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Lycamobile faces winding-up petition over £51m VAT dispute amid financial struggles and scrutiny

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The Guardian: Lycamobile, a telecoms company that has given more than £2m to the Conservative party, has been issued with a winding-up petition by HM Revenue and Customs, amid a long-running VAT dispute.

The company, founded by businessman Allirajah Subaskaran in 2006, sells pay-as-you-go sim cards that are popular with low-paid workers wanting to make cheap phone calls to family overseas, as well as in the UK.

While the company generated revenues of more than £145m in 2022, it is now loss-making. Its accounts have repeatedly been filed late and have at times confounded its own auditors.

Successive accounting firms have raised concerns about the opacity of Lycamobile’s books, while the company has also been locked in an eight-year tussle with HMRC over its treatment of VAT on phone “bundles” sold to customers over seven years.

The amount in dispute is £51m, according to a tax tribunal that ruled in favour of HMRC last month. In accounts filed earlier this year, Lycamobile estimated the potential cost to the company at £99m.

A winding-up petition is a formal legal process that creditors can use against a company that owes them money and is unable to pay its debts. HMRC regularly issues such petitions, which can result in assets being forcibly sold, against companies that have not paid their tax bill.

HMRC issued the winding-up petition against Lycamobile UK Ltd on Monday, according to a court filing seen by the Guardian and first reported by City AM. Identical petitions were served against sister companies Lycatel Services Ltd and, a week earlier, against Lycamoney Financial Services Ltd. All are ultimately owned by Subaskaran, a British-Sri Lankan entrepreneur who is Lycamobile’s founder and chair.

Lycamobile was one of the Tory party’s most generous donors between 2011 and 2016, giving more than £2.1m. It also supported Boris Johnson’s successful attempt to become London mayor.

It came under scrutiny in 2015 when an investigation by BuzzFeed revealed that Lycamobile employees were depositing rucksacks full of cash, some containing up to £250,000, at the Post Office.

There is no suggestion of any connection to the VAT dispute and Lycamobile said at the time that its cash deposits were part of “day-to-day” banking sanctioned by the Post Office.

Lycamobile has repeatedly filed its accounts late, putting it at risk of being struck off the corporate register. In 2016, the auditor KPMG said it was unable to account for £134m of assets, citing an arcane corporate structure including offshore entities.

The company’s latest auditor, PKF Littlejohn, said in June that it could not sign off Lycamobile’s accounts because it had “not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion”.

Those results, for the year to the end of December 2022, showed a £24m loss, compared with an £8m profit the previous year.

In the subsequent financial year, for which accounts are not yet available, the company suffered a malware attack that reportedly prevented customers making calls or topping up their accounts.

The Guardian has approached Lycamobile for comment.

HM Revenue and Customs said it could not comment due to rules regarding taxpayer confidentiality.

“Michael” Breaks Box Office Records, Wins Audience Love – Truly, Who Can Challenge the King of Pop?

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LISTEN TO STORY;

WATCH STORY;

By : Puli

April 28, LNW (Colombo): The legendary King of Pop, Michael Jackson, has once again come alive before the world. But this time, not on a stage – on the big screen. His new musical biographical film is capturing hearts worldwide and rewriting box office history.



From its very first weekend, the film generated massive revenue, marking the biggest opening ever for a biographical movie. Praise from both critics and fans has played a major role in its success.

Celebrated globally as the “King of Pop,” Jackson’s timeless songs, iconic dance moves, and extraordinary life are brought to life in cinematic form. Legendary tracks like Thriller, Billie Jean, and Beat It are reintroduced in fresh, captivating ways, delivering a powerful musical experience for audiences.


Jackson’s nephew, Jaafar Jackson, takes on the role of Michael, impressing viewers with his performance.

Since its release last Wednesday, the film has already grossed approximately $217 million (£160 million) worldwide.

Previously, the 2018 Queen biopic Bohemian Rhapsody – featuring Rami Malek as Freddie Mercury – held the record for the highest opening for a music biopic, debuting with $124 million.

However, “Michael” has now surpassed even the $180 million milestone set by Oppenheimer.

Blending musical brilliance, dramatic storytelling, and advanced cinematic techniques, this film is poised to become a landmark production that paves the way for future works in the genre.

Afternoon showers, thundershowers to continue across Island (April 28)

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April 28, Colombo (LNW): Showers or thundershowers will occur at several places in the most parts of the island after 1.00 pm.

Showers are likely at some places in Southern province and in Ampara district during the morning too.

