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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.

Ministry pledges firm response amid tragedy at Sabaragamuwa University

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May 01, Colombo (LNW): The Ministry of Higher Education has pledged decisive action should it be established that the recent death of a student from Sabaragamuwa University was the result of ragging.

In a statement released to the media, the Ministry confirmed that a formal investigation is now underway and that a dedicated inquiry team has been appointed to examine the circumstances surrounding the incident.

The case concerns the tragic death of a second-year undergraduate from the Faculty of Technical Engineering, who was found dead by suicide at his residence in Gampola on April 29.

The student had reportedly returned home after participating in the university’s Sinhala and Tamil New Year festivities. Allegations have since emerged suggesting that the student endured significant emotional distress linked to degrading treatment by fellow students during the celebration, with some relatives and friends claiming that this humiliation may have directly contributed to his death.

Responding to the growing public concern and extensive media coverage, the Ministry acknowledged the seriousness of the allegations and confirmed that it is working in close coordination with both the University Administration and the University Grants Commission (UGC).

Should the findings of the investigation substantiate the claims of ragging, the Ministry assured that firm disciplinary and legal measures would be imposed against all those implicated.

This incident has reignited public debate over the ongoing presence of ragging within Sri Lankan universities—a practice that has been widely condemned yet persists in various forms across institutions.

Whilst once dismissed as a rite of passage, ragging has increasingly been associated with patterns of psychological and physical abuse, with calls intensifying for stricter enforcement and preventative measures.

The Ministry’s latest remarks appear aimed at sending a strong message, not only to university communities but also to the wider public, about the zero-tolerance policy it claims to uphold regarding student harassment and abuse.

Officials have stressed the importance of fostering a safe and respectful environment within higher education institutions, whilst reiterating that mental health and student welfare must be central priorities.

EU delegation engages in high-level dialogue on governance and trade in Colombo

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May 01, Colombo (LNW): A visiting delegation from the European Union has held discussions with Sri Lanka’s Minister of Foreign Affairs, Foreign Employment and Tourism, Vijitha Herath, at the Ministry’s headquarters in Colombo, as part of a formal review mission connected to the GSP+ trade concessions framework.

The EU mission, comprising senior officials, is in the country to assess Sri Lanka’s ongoing efforts to uphold the commitments required under the Generalised Scheme of Preferences Plus (GSP+)—a trade arrangement that grants developing countries preferential access to the European market, contingent on the implementation of 27 international conventions relating to human rights, labour standards, environmental protection, and good governance.

During the meeting, Minister Herath outlined the key policy reforms undertaken since the current government assumed office, particularly in relation to the fight against corruption, strengthening democratic institutions, safeguarding human rights, and advancing reconciliation efforts.

He further assured the delegation that the government remains committed to introducing legislative reforms and administrative measures designed to uphold the values that underpin the GSP+ mechanism.

Emphasising the historical cooperation between Sri Lanka and the European Union across various domains, Minister Herath expressed appreciation for the EU’s consistent support, especially in aiding the country’s economic stabilisation and recovery.

He highlighted the importance of continued collaboration, noting that the EU currently stands as Sri Lanka’s second-largest export destination—a critical partner in both trade and development.

The EU team, for their part, acknowledged Sri Lanka’s recent progress on multiple fronts and welcomed the government’s stated intentions to accelerate reforms.

They reiterated the bloc’s commitment to supporting Sri Lanka as it moves forward with its policy agenda, with particular emphasis on transparency, accountability, and inclusive governance.

The GSP+ review mission is part of a broader monitoring cycle, carried out biennially, to assess whether recipient countries are meeting the conditions of the programme.

The outcome of these evaluations directly influences Sri Lanka’s eligibility to retain its preferential trade access to the EU’s single market, which spans 27 member states and a consumer base of over 450 million people.

Digital journalists decry gov move to restrict media access

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May 01, Colombo (LNW): A leading organisation representing digital media professionals has condemned a new regulation introduced by Sri Lanka’s Department of Government Information, describing it as a direct assault on press freedom and democratic transparency.

According to the Professional Web Journalists Association, a recent decision by the department now makes it compulsory for journalists to obtain official government-issued media accreditation in order to gain access to post-Cabinet media briefings—an event traditionally open to a broader spectrum of media personnel, including independent and online platforms.

In a strongly worded statement, the association criticised the new measure as an unjustifiable barrier to journalistic practice, warning that it undermines the public’s fundamental right to information.

