The Hon. Anura Kumara Dissanayake

¶ 01 The year 2025 has effectively become the payment year for many commitments. I believe a large number of bills are due this December, so the total outlay will further increase. Despite this, the State has been recovering over several years through increased capital investments and ongoing projects. However, this natural disaster has dealt a significant blow to a recovering State.

¶ 02 We have increased public sector salaries. Under the Prime Minister’s leadership, the Cabinet Committee has decided to recruit 76,000 into the public service, including around 12,000 positions for university graduates. These will be secured through competitive examinations offering good careers and prospects. There are also other opportunities for graduates across sectors. About 12,000 jobs will be created for which a degree is the sole qualification.

¶ 03 Everyone who joins will have work to do, avenues for promotion, and a future. We had built that pathway, and it is while we were on a recovery trajectory that this shock struck, with a notable impact.

¶ 04 On revenues, many said we simply raised taxes to hit our targets. I must note that we reduced some taxes that were in place in 2024. Excluding vehicle imports, we did not impose additional taxes for 2025. The previous government had a 2025 revenue target of 15.2 percent of GDP under the IMF program and had planned extra taxes to achieve it: a Digital Services Tax from April, and a Property Tax from April as well. They planned a 30 percent Digital Services Tax. What did we do? We cut it to 15 percent and deferred implementation to next April, so it does not apply for 2025. As for the Property Tax, we will not implement it in 2026 either; we will review it and consider it only by 2027. We have informed the IMF and reached agreement on that.

¶ 05 We have not introduced new taxes; we have removed some existing ones. We reduced the PAYE Tax significantly, though I accept it is still not enough; we hope to reduce it further in the next Budget. We fully removed taxes on milk-based products and yogurt.

¶ 06 Some Members keep shouting that revenues were raised only by taxing more. Apart from vehicle-related taxes, all other tax rates are lower than in 2024. We have also removed some of the taxes imposed in 2024. Our strength came from far better tax administration. For the first time we have exceeded our revenue targets. Sri Lanka Customs revenue has increased by 59 percent compared to last year. Inland Revenue Department revenue has also increased by about 18 percent. The Excise Department’s revenue too has grown.

¶ 07 We did not impose new excise taxes or new domestic taxes. Customs revenue rose also because of vehicles, but even excluding vehicles, Customs collections increased. This means we are painstakingly reconstructing a once-collapsed State. It is in the midst of this reconstruction that this economic shock arrived. What should we do now? In a fragile economy, even small policy errors can cause severe damage. In 2022, government revenue collapsed to 8.8 percent of GDP—the lowest in our history—demonstrating how minor errors can produce disastrous outcomes in a broken economy. By contrast, in a strong economy, small shocks cause small harms; in a fragile recovery, even modest harms have outsized effects. We understand this and have a responsibility to protect our people without taking decisions that would destabilize the economy.

¶ 08 We convened Finance Ministry officials and ministry teams over several days to discuss how to provide relief without derailing our recovery plan. Some proposed halting this Appropriation Bill and bringing a new one. We are not prepared to do that. Our Budget has clear development objectives and is part of a strategy, not a random set of figures. We said at the time of presenting it that it is designed to implement an economic strategy. We will not tear it up. Another former leader suggested an interim budget. We will not do that either. The 2026 Appropriation Bill is part of a policy framework for sustainable growth, and we will proceed with it. However, we are considering reallocating certain components to prioritize disaster response.

¶ 09 From the Highways Ministry allocation—around Rs. 40 billion—we have Rs. 24 billion for the Road Development Authority and Rs. 15 billion for Provincial Councils for small roads, totaling Rs. 39 billion for minor roads. These roads are the ones hit by the disaster. We will direct part of these funds to immediate road rehabilitation.

¶ 10 We will also use funds already allocated for road repairs by the RDA for this rehabilitation. Altogether, around Rs. 40 billion can be directed to restore disaster-affected roads. We have instructed Provincial Councils to use part of their allocations to fix local roads damaged by this event. We are not scrapping the Budget; we are protecting the strategy while prioritizing urgent needs and channeling funds accordingly.

¶ 11 First step: we increased the dry ration allowance. I heard an MP complain about surviving on current amounts. Previously, a family of four received Rs. 3,200 a week; we raised it to Rs. 8,400. For families of five or more, the weekly amount rose from Rs. 3,600 to Rs. 10,500—nearly a threefold increase—because Rs. 3,600 per week is not livable. Those who paid Rs. 3,600 earlier now criticize the increase; nonetheless, we raised it.

