five thousand rupees every four months to the people who have become destitute and ended up on the streets due to the callous disregard of the rulers in the country.
He told parliament that although the number of poor people in the country has doubled and tripled in the last two years, the funds allocated for social security programmes for the new poor people in this country should be doubled in the budget presented.
Speaking on behalf of the opposition during the budget debate, Dr Harsha de Silva said that 353 billion rupees had been allocated for social security in 2022, but it had been reduced by 85 billion to 268 billion in 2023. However, although this amount was increased to 311 billion in the latest budget presented, it has decreased by 42 billion compared to last year. Although the president spoke with great interest about social security, De Silva who expressed his surprise at the reduction of expenses for it compared to last year said that during the period from January to April, an additional allowance of Rs 300 was received by the Samurdhi recipients. Others in poverty received Rs. 5,000 every four months.
Eran Wickramaratne, a one-time State Minister of Finance, was also critical about the budget lacking practical solutions.
Whether President Wickremesinghe can revive the economy is a pertinent question doing the rounds in business circles while expressing displeasure with certain economic reforms and taxes proposed for the export market. The answer is that the entrepreneurs who enjoyed tax holidays in the past have failed to bring back considerable benefits to the country. Many questions are yet to be answered comprehensively, as the country’s economy is still creeping under the pressure of inflation.
Meanwhile, Nishan De Mel of Veritie Research says that there is no proper action plan to achieve the target and get out of the current crisis. He claims that he has not seen a government action plan to achieve its desired goal in the last fifteen years.
Aside from that, there are rumblings within the government over moves to defeat the budget by a group headed by S. B. Dissanayaka, who is demanding ministerial positions. Many however believe, that at a time when the president is working hard to revive the economy, no action should be taken that would jeopardise or upset the president’s apple cart.
President Wickremesinghe’s invitation to the Tamil parties to sort out their issues was also met with stiff resistance when they said that every government in power has repeatedly done it and they are now fed up with participating in such discussions. What they say is that the government should take principled decisions and then come up with a pragmatic solution. Tamil parties say this invitation was a ploy to draw the attention of the IMF to expedite the bailout package.
The Ranil Wickremesinghe administration has encountered many problems relating to democratic governance and human rights issues, which he must resolve.
The detention of two university student leaders WasanthaMudalige and Ven. Siridhamma Thero has caused ripples among the law-abiding people in the country as to whether there was any blatant violation of rules and regulations on the part of the youth activists. Their detention had been challenged in the Supreme Court, and both Ven. Siridhamma Thero and Wasntha had been committed to judicial custody until the Attorney General made his recommendations. The Supreme Court has also granted leave to proceed with the case, which in some ways is a relief to see the two victims released from the custody of the Terrorism Investigation Department. Others say it could lead to a long period of incarceration like other PTA detainees.
Meanwhile, the Sri Lanka police already burgeoned by an abysmal human rights record which has been facing increasing censure at both the local and international levels, was in the spotlight again last week. During one incident last Saturday, a group of police officers obstructed a peaceful walk by women, identifying themselves as ‘mothers of the struggle,’ and arrested two of them. The mothers’ demand was that the Sri Lankan state release Mudalige, who is also the convenor of the Inter University Students Federation and Siridhamma Thero, who is the convenor of the Inter-University Bhikku Federation. The two university student leaders have been illegally detained for more than 90 days under the Prevention of Terrorism Act. The reasons for their arrest and detention without charge for more than three months has resulted in continuous protests for their release as well as nearly 130 others who are being held under the PTA. Hot on the heels of the intrusion into the mothers walk, visuals of the Chief Inspector of the Panadura South Police station headquarters Chamindra Pinto purportedly squeezing the neck of a woman police officer for not controlling another group of protestors that same day, went viral on media platforms. Continuous behaviour such as this where the police are thumbing their nose at the law and constitutional guarantees is setting unsavoury precedents and heightening an erosion of the peoples’ confidence in police neutrality. The fundamental question here is who is leading the police to conduct themselves in this way, even to violate the law, which they themselves have a responsibility to protect. This weekend’s headlines in the Anidda newspaper, a mainstream Sinhala media which has award winning journalists in its editorial, is how SSP GayanthaMarapone had stood up to the Minister for Law and Order Tiran Alles. At a meeting where the Minister and senior police officers were present, Marapone had been reprimanded for not arresting and preventing Hirunika Premachandra and others from marching towards the UN compound in keeping with orders given by Western province DIG Deshabandu Tennekoon. The DIG had then by-passed IGP Chandana Wickremeratne’sauthority and asked the OIC of the Cinnamon Gardens police station to arrest the protestors. At the meeting Marapone had spoken up and said he is not prepared to carry out illegal orders to arrest protestors. A burning question, almost to the point of frustration for the citizenry now is who do they turn to when the state and its agencies that have been tasked with the responsibility to enforce the law and protect the people, resort to illegal acts because of subservience to political pressure. A police force which is known for its efficiency at arresting protestors for simply exercising their fundamental rights have so far not made clear what disciplinary measures will be taken against Pinto, even though it is coming up to one week on Saturday. The government must not give protestors a reason to protest. It must stop running scared of them perpetually.