The group expressed grave concern that this development signals an alarming shift towards state control over media access, which could pave the way for selective inclusion and censorship.

“This requirement not only restricts journalistic activity but also casts a shadow over the government’s commitment to democratic principles,” the association noted. “Any attempt to filter who may or may not cover vital governmental proceedings betrays the spirit of transparency that must underpin any functioning democracy.”

The association further called upon the authorities to reverse the decision without delay, insisting that such restrictive practices risk alienating independent journalists and digital media outlets—many of whom play an increasingly vital role in delivering real-time, investigative, and community-based news to the public.

They warned that shrinking space for independent media would not only damage the international perception of Sri Lanka’s democratic institutions but also foster a climate of self-censorship, fear, and institutional mistrust.

Reaffirming its commitment to defend the principles of free expression, the group pledged to continue advocating for unrestricted access to public information and to uphold the tenets of ethical journalism.

In an age where digital platforms have become central to shaping public opinion and holding power to account, the association argued, the government must recognise that media diversity is not a threat but a necessity in a healthy democratic society.

IMF urges acceleration of SriLankan Airlines restructuring and broader SOE reforms

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May 01, Colombo (LNW): The International Monetary Fund has called for swifter action on the restructuring of SriLankan Airlines and greater momentum in the overall reform of state-owned enterprises (SOEs), highlighting their importance in securing the long-term stability of the country’s public finances.

During a virtual briefing, Evan Papageorgiou, the IMF’s Mission Chief for Sri Lanka, outlined concerns regarding the pace of progress, noting that whilst the government has initiated several steps—such as the appointment of financial advisors for the airline’s international debt restructuring and a budgetary allocation of Rs. 20 billion to address legacy debt—more rapid movement is essential.

He stressed that resolving long-standing issues within the national carrier must remain a top priority to ensure its operational sustainability.

SriLankan Airlines, once considered a key asset in the nation’s aviation and tourism sectors, has become emblematic of the broader challenges facing SOEs in the country. Encumbered by mounting debts and years of financial mismanagement, the airline continues to draw heavily on state resources, creating pressure on the national budget.

Whilst a medium-term strategic plan is reportedly being developed to tackle these issues, the IMF is pressing for clear timelines and measurable outcomes.

The Fund also turned its attention to the broader landscape of SOEs in Sri Lanka, calling for decisive action to enhance transparency, governance, and efficiency. This includes avoiding further foreign currency borrowings by state entities, reducing reliance on sovereign guarantees, and improving financial reporting through the timely publication of audited accounts.

As part of the current programme, the government has pledged to release audit reports for 52 key SOEs, a move seen as critical to rebuilding public trust and investor confidence.

Papageorgiou stressed that SOEs should be managed with the same efficiency and accountability as private sector enterprises. “Consumers must receive value for the money they pay,” he said, emphasising the need for commercial discipline in sectors such as electricity and fuel distribution, which have been plagued by inefficiencies and political interference for decades.

While acknowledging recent progress, including an uptick in economic activity, improved foreign reserve buffers, and a sustained commitment to structural reforms, the IMF warned of external challenges that could derail recovery.

Papageorgiou pointed to uncertainties in global trade policy as a significant downside risk, cautioning that any deterioration in external conditions could necessitate a recalibration of policy responses.

Nevertheless, the IMF remains broadly optimistic about Sri Lanka’s reform trajectory. The government’s continued dedication to the programme’s objectives, particularly in the area of debt restructuring, was described as encouraging.

The near-completion of debt negotiations marks a key milestone, but the Fund insists that follow-through is essential—not just on paper but in the tangible transformation of state institutions.

Polling card distribution concludes as election day nears

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May 01, Colombo (LNW): The Election Commission has confirmed that the distribution of polling cards for the forthcoming local government elections has been finalised through the country’s postal network.

According to the Commission, the postal dispatch of these official documents has now reached its conclusion, ensuring that the majority of registered voters have already received their polling cards at their designated residential addresses.

However, acknowledging the possibility of logistical delays or missed deliveries, the Commission has made provisions for voters who are yet to receive their cards.

Individuals who have not yet obtained their polling cards will be able to do so by visiting the nearest post office associated with the address listed in the electoral register.

This service will be available during regular working hours until May 06. Voters are required to bring valid proof of identity—such as a national ID card, passport, or driving licence—in order to verify eligibility and collect the card assigned to their household.