Fairly heavy falls above 75 mm are likely at some places in Western, Sabaragamuwa, Central, North-western, North-central and Southern provinces and in Mannar district.

Misty conditions can be expected at some places in Central, Sabaragamuwa and Uva provinces and in Anuradhapura and Kurunegala districts during the early hours of the morning

The general public is kindly requested to take adequate precautions to minimise damages caused by temporary localised strong winds and lightning during thundershowers.

Marine Weather:

Condition of Rain:
Showers or thundershowers will occur at several places in the sea areas off the coast extending from Puttalam to Pottuvil via Colombo, Galle and Hambantota.

Winds:
Winds will be southerly or variable. Wind speed will be (20-30) kmph.

State of Sea:
The sea areas around the island will be slight to moderate.

Temporarily strong gusty winds and very rough seas can be expected during thundershowers.

NDB Crisis Deepens: Audit Shake-Up amid Governance Scrutiny

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By: Staff Writer

April 27, Colombo (LNW): The Rs. 13.2 billion internal fraud at National Development Bank PLC (NDB) continues to expose critical governance and oversight failures, even as new developments in the bank’s audit framework raise further questions about transparency and accountability. While the forensic audit led by Deloitte Touche Tohmatsu India LLP is underway, recent decisions regarding external and internal audit functions alongside the continued tenure of the same board of directors are intensifying scrutiny.

In its latest disclosure, NDB confirmed that KPMG has been appointed as External Auditor for the financial year ending 31 December 2026, following shareholder approval at the Annual General Meeting held on 27 March 2026. Consequently, Ernst & Young has ceased to hold office. The bank stated that this transition was made to comply with regulatory requirements under the Banking Act and corporate governance rules issued by the Central Bank of Sri Lanka, which mandate auditor rotation after a maximum engagement period of six years.

While auditor rotation is a standard governance practice intended to preserve independence, its timing amid an ongoing forensic investigation into a massive fraud raises concerns about continuity and institutional memory. External auditors play a key role in assessing financial statements and internal controls; a transition at this juncture may complicate the broader effort to understand how systemic failures went undetected for nearly 18 months.

Simultaneously, the forensic audit continues to report directly to the CBSL, bypassing the NDB board to ensure independence. This unusual structure reflects regulatory caution, implicitly acknowledging that existing governance mechanisms may not be fully reliable. The audit’s mandate includes reconstructing fraudulent transactions, identifying responsible parties, and uncovering weaknesses in internal controls and oversight.

However, the continuation of the same board of directors whose leadership was accountable for all functions during the fraud period and remains so today casts a long shadow over these corrective measures. In most comparable cases, leadership changes are seen as essential to restoring trust and enabling unbiased reform. At NDB, the absence of such changes risks undermining both the perception and the effectiveness of ongoing investigations.

Adding another layer of complexity is the appointment of a new internal audit function despite the active forensic audit. While strengthening internal audit capabilities is generally a positive step, introducing a new team during a forensic probe raises questions about role clarity, independence, and potential overlap. Internal audit typically operates within the governance framework set by the board raising concerns about whether it can function objectively when that very framework is under scrutiny.

The coexistence of three audit layers external (KPMG), forensic (Deloitte), and internal (newly appointed) creates a dense and potentially fragmented oversight environment. Without clear coordination, this could lead to duplication of efforts, inconsistent findings, or gaps in accountability.

For stakeholders, these developments present a mixed picture. On one hand, regulatory compliance and enhanced audit structures suggest an effort to strengthen governance. On the other, the lack of visible accountability at the board level and the timing of these changes raise doubts about whether reforms are sufficiently deep or merely procedural.

Ultimately, the effectiveness of these measures will depend on execution. The forensic audit must remain the central pillar of truth-finding, while new audit appointments must demonstrably enhance not dilute oversight. Without decisive governance reforms, NDB risks prolonging its crisis and eroding confidence in both its leadership and Sri Lanka’s broader banking system.

Fragile Export Recovery Raises Concerns over Economic Stability

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By: Staff Writer

April 27, Colombo (LNW): Sri Lanka’s export sector is showing signs of recovery in early 2026, but the rebound remains uneven and fragile, raising concerns about the country’s ability to sustain economic stability in the face of rising external pressures.

According to recent trade data, total export earnings in the first quarter of 2026 rose by 1.6% year-on-year to exceed $4.3 billion. Merchandise exports increased modestly by 1.2% to over $3.3 billion, while services exports performed slightly better, growing 3.13% to $921 million. Key contributors included ICT and business process management, construction, financial services and logistics.

