The Hon. (Dr.) Anil Jayantha - Minister of Labour and Deputy Minister of Finance and Planning

¶ 01 Hon. Presiding Member, thank you for the opportunity. At the end of today’s debate on the Heads of the Ministry of Public Administration, Provincial Councils and Local Government, and the Ministry of Labour, I will present a few points, mainly on the Ministry of Labour: its mandate, actions taken, progress, and what we intend to do going forward.

¶ 02 A key institution under the Ministry of Labour is the Department of Labour. There was an unfavourable public perception about the Ministry, the Department, and the affiliated institutions – that no real work gets done, or that things are sluggish. Especially when workers sought compensation, the processes were not satisfactory. Now we have the opportunity to gradually transform that image positively. I thank our officials who are intervening actively. Through digitalization and technology, instead of people wasting time physically at our institutions, we are preparing to move processes online and forward.

¶ 03 Let me also indicate how much of that old image has been broken. You all know of the large “Mehewara Piyasa” building under the Ministry of Labour. However, among prior activities, rather than making it an efficient public service hub, some actions were driven by the personal agendas of then Ministers. For example, a Cabinet Paper was submitted in August 2024 – one to two months before the elections – proposing, ostensibly to serve workers, to set up on the 31st floor a canteen and, in addition, an a la carte restaurant and a nightclub. They did not get time to implement it. This shows how they operated.

¶ 04 On 14 November, the Appropriation Bill Second Reading was passed. Under six themes – sustainable development, debt sustainability, export promotion, a production economy, poverty alleviation and digitalization – funds were allocated. We showed clearly, as in the previous Budget, how public finance discipline will be maintained, how we will operate within the agreed framework, and particularly how we will manage the Budget deficit within controllable limits. In the 2026 Budget, we aim to reduce the deficit to 5.1 percent of GDP. In the past, actual deficits exceeded estimates, leading to increased borrowing. Under our Government, even during crisis stabilization, we have been sequentially reducing the deficit and the need and scope for borrowing.

¶ 05 [Committee proceedings and resumption noted.]

¶ 06 Continuing, we must move forward from the stability gained this year. To lift the country out of crisis and achieve growth across regions, we must catalyze investment by building investor confidence. Within our fiscal discipline, we have to meet Rs. 1,464 billion for salaries and Rs. 510 billion for pensions. Additionally, interest payments amount to Rs. 2,617 billion. Thus, from every Rs. 100 of revenue, a large share goes to these obligatory expenses, necessitating careful, well-planned management.

¶ 07 From the Labour Ministry’s perspective and considering national potential, human capital development is critical. We have introduced reforms to enhance human capabilities and capacities. In this Budget, health and education – the priorities for developing human capital – account for 30 percent of primary expenditure.

¶ 08 Some allegations were raised during the debate. I will not answer all, but on capital expenditure, the Opposition claimed 2025 would show the lowest capital expenditure ratio. That is incorrect. As of end-October, we have executed 58 percent of revised capital expenditure. Moreover, the lowest capital expenditure ratio in history – 50.28 percent execution of revised capital – was in 2016, under the previous Government. Considering September snapshots since 2019, the highest execution of revised capital expenditure by September is in 2025 at 45.3 percent.

¶ 09 Turning to the Labour Ministry’s allocations: total is Rs. 6,400 million, with Rs. 5,200 million recurrent and Rs. 1,200 million capital. Beyond salaries and operations, funds are set aside for programs to improve the quality of the labour force, engage with international institutions and conventions, and conduct public and worker awareness.

¶ 10 Key institutions under the Ministry include: Department of Labour; Department of Manpower and Employment; National Institute of Labour Studies; National Institute of Occupational Safety and Health; Office of the Commissioner of Workmen’s Compensation; and the Shrama Vasana Fund.

¶ 11 On progress: - Women’s labour force participation is only about 31 percent. To achieve our growth targets, this must rise. We are working with other Ministries on programs to increase women’s participation. - On ILO Convention C190 regarding violence and harassment in the world of work, we are advancing steps to obtain Cabinet approval before year-end for ratification. - Occupational safety and health are crucial. Studies show that accidents, illnesses and fatalities impose a 4 to 5 percent of GDP loss. We are accelerating measures to reduce this. - On ILO C103 (Maternity Protection): when the full cost of maternity benefits is placed solely on employers, it disincentivizes hiring women. We are exploring social protection approaches to share costs, thereby increasing women’s participation. We are also addressing legal issues on night work for women, particularly in tourism and food and beverage, by drafting rules with conditions for safety, meals and accommodation. - Our labour laws are mostly over 50 years old. Previous attempts at reform were incomplete and created issues. We have appointed an experts’ committee under the Secretary with 17 members to modernize and align laws to the new world of work. We will present draft laws early next year after broad consultations with trade unions and employers, aiming for sound industrial peace, productive relations, and mutual trust. - The National Labour Advisory Council had not met since 2023. We reconvened it promptly, increased women’s representation, and have already held six Council meetings and six subcommittee meetings with constructive engagement. - On wage increases, instead of a blanket decree, we pursued extensive tripartite discussions. With the President’s guidance, we adopted a shared-burden approach, with targeted State support for the sector rather than individual firms, to minimize financial stress while supporting industry development. - On eliminating child labour and forced labour: we aim to eradicate child labour from Sri Lanka by 2025, focusing on fisheries and plantation sectors; we have increased inspections and awareness. The minimum fine for child labour has been increased from Rs. 10,000 to Rs. 100,000, and we are engaging ILO and others for technical support. - On the care economy: we are working to reduce barriers so more women can engage productively, and to enhance safety using available funds and legal tools.

¶ 12 I thank all officials of the Ministry of Labour, including the Secretary and teams, for transforming the Ministry from a passive image to an efficient, technology-enabled service allowing people to access services even from home. Thank you.