April 29, Colombo (LNW): A significant step toward overhauling the governance of state-run commercial entities has been taken, with Cabinet ministers giving their backing to a draft proposal aimed at establishing a modern legal structure for the management of State-Owned Enterprises (SOEs).
The draft legislation, if enacted, will mark a fundamental shift in how public-sector commercial ventures are administered, with a clear intent to reduce political interference and improve operational efficiency.
Addressing journalists at a briefing held this (29) morning, Cabinet Spokesman and Minister of Health and Mass Media Dr. Nalinda Jayatissa, explained that the initiative reflects the government’s wider ambition to transform the SOE sector into one that operates on professional, economically viable, and transparent lines.
He stated that state enterprises should no longer be allowed to remain a persistent liability on public finances and the broader economy, but instead be steered with a more performance-driven ethos, including through partnerships with both domestic and international investors.
The government’s position is that a legally enforced structural reform is long overdue, given the recurring fiscal burdens and allegations of mismanagement that have plagued the sector for decades.
Dr. Jayatissa noted that the draft bill, provisionally titled the “State-Owned Commercial Enterprises Management Bill,” proposes to insulate public enterprises from political patronage and instead enable the appointment of qualified professionals to key decision-making positions.
This would, in theory, align these enterprises with modern governance standards and enhance accountability.
To refine the draft legislation and ensure it reflects practical needs as well as policy intent, the Cabinet has also endorsed the formation of a dedicated review committee. This body will be responsible for scrutinising the bill and offering further recommendations to enhance its scope and applicability.
The committee is to be chaired by Dr Anil Jayantha Fernando, who holds ministerial responsibility for Labour and serves as Deputy Minister of Economic Development.
He will be joined by Minister of Industries and Entrepreneurship Development, Sunil Handunnetti, and Minister of Trade, Commerce, Food Security and Cooperative Development, Wasantha Samarasinghe.
The proposed legal reforms are expected to regain public confidence in state institutions and ensure that public assets are managed not only responsibly, but also with a focus on long-term sustainability.
With many SOEs struggling with outdated structures, political appointments, and inefficient management, the new bill seeks to establish clear operational guidelines, performance benchmarks, and enhanced oversight mechanisms.
Although still in its early stages, the approval of the draft bill in Cabinet signals the administration’s intent to follow through on its promises of institutional reform.
It is also expected to pave the way for future discussions in Parliament, where the finer details of the proposed law will be debated and possibly amended before being passed into law.