¶ 12 Next, we present a supplementary estimate of Rs. 50 billion today. We will not raise the borrowing ceiling or take new loans for it. We have funds and provisions already allocated. Accordingly, we present the Rs. 50 billion supplementary estimate.

¶ 13 We have already informed District Secretaries to request funds for urgent local needs; around Rs. 10.5 billion has already been released to District Secretaries—unprecedented in these economic conditions. We now ask Parliament to approve the Rs. 50 billion supplementary estimate. We have about Rs. 22.2 billion on hand, totaling Rs. 72.2 billion to spend over the next 25 days—sufficient for December.

¶ 14 How will we spend the Rs. 72.2 billion in the next 25 days?

¶ 15 - We have already granted Rs. 25,000 per household to clean and prepare homes for reoccupation after flood damage. Every house inundated will receive the Rs. 25,000. Earlier, only Rs. 10,000 was given as an advance to be later deducted; now, no deduction will be made.

¶ 16 - We know households have lost basic items—gas cylinders, stoves, mattresses. To help restart life, we plan a one-time Rs. 50,000 grant per housing unit, irrespective of ownership (including renters), to purchase essential kitchen and household items. The Rs. 25,000 cleaning grant is being paid today and tomorrow. Cabinet will approve the circular today and issue it tonight so the funds can be disbursed.

¶ 17 - For those displaced by landslides whose homes are uninhabitable and who do not wish to remain in camps, we will provide Rs. 25,000 per month per household for three months—December 2025, January 2026, and February 2026—to rent accommodation. Those who prefer to remain in relief camps will be fully supported there; those who move out can use the rental support. We expect to extend this up to six months if required.

¶ 18 - Additionally, because livelihoods have been disrupted, for December, January, and February we will provide a monthly livelihood grant: Rs. 25,000 for households of two persons; Rs. 50,000 for households with more than two. This applies whether they remain in camps or rent elsewhere. The circular will be issued.

¶ 19 - For agriculture: for flood-affected paddy, maize and similar grains, we will provide Rs. 150,000 per hectare to replant. Current reports indicate damage to around 160,000 hectares. The “Maha” season is underway, with seedlings less than a month old in many fields. We will cover seed paddy (about 100 kg per hectare at roughly Rs. 150 per kg = Rs. 15,000), land preparation, labor, and minor living support to ensure full replanting of the 160,000 hectares. Where replanting is impossible in pockets, we will address those separately, but first we will release the Rs. 150,000 per hectare.

¶ 20 - Vegetables are often overlooked in such disasters; though cultivated on smaller plots, they are essential. We will provide Rs. 200,000 per hectare for vegetable cultivation. Funds will be allocated from today and the circular issued. Our officials must execute quickly: replant paddy and vegetables to revive the economy, with agriculture taking priority, especially in regions with continuous cultivation.

¶ 21 - Livestock farms: while we need a proper registration and enumeration system, we will use the Veterinary Office records for now. Every registered poultry or piggery farm affected will receive a Rs. 200,000 grant to restart operations.

¶ 22 - MSMEs: Yesterday, with the Minister and State Minister of Industry and Entrepreneurship Development, we discussed micro, small and medium enterprises and received a tiered package proposal. We will simplify: every registered MSME affected will receive a Rs. 200,000 grant to restart. The Central Bank will also issue a circular today providing a moratorium for affected enterprises. We are engaging insurers to expedite claim settlements.

¶ 23 - From the 2026 Budget, Rs. 80,000 million has been set aside for concessional loans to youth, MSMEs and women entrepreneurs. We propose prioritizing a substantial portion of that for disaster-affected enterprises to rebuild quickly.

¶ 24 - Fisheries: many boats are not registered, which is a problem. For any registered fishing boat that is fully damaged and unable to go to sea, we will provide a Rs. 400,000 grant per boat through this supplementary estimate.

¶ 25 - Schoolchildren: out of around 1.6 million students, about 300,000 to 350,000 may be affected. To ensure they can start the new school year, every affected child will receive Rs. 15,000 from the Treasury plus Rs. 10,000 from the President’s Fund—total Rs. 25,000—for a bag, books, and supplies. Additionally, for students receiving the Nutrition Allowance who attend schools with fewer than 200 students, the Rs. 6,000 allowance will continue unaffected; some students may receive up to Rs. 31,000 in total. We built reserves precisely so we can respond to crises like this without derailing our recovery.

