The Hon. Rauff Hakeem, Attorney-at-Law

¶ 01 Hon. Presiding Member, to preface my arguments on the Second Reading of the Appropriation Bill, I quote from an ODI publication, “Sri Lanka: from debt default to transformative growth,” with contributions from Dr. Indrajit Coomaraswamy, Dr. Nandalal Weerasinghe, and Prof. Shanta Devarajan:

¶ 02 “These improvements in the economy can be traced to a combination of decisive stabilisation measures, the IMF programme and interim Indian aid...”

¶ 03 Further:

¶ 04 “The country’s 17th IMF programme has brought in the toughest policy conditionalities and austerity measures so far in Sri Lanka. It focuses on revenue-based fiscal consolidation and seeks to significantly raise tax revenue and increase utility prices; control inflation by raising interest rates, eliminating monetary financing and ensuring an independent central bank; rebuild foreign exchange reserves through a flexible exchange rate and other measures; safeguard financial stability by ensuring adequately capitalised banks and a new banking act; and reduce corruption risks through better fiscal transparency and public financial management.”

¶ 05 This was in the 2023 IMF Report. All this took place before this Government took over; the most difficult part was completed by the previous administration. The book also states:

¶ 06 “...Sri Lanka sought bridging finance and aid from India to finance essential imports of food, fuel and medicines. In the first six months of 2022, Indian aid worth $3.8 billion flowed to Sri Lanka, through credit lines and deferred loans and grants. This meant this was India’s largest bilateral aid programme to any country in recent times.”

¶ 07 If not for that, we would have been in dire straits. These happened before this Government took over. Now, the Government obediently follows IMF dictates.

¶ 08 Earlier, I spoke about cost-reflective pricing. The CEB raised tariffs to match costs. In 2022, as Hon. Kabir Hashim said, their loss was Rs. 298 billion. In 2024, a profit of Rs. 1,044 million. From a Rs. 298 billion loss to Rs. 1 billion profit. With that, what did the President promise? He said during the election, “We will reduce electricity rates by 30%.” Did it happen? No, because the IMF will not allow it. Worse, IMF insisted legacy debt be added; accumulated debt was loaded on consumers. So promises were not kept.

¶ 09 On the CEB, another serious issue now in the public domain: a grand theft of the nation’s power—arguably the most brazen raid on the public purse. Not a mere accounting anomaly, but an orchestrated plunder of the CEB executed over decades by a cabal of 15 led by U. D. Jayawardena, weaponizing insider access and fiduciary trust to siphon billions. This is being discussed here and publicly.

¶ 10 The anatomy: in 1980, the CEB founded Lanka Transformers Limited (LTL) with 70% CEB ownership. Over time, foreign shareholders wanted to exit. Instead of the CEB reclaiming, the Board chaired by Nalinda Illangakoon declined to buy citing cashflow, though it was only Rs. 500 million. Then, wearing two hats as Chairman of CEB and LTL, he facilitated transfer of those shares to a private trust—LTG ESOT—controlled by insiders. That trust, now “Peradev (Pvt.) Ltd.”, is 82% owned by that gang of 15 engineers who now beneficially own almost 30% of LTL Holdings without investing a rupee. The value of this stake is estimated between Rs. 34.4 billion and Rs. 64.5 billion per independent valuations by NDB Investment Bank and CT CLSA Capital. I table documents.

¶ 11 Since 2018, this gang has pocketed almost Rs. 5 billion in dividends—leveraging sovereign strength of the CEB without consent, transparency or accountability. They evaded Auditor-General audits by filing case after case. Shamefully, the Cabinet Member who filed action later withdrew it in the Supreme Court. They call it a management buyout; it is a betrayal.

¶ 12 We must demand a full forensic audit of LTL and share transfers; immediate referral to CIABOC; and legislative reforms to prevent future SOE/employee-trust abuse. This is about restoring public trust and signalling that no one can loot the State and go unpunished.

¶ 13 Previously, we challenged the e-visa scandal of the last regime. We went to the Supreme Court; today the Controller General of Immigration and Emigration is jailed for contempt for not obeying court orders; the case is ongoing. A Government Member claimed it as their achievement; but it was the Opposition that went to court and got the nontransparent tender cancelled. Almost one-third of the IMF bailout would have been earned by them if allowed to stand.

¶ 14 On this Budget: a lady Member spoke about new Community Development Councils at every Grama Niladhari Division to identify needs, and planning regional development accordingly. How are these councils created? In some areas, Government Members are already forming them, appointing their defeated local authority candidates as chairmen—in Akkaraipattu and Addalaichenai. Where is transparency? If State funds are spent, there must be a legal mechanism and independent selection. Otherwise, defeated candidates will control development, sidelining elected local authorities.

¶ 15 For 2026, Rs. 150 million is allocated for an indoor Stadium in Kalmunai—the same amount as last year—yet not a cent was spent; only 30% physical progress overall and under 20% financial progress. We thank the President for allocating Rs. 300 million to complete the half-finished Nintavur auditorium—we appreciate it—but ensure implementation is supervised so funds are meaningful.

¶ 16 Also ensure transparency in rural development implementation. This morning, the Minister of Health and Mass Media asked all Opposition Members to participate and assist district development; meanwhile local authorities are being kept out.

¶ 17 There is also an Adjournment Motion by Hon. Kabir Hashim today on this same issue and the use of Governors to stultify the actions of...