In a bid to modernise the electoral process and increase accessibility, the Commission has also introduced a digital avenue for voters to access their polling cards. This new system is designed to streamline voter access and offer a supplementary method for those unable to retrieve their cards via post or in person.

The Commission reiterated the importance of the polling card, not only as an official notice of one’s voting rights but also as a means to facilitate a smooth voting experience at polling stations on election day.

Authorities have urged all eligible voters to ensure they are in possession of their polling cards well ahead of the polls, underscoring the card’s role in verifying electoral eligibility and streamlining identity checks at the booths.

May Day celebrations sweep across Sri Lanka amid diverse political messages

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May 01, Colombo (LNW): Sri Lanka’s political parties and trade unions are marking International Workers’ Day today with a multitude of rallies and parades held in various parts of the country, each group advancing its own message of solidarity, struggle, or resurgence, in what has become an important annual tradition.

At the heart of Colombo, Galle Face Green will host one of the day’s most prominent gatherings, where the National People’s Power (NPP) will rally under the banner “May Day Rally of the People’s Power Building the Country.”

This large-scale event will be presided over by President Anura Kumara Dissanayake, whose leadership has redefined the political narrative in the post-crisis era. Deputy Minister of Labour Mahinda Jayasinghe stated that all logistics and security arrangements for the rally have been finalised, with crowds expected from across the island.

In the central highlands, the Samagi Jana Balawegaya (SJB) is set to stage its main Labour Day observance at the Lindula Municipal Council Grounds in Talawakele. Party leader Sajith Premadasa will lead the gathering, rallying under the theme “Workers’ Power to Win the Country.”

The location is symbolic, as it lies in the heart of plantation country—a region with a deep-rooted labour history and ongoing demands for wage justice and improved working conditions.

The Sri Lanka Podujana Peramuna (SLPP), seeking to re-energise its base after a series of political setbacks, will bring its supporters together at the Ananda Samarakoon Open Air Theatre in Nugegoda.

Under the slogan “We Have Endured the Deception, Let’s Rise Up Now,” the party aims to position itself as the voice of those disillusioned with recent governance transitions. General Secretary Sagara Kariyawasam expressed confidence in a significant turnout, viewing the day as an opportunity to rally their traditional voter base.

At the Sri Lanka Freedom Party (SLFP) headquarters, the Podujana Eksath Peramuna will host a more restrained yet symbolically important celebration. Trade Union Coordinator Prasanna Kalutarage confirmed the event will focus on reaffirming the SLFP’s commitment to labour rights and social justice, themes that have historically formed the bedrock of the party’s ideology.

In Warakapola, the relatively newer political alliance ‘Sarvajana Balaya’ is planning a rally with a modern twist—focusing on transforming workers into entrepreneurs. Under the theme “The Worker Towards Entrepreneurship,” the event, led by MP Dilith Jayaweera, reflects a broader shift in political messaging, where labour empowerment is increasingly linked to innovation, self-reliance, and economic adaptability.

Meanwhile, the Frontline Socialist Party will hold its rally at the Lalith Athulathmudali Stadium in Kirulapone, with the participation of long-time activists and grassroots organisers. The party’s Education Secretary, Pubudu Jagoda, said the event will spotlight class struggle, workers’ dignity, and economic inequality—issues that remain unresolved despite waves of political change.

To manage the influx of participants and the logistical demands of multiple large-scale gatherings, the Police Media Division has implemented a comprehensive traffic control strategy.

With 15 locations in Colombo alone designated for processions and meetings, motorists have been urged to avoid key city arteries and instead use alternate routes where possible.

Security, public safety, and road discipline are being prioritised, with special teams deployed to coordinate event zones and ensure smooth proceedings.

Fuel prices drop, but bus fares remain unchanged raising public frustration

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May 01, Colombo (LNW): Despite a noticeable reduction in fuel prices announced by both the Ceylon Petroleum Corporation (CEYPETCO) and the Lanka Indian Oil Corporation (LIOC), passengers relying on public transport will see no relief in bus fares.

This decision has sparked renewed criticism over the disconnect between fuel pricing and public transportation costs in Sri Lanka.

Lanka Private Bus Owners’ Association Chief Gemunu Wijeratne has made it clear that bus fares will not be adjusted downwards, even though the cost of auto diesel—on which most buses operate—has been brought down by Rs. 12 per litre.

With diesel now retailing at Rs. 274 per litre, many commuters had anticipated a corresponding fare reduction, only to be disappointed.