While these figures suggest a gradual improvement, a closer look reveals underlying weaknesses. Export momentum faltered in March, with total earnings declining 5.2% compared to the same period last year. Merchandise exports dropped by nearly 5%, while services exports fell by over 6%, reflecting disruptions in global trade flows and ongoing logistical challenges.

This volatility underscores the structural weaknesses highlighted by the Asian Development Bank. Sri Lanka’s export base remains narrow and heavily reliant on a few key products and markets. The United States, European Union and United Kingdom collectively account for more than half of export demand, making the country vulnerable to shifts in external economic conditions.

The limited diversification not only constrains growth but also amplifies risk. Any downturn in major markets or sectors particularly apparel can have an outsized impact on overall export performance and foreign exchange earnings.

Despite these challenges, the services sector offers a glimpse of future potential. The ICT and business process management industry continues to expand, providing higher-value exports and better-paying jobs. This shift toward knowledge-based services could help reduce dependence on traditional goods exports over time.

However, translating potential into sustained growth will require more than incremental gains. Structural reforms, improved trade facilitation, and investment in innovation and skills development are critical to strengthening competitiveness.

The stakes are high. As Sri Lanka navigates a period of fiscal consolidation and rising external debt obligations, export earnings will play a central role in maintaining balance of payments stability. Without consistent and robust export growth, pressure on the currency and foreign reserves is likely to persist.

In this context, the recent uptick in exports, while encouraging, falls short of what is needed. The data point to an economy still struggling to regain its footing in global trade, with recovery vulnerable to both domestic constraints and external shocks.

Ultimately, Sri Lanka’s path to economic resilience will depend on its ability to transform a fragile export recovery into a sustained and diversified growth engine.

CEB Losses Deepen Despite Tariff Cuts and Reform Efforts

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By: Staff Writer

April 27, Colombo (LNW): Sri Lanka’s power sector remained under intense financial pressure in 2025, with the Ceylon Electricity Board (CEB) posting a loss of Rs. 38.7 billion despite multiple tariff adjustments and ongoing reform measures, according to the Central Bank’s Annual Economic Review.

The losses highlight a persistent imbalance between electricity pricing and generation costs. At the start of the year, tariffs were reduced by an average of 20% in January 2025, following earlier cuts in 2024. While intended to ease consumer burdens, the move significantly weakened the CEB’s revenue base. At the same time, a dry spell forced increased reliance on expensive thermal power generation during the first quarter, sharply driving up operational costs.

Although a 15% tariff hike was introduced in June 2025 to counteract these pressures, it proved insufficient to offset earlier losses. Financial strain continued to build, with short-term borrowings rising to Rs. 206.2 billion by the end of the year, up from Rs. 174.3 billion in 2024. Long-term liabilities also edged higher to Rs. 411.2 billion.

A further tariff increase of 10.3% came into effect in April 2026, reflecting continued dependence on price revisions to stabilize the utility’s finances. However, the repeated adjustments underscore the structural challenges facing the sector.

Electricity demand grew by 5.8% in 2025, mirroring the broader economic recovery. Growth was seen across all major consumer categories, with household demand accelerating from the second quarter. However, momentum slowed toward the end of the year due to disruptions caused by Cyclone Ditwah.

On the supply side, improved hydropower conditions provided some relief. Reservoir levels averaged 69.6% during the year, allowing hydropower to contribute 35.5% of total generation. Coal accounted for 27.4%, fuel-based generation 12.5%, and non-conventional renewable energy 24.7%. Solar power saw particularly strong growth, with rooftop installations nearly doubling, signaling a shift toward decentralized energy sources.

Structural reforms gathered pace during the year, including the passage of new legislation to restructure the CEB into four state-owned entities covering generation, transmission, distribution, and system operations. These changes are expected to enhance efficiency, improve governance, and introduce competition into the electricity market.

At the same time, investment in renewable energy infrastructure accelerated, with projects spanning hydropower, wind, solar, and battery storage. Funding support from international partners, including the Asian Development Bank, has played a key role in advancing these initiatives.

Despite progress, the Central Bank stressed that long-term sustainability will depend on maintaining cost-reflective pricing, deepening reforms, and expanding renewable energy capacity to reduce reliance on costly thermal generation.

Grey Nation Rising: Sri Lanka’s Workforce Crisis Deepens

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By: Staff Writer

April 27, Colombo (LNW): Sri Lanka is entering a decisive demographic turning point, one that could quietly reshape its economic future far more than any short-term fiscal crisis. The latest population data reveals not just how many people live in the country, but who they are and more importantly, who will be missing from the workforce in the years ahead.