¶ 26 - Businesses and buildings: damages vary and need assessment. We will provide up to Rs. 5 million per unit as a damage-recovery grant to restart operations and rebuild structures, according to assessed damage.

¶ 27 - Housing: for fully destroyed or uninhabitable houses due to landslides or floods, we will provide Rs. 5 million to build a new house. Previously, typical grants were around Rs. 1.2 to 1.6 million. For this event, we will give Rs. 5 million. If the land is gone, unsafe, or in a high-risk zone, we will not allow rebuilding there. I am personally visiting highly vulnerable districts—Kandy, Matale, Nuwara Eliya, Badulla—to identify State land for safe resettlement. Where State land is available, we will allocate plots; if not, we will provide up to an additional Rs. 5 million to purchase land, on top of the Rs. 5 million for construction.

¶ 28 - Partially damaged houses: historically, small token amounts were given—Rs. 5,000 for a couple of sheets, Rs. 2,000 for clay—for repairs. That was not fair. We will provide up to Rs. 2.5 million per partially damaged house, in four bands: Rs. 1.0m, 1.5m, 2.0m, and 2.5m, depending on the extent of damage, recognizing that even a missing roof panel means the home is not livable.

¶ 29 - For lives lost, while money cannot compensate for the value of life, we will provide Rs. 1 million per deceased person to next of kin.

¶ 30 For these measures, we plan to utilize Rs. 72.2 billion from the 2025 appropriations over the next 25 days, and we expect to require Rs. 500 billion in 2026. We will not seek an increase in the borrowing ceiling to raise the Rs. 500 billion; we believe we can mobilize it. Our debt ceiling presented to Parliament is Rs. 3,800 billion. In the Budget Speech, I proposed cutting that by Rs. 60 billion to Rs. 3,740 billion, but we will not move that amendment now; we will keep the ceiling at Rs. 3,800 billion given current needs.

¶ 31 We thus have two tracks: - Spend Rs. 72.2 billion in the next 25 days. - From January, when the 2026 Appropriation becomes effective, bring a Rs. 500 billion supplementary estimate incorporating many of today’s proposals. The Rs. 72.2 billion measures will be gazetted today.

¶ 32 Regarding the IMF program, some shout that we should withdraw and propose a new agreement. Such international arrangements are based on negotiated principles. We have completed the fifth review and signed the staff-level agreement, which was to go to their Board on December 15. Given changed circumstances, the IMF has proposed, and we agree, to defer the Board date to January or February to allow discussions on scaling up the scheduled US$342 million tranche. To do that, a review and time are needed. We have also requested an immediate bridge of US$200 million from the IMF this month to address urgent foreign currency needs. We have engaged the ADB similarly, particularly to support MSME recovery.

¶ 33 We have determined the supplementary estimate total, but we need a bit more time to finalize the projects and allocations; therefore, we plan to bring the supplementary estimate to Parliament on the 19th. I trust the Opposition will support it. Even if the main budget debate concludes and the House is to reconvene in January, we will convene in December under provisions for an emergency sitting so that the supplementary can be debated and passed. We must not delay; expenditures under the new budget start on January 1.

¶ 34 Infrastructure suffered extensive damage. About 40 bridges were destroyed; we have already rebuilt around 12 and planned 8 more. We aim to complete work on 30 bridges by December 31 to restore connectivity. The RDA has a structured plan for rapid road system rehabilitation. Power supply initially dropped to around 58 percent coverage; we have restored about 87 percent. A 132 kV transmission line in Mahiyanganaya failed, affecting Ampara, Batticaloa and Mahiyanganaya. We are supplying power at reduced capacity at 32 kV for now, but we expect full restoration within one to two weeks.

¶ 35 Telecommunications have been restored to about 94 percent and will be fully restored soon. Water supply and sewerage are also being repaired. Rail lines need restoration planning. We are reopening everything we can as quickly as possible.

¶ 36 Our first priority is to normalize people’s lives; they cannot remain indefinitely in camps or in uncertainty. Second, we must get the economy moving: replant fields, restart MSMEs, reactivate the banking system and credit flows, and get gains flowing into villages.

