The Hon. Sunil Handunnetti - Minister of Industry and Entrepreneurship Development

¶ 01 Thank you, Hon. Deputy Chair.

¶ 02 This Fiscal Strategy Statement is another step in implementing our economic approach. We have demonstrated our ideals practically—by limiting expenditure, reducing perks, abolishing MPs’ and Ministers’ pensions—setting an example aligned with a sustainable vision of “a prosperous country – a better life.” This Statement sets how we will operationalize the strategy for 2026: how we will manage risks. The FSS and the Fiscal Risk Statement are key. The Opposition should welcome this, because we are self-binding our conduct. The Government, the Finance Minister, the Cabinet—we cannot arbitrarily overspend. Some Members asked for “itemized” steps—as if inspecting a plate of rice for vitamins, protein, carbs and fat! You cannot pick those out visually; but if you understand, you know they are there. The FSS presents vision and trajectory—how we will frame the 2026 Budget. If we proceed blindly as in 2020–2022, we will repeat disaster. Now the path ahead is visible.

¶ 03 We are identifying the risks of 2026 and 2027—especially in the SOE sector, macro shocks, legal exposures, and local government entities—and how to cap their spending. The Opposition should be happy: by reading this you know where we are going. Hon. Gayantha Karunathilake said the President needs a good steering and engine; Hon. Harshana Suriyapperuma, now Finance Secretary, said the engine must match the steering. Beyond that, we need the whole vehicle. Now the system—the vehicle—is functioning, integrated with local authorities. We are stating our goals and limits. We know our burdens and capacities. This is a formal document under Sections 11(2) and 11(3) of the Public Financial Management Act. We transparently state our strengths and constraints to the world; this is not a New York or Washington draft. We even told the IMF Managing Director, in the President’s presence, that we intend to exit the programme by 2028. We will not linger under externally imposed limits. That is recorded here.

¶ 04 Some say “there are no numbers.” Read the whole report. In the Sinhala version, Annex 11 on page 33 lists “Specific policy measures taken to support fiscal sustainability,” including: a new fiscal rules framework; major tax policy reforms—broadening the base and indexation—with measures already in force since 1 January 2024, and those from 11 January 2025, and PIT reforms from 1 April 2025; modernization of tax administration and institutions, including establishing a Criminal Investigation Unit in Inland Revenue; a simplified PIT return for employment and interest income for 2023/24; expanding risk management; abolishing SVAT with a new refund unit; internal affairs units at IRD and Customs; Customs strategic plan 2024–2028; and Excise administration upgrades.

¶ 05 On page 24, key focus areas are listed. Hon. Chair, I request that pages 24, 32 and 33 be incorporated in Hansard, as some only skim covers.

¶ 06 This Statement allows everyone—Parliament, academia, civil society—to evaluate Government performance. We will not push 2025 burdens into 2026; because we will be governing in 2026 and 2027 too. Our goal is to resolve 2025 risks within 2025. Our revenue targets are outperforming; that reduces 2026 burdens. Tourism arrivals are higher, easing next year’s load.

¶ 07 Some say tourism burdens the people. No—tourism requires infrastructure, homestays, jobs; it unlocks value. Batticaloa, with islands and lagoons, has vast potential; its airport should be utilized. The North and East hold great tourism and industrial potential. Formerly closed factories are reviving—National Paper now runs 24/7—creating jobs. But without rule of law and a sound economy, potential is wasted.

¶ 08 My Davos remarks were distorted online. I said: our brightest youth, educated by free education, are leaving—this is not only our crisis but an Asian phenomenon. Drugs flow from abroad; we welcome tourism, but not narcotics. We must grow with such guardrails; we recognize that.

¶ 09 Hon. Mano Ganesan, the past problem was reckless spending by prior coalition governments, using tenders, contracts and positions to “maintain” allies—even local councillors with roadwork allocations. That cannot continue. By tabling the Fiscal Risk Statement and FSS, we self-impose discipline: better data and modelling, improved institutional links, continuously updated assumptions tied to reality. Only by delivering on-ground results will we succeed.

¶ 10 On corruption: can anyone today point to MPs or councillors and call them thieves? We have zero tolerance. On the report about releasing 300 containers, Hon. Mujibur Rahuman has presented it; as a Government we have not yet officially tabled it, but the committee has given it to the President and a process is underway. We will act on its recommendations and take all lawful steps. We have no friendships to protect. In the past, Presidential Commissions reporting on 33 Ministers’ asset malpractices were shelved by the then Government. Not this time. The committee appointed on May 30 completed its report by June 16—unprecedented. If what Hon. Rahuman says is accurate, see whether any official is being shielded. We are committed to implement recommendations and punish the guilty.

¶ 11 This is why we present the FSS and Fiscal Risk Statement—for transparency. We assure this House and the people: we will act as declared—nothing beyond.

¶ 12 Thank you.