The price revision, effective from midnight on April 30, has seen petrol and diesel fuels slashed significantly. Petrol Octane 92 has dropped by Rs. 6, bringing it to Rs. 293 per litre, while the higher-grade Octane 95 has fallen by Rs. 20 to Rs. 341 per litre. Super Diesel is now priced at Rs. 325, following a Rs. 6 cut, and Kerosene has been reduced to Rs. 178, down by Rs. 5.

President calls for renewed worker solidarity amidst national renewal in May Day message

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By: Isuru Parakrama

May 01, Colombo (LNW): President Anura Kumara Dissanayake, in his official message marking International Workers’ Day, asserted that the current administration has successfully laid the foundation for the country’s economic revival after decades of mismanagement, nepotism, and corruption.

His statement underscored the government’s ongoing efforts to rebuild the nation through policies aimed at equity, inclusion, and social transformation.

Reflecting on the origins of May Day, President Dissanayake paid tribute to the workers of Chicago’s Haymarket Square in 1886, whose demands for an eight-hour workday became the catalyst for the global labour movement.

He emphasised that Sri Lanka today stands at a similar turning point—one led by the will of the people to dismantle entrenched systems of privilege and reclaim governance for the broader public good.

The President highlighted several of the government’s early achievements, including what he described as landmark reforms: a significant increase in the minimum salary for public sector employees and a wide range of support schemes for farmers, fisherfolk, women, students, youth, and small-scale business owners.

These measures, he claimed, marked a departure from past policies that largely benefited a narrow elite.

He acknowledged the structural challenges inherited by his administration, including an economy left in ruins by years of political and fiscal mismanagement. However, he asserted that the government had managed to stabilise the situation and put in motion a recovery plan with visible progress.

Notably, Dissanayake reaffirmed his administration’s commitment to improving the living standards of plantation workers and ensuring their long-overdue civil rights are protected.

Beyond national concerns, the President’s address also looked to the future of global workers’ rights, calling for a new era in human rights that would include digital access, environmental protections, and civil liberties fit for the 21st century.

He pointed out that the evolving nature of global challenges necessitates an updated international framework—one that expands on the principles set out in the 1948 Universal Declaration of Human Rights.

He further acknowledged the burden borne by Sri Lankan workers in navigating the ongoing economic recovery, describing them as the backbone of the nation’s resilience.

In closing, he invited the working people of the country to stand together in unity, not only to defend their own rights but also to contribute to the larger mission of building a dignified, equitable society.

Intertropical Convergence Zone further affects island’s weather: Heavy falls about 75 mm expected (May 01)

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May 01, Colombo (LNW): The Intertropical Convergence Zone (where winds from the Northern Hemisphere and Southern Hemisphere converge) affects the island’s weather, and showers or thundershowers, therefore, will occur at most places of the island during the afternoon or night, the Department of Meteorology said in its daily weather forecast today (01).

Showers may occur in Southern and Western provinces and Puttalam, Ampara and Batticaloa districts in the morning too.

Fairly heavy falls about 75 mm are likely at some places in Central, Sabaragamuwa and Uva provinces and in Hambantota and Ampara districts.

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

Misty conditions can be expected at some places in Central and Uva provinces during the morning.

Marine Weather:

Condition of Rain:
Showers or thundershowers will occur at several places in the sea areas around the island.
Winds:
Winds will be south-westerly and wind speed will be (25-35)kmph. Wind speed can increase up to (45-50) kmph at times in the sea areas off the coast extending from Chilaw to Kankasanthurai via Mannar and from Hambantota to Pottuvil.
State of Sea:
The sea areas off the coasts extending from Chilaw to Kankasanthurai via Mannar and from Hambantota to Pottuvil will be fairly rough at times. The other sea areas around the island can beslight to moderate.  Temporarily strong gusty winds and very rough seas can be expected during thundershowers.

Protest against Pakistani Ambassador in Colombo over Pahalgam attack

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Indian-origin activists protest in Colombo over the terrorist attack on Pahalgam, a popular tourist destination in Jammu and Kashmir that left 28 people dead!

Activists and dignitaries of Indian origin held a protest against the Pakistani Ambassador in Colombo over the Pahalgam attack.

The protesters pointed out that no solution can be achieved by killing people, and instead, everyone should live in harmony, peace and harmony. They protested, demanding that Pakistan curb such barbaric acts and eradicate terrorists and terrorist activities operating in the country.