¶ 37 On governance architecture: we could have proceeded under the Disaster Management Act, but we chose to proceed under the Public Security Ordinance to establish a strong, centralized response. The Cabinet has decided to set up a Presidential Task Force for Rebuilding the Country. Under it, a committee will be established to mobilize funds. Some accuse us of giving spending power to “racketeers.” That is false. The account is in the name of the Secretary to the Treasury; funds go to the Consolidated Fund, and only Parliament can authorize expenditures. We will also establish a statutory fund properly by Act of Parliament under the new Public Financial Management law; ad hoc funds are not permitted.

¶ 38 The fund mobilization committee includes representatives of the Foreign Ministry to coordinate with development partners (ADB, IMF, UNDP), the Finance State Minister and Secretary to coordinate development finance, the Presidential Secretariat to coordinate with overseas Sri Lankans, and the Ceylon Chamber of Commerce to coordinate business-to-business assistance through foreign chambers. We will also engage major shipping lines’ agents and other business associations to raise contributions.

¶ 39 Some who cry “racketeers” were themselves responsible for questionable decisions in the past. For instance, the SriLankan Airlines-Airbus cancellation cost us USD 118 million in penalties without any aircraft; the Minister responsible at the time now shouts about racketeers. Today, funds are under the Consolidated Fund and subject to Parliament—there is no basis for sowing distrust. People and religious leaders now explicitly ask donors to channel support through the Government because they trust the State’s effort.

¶ 40 We will set up seven units under the Presidential Task Force: fundraising; recovery planning; construction (with RDA and Irrigation Department leading); communications to convey accurate information domestically and internationally; housing reconstruction; and others as needed. We will also bring a Special Provisions Bill swiftly, enabling a 2–3 year “Rebuilding Sri Lanka” program with stable policy to reduce disaster risk and rebuild.

¶ 41 We need stronger preparedness: our air fleet has been neglected. Many of our helicopters have been grounded for about seven years, which degrades their life. We have already concluded procurement to overhaul five helicopters (four Mi-17s and one Bell 212). A further seven Mi-17s are lined up for overhaul, with procurement to commence within one to two months, increasing our helicopter fleet by 12 upon completion. Four MiG fighter aircraft are being refurbished in Israel and are due this December. We are also pursuing advanced transport aircraft through state-to-state channels—such as a C-130 from the United States and contributions from Australia—not for war, but to respond to disasters. These decisions were taken earlier this year, before this disaster.

¶ 42 Local authorities lack machinery—backhoes, motor graders, etc. Even before this disaster and this Budget, we allocated Rs. 7.7 billion to procure about 700 units of equipment for local authorities; procurement is complete and awards pending. By February–March, these should be delivered to help stabilize the country after the disaster.

¶ 43 We must also prevent such disasters: landslides and floods are exacerbated by construction in prohibited zones—mountain tops, riverbanks, reservoir embankments. We will introduce strict laws and enforce them; no one will be allowed to construct in unsafe areas again. We have sought ADB’s assistance to assess the true condition of the Central Highlands. Preliminary maps suggest areas above 5,000 feet may require conversion to permanent forestry; the Government will acquire lands and properties through compensation where necessary.

¶ 44 The World Bank will provide a preliminary consolidated damage estimate by December 15; a full assessment will take three months. The scale of this disaster is such that the nation alone cannot easily absorb the loss; hence we need a stable, multi-year plan.

¶ 45 Finally, I propose this: let us not do politics over corpses or with cruel expectations. Do not seek to topple the Government by wrecking the economy or destroying people’s lives. Seek power at an election. We manage finances under Parliamentary oversight and the Constitution. Those who broke Standing Orders and were found in contempt by a five-judge Supreme Court Bench now try to lecture us on the Constitution.

¶ 46 I invite all Members: rather than stoking division, take ten meal parcels to displaced families; do not politicize this tragedy. I propose that, for three years, we act as a National Council—Government and Opposition together—on a common framework to rebuild and to prevent future disasters, so that enforcement actions like evicting illegal constructions are carried out with national consensus rather than politicization.

¶ 47 I also invite industrialists, businesspeople, professionals, and overseas Sri Lankans to join us. Some who deride businesspeople did not imagine that the business community would voluntarily support a government acting in good faith. Scholars, professionals and senior experts—including individuals like Hans Wijayasuriya, Dumindra Ratnayaka, and others—are contributing their time and knowledge voluntarily. We welcome all who wish to help.

¶ 48 This is a painful disaster. Let us choose a new path together and build a better State for our people. Thank you, Hon. Chairman.