The population now stands at 21.78 million, but the real story lies in its ageing structure. Nearly 18% of citizens are over 60, while the child population has fallen to just over one-fifth. With an Aging Index of 87, the country is approaching a balance where the elderly nearly match the young a stark reversal from past decades.

This shift is driven by a persistently low fertility rate of 1.3, well below the level needed to sustain population replacement. At the same time, the median age has climbed to 35, signaling a society that is no longer youthful but steadily maturing. The implications are clear: a shrinking pipeline of future workers and a rising burden on those who remain economically active.

However even within the existing working-age population, inefficiencies are glaring. Although 61.3% of Sri Lankans fall within working age, less than half actively participate in the labour force. Structural barriers—not a lack of opportunity alone are at play. Many women remain outside formal employment due to caregiving responsibilities, while a significant portion of men are still in prolonged education or lack market-ready skills.

Compounding this issue is a cultural and technological shift among younger generations. Increasingly absorbed in mobile phones and social media, many youths are disengaged from skill-building pathways that lead to productive employment. Digital literacy may be rising, but it does not necessarily translate into technical competence or professional readiness. This creates a paradox: a connected generation that is not fully equipped to contribute meaningfully to economic growth.

Meanwhile, the country faces a growing social care burden. Over 640,000 people live alone, with a majority being elderly women. Chronic illnesses are widespread, particularly among older populations, placing further strain on healthcare systems and public finances.

However, within this challenge lies an overlooked opportunity. Sri Lanka’s elderly population is not merely dependent it is also experienced, skilled, and potentially invaluable. Many retirees possess decades of professional, technical, and administrative expertise that remain untapped.

Countries like Japan have demonstrated how ageing societies can still thrive economically by integrating senior citizens into advisory and mentorship roles. In Japan, retired professionals actively support policymaking, corporate governance, and skills transfer, ensuring that institutional knowledge is not lost.

Sri Lanka could adopt a similar model. By creating structured platforms for retired engineers, teachers, administrators, and industry experts to mentor younger workers and advise government initiatives, the country could bridge its growing skills gap. Such engagement would not only reduce dependency but also reinforce institutional continuity.

The census ultimately presents a warning but also a roadmap. Without intervention, demographic trends could constrain growth and strain public resources. With strategic thinking, however, Sri Lanka can transform its ageing population into an asset, ensuring that experience complements youth rather than replaces it.

Government Ramps Up Emergency Housing Plan After Cyclone Damage

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April 27, Colombo (LNW): A high-level coordination meeting was convened at Army Headquarters to accelerate the construction of temporary housing for families displaced by Cyclone Ditwah.

The session was led by Deputy Defence Minister Aruna Jayasekara, who underscored the urgency of providing safe shelter to those affected.

Officials reviewed the current pace of work and explored ways to fast-track the rollout of interim housing across some of the hardest-hit districts, including Kegalle, Kandy, Nuwara Eliya and Badulla. Authorities indicated that the initiative aims to relocate around 1,000 displaced residents into secure, liveable accommodation as quickly as possible.

Construction work is expected to begin in early May, with the Sri Lanka Army taking a leading role in delivering the project. Military engineers and personnel are set to be deployed to ensure rapid progress while maintaining structural standards.

The programme forms part of the Government’s broader “Rebuilding Sri Lanka” effort, which seeks to restore communities impacted by natural disasters. During the meeting, the Deputy Minister called for a comprehensive action plan with firm deadlines, noting that delays could worsen the hardship faced by affected families.

Discussions also highlighted ongoing efforts to identify suitable land for the shelters. This process is being carried out in coordination with district authorities and technical experts from the National Building Research Institute, with a strong emphasis on selecting locations that meet safety and environmental criteria.

Emphasis was placed on maintaining transparency and accountability throughout the project, alongside improving collaboration between agencies to prevent bottlenecks. Senior military officials, representatives from disaster management bodies, and housing authorities were present at the meeting, reflecting a multi-agency approach to the recovery effort.

President Pushes for Faster Tax Reforms and Digital Overhaul

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April 27, Colombo (LNW): President Anura Kumara Dissanayake convened a high-level meeting with senior officials from the Inland Revenue Department this (27) afternoon at the Presidential Secretariat, signalling a renewed push to strengthen the country’s tax administration.

Talks centred on expanding the national tax base, improving compliance among taxpayers, and accelerating the recovery of long-overdue revenue. Officials also presented an overview of the department’s performance so far in 2026, highlighting both progress made and areas still requiring attention, according to an official communication.

A significant portion of the discussion focused on modernising the institution itself. Plans to restructure internal operations and introduce more advanced digital systems were examined in detail, with emphasis on improving efficiency and transparency. Among the key initiatives reviewed was the rollout of a nationwide electronic invoicing platform, seen as a cornerstone of future tax reforms.

The President urged authorities to adhere strictly to deadlines, stressing that delays would undermine broader fiscal objectives. He called for tighter coordination and accountability to ensure the successful implementation of these reforms.

Several prominent figures were in attendance, including Anil Jayantha Fernando, who serves as Minister of Labour and Deputy Minister of Finance and Planning, as well as Deputy Minister of Economic Development Nishantha Jayaweera. Also present were Presidential Secretary Nandika Sanath Kumanayake and Inland Revenue Commissioner General R. P. H. Fernando, alongside other senior officials.

Special Traffic Arrangements Announced in Colombo for “Ehipassiko Walk for Peace” Finale

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April 27, Colombo (LNW): A traffic management plan will be implemented across Colombo tomorrow (28), in connection with the concluding event of the “Ehipassiko Walk for Peace,” the Police Media Division has confirmed.

In an official statement, police said the programme is set to commence at 4:00 p.m. at Independence Square in Colombo 07, under the patronage of President Anura Kumara Dissanayake.

To facilitate the event, vehicle movement will be restricted from 11:00 a.m. onwards along a number of main roads, depending on prevailing conditions. The affected routes include Baseline Road (from the Bandaranaike Roundabout to Borella Junction), Maradana Road, Nandadasa Kodagoda Mawatha, Ward Place, Zoysa Roundabout, Lipton Roundabout, Dharmapala Mawatha, F.R. Senanayake Mawatha, C.W.W. Kannangara Mawatha, Horton Roundabout, the vicinity of Nanda Motors, Nidahas Mawatha, Premasiri Kemadasa Mawatha, Cambridge Place, the Glass House area, Marcus Fernando Mawatha, Library Junction, Flower Road, Pittala Junction, James Peiris Mawatha, Muttiah Road, Baybrook Road, Staple Street, Gangaramaya Temple Road, as well as all surrounding roads in the vicinity of Gangaramaya Temple.

Sri Lanka Police have urged motorists and the public to use alternative routes wherever possible to ease congestion and reduce inconvenience during the period of restrictions.

The internationally recognised “Walk for Peace,” which commenced on April 22 from Dambulla, will reach its conclusion in Colombo tomorrow. The spiritual procession has journeyed through several major cities, including Kandy, carrying a sacred Bodhi sapling from the revered Jaya Sri Maha Bodhi, while promoting messages of unity, compassion, and social harmony.

The concept follows an earlier international initiative, during which more than 200 Buddhist monks undertook a 110-day peace march across the United States, travelling from Texas to Washington, crossing ten states and attracting global attention.

The Sri Lankan event of the “Ehipassiko Walk for Peace” has been organised with state sponsorship. A group of monks led by Venerable Pannakara Thero of Vietnam has arrived in the country to take part in the walk.

Accompanying the monks throughout the procession is a dog named “Aloka,” which has drawn interest as an unusual yet endearing participant in the journey.

MP Archchuna Ramanathan Held After Firearm Allegation in Jaffna Land Row

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April 27, Colombo (LNW): MP Archchuna Ramanathan has been taken into police custody following a confrontation in Periyavilaan, Jaffna, where he is accused of threatening two women with a pistol during a dispute over land ownership.

Police confirmed that one of the women involved in the altercation was also arrested on Sunday (26), as inquiries continue into the incident, which has heightened tensions in the area.

According to investigators, the dispute began when the MP arrived at a plot of land he maintains is legally his, intending to begin preparatory work. However, another party contested his claim, leading to a heated exchange. Matters reportedly escalated when two women challenged his presence on the property.

Eyewitness accounts suggest that during the argument, the MP, appearing agitated, allegedly drew a firearm and directed threats at the women, who were unarmed at the time. The incident quickly drew public attention, prompting police intervention.

It is understood that the Mallakam Magistrate’s Court had earlier issued an order recognising the MP’s ownership of the land and permitting construction activities. Despite this, competing claims over the property appear to have reignited the conflict when he visited the site.

Authorities have stated that further investigations are in progress, including efforts to verify witness statements and examine any available evidence related to the alleged use of the weapon.