The government is compelled to settle unpaid bills of about Rs. 200 billion, mainly to the construction and various other institutions, says the Secretary to the Ministry of Finance Mahinda Siriwardana.
Finace Ministry is taking prompt action to pay the money owed to the public construction contractors in several phases, official sources said.
Accordingly, before the end of this year, an amount of Rs 20 billion rupees is expected to be disbursed and the government is currently working to pay all the remaining arrears in the first quarter of next year.
Sri Lankan government construction contractors numbering around 3000 are in an urgent need of funding for their survival as they have to recover Rs. 150 billion outstanding payment for the work completed in public construction projects including buildings and infrastructure facilities.
Mr Siriwardana stated that the government has come up with revenue and tax policies because the government is unable to pay those bills.
The Treasury Secretary disclosed these details s while speaking during a post-budget seminar on the 2023 budget, under the theme “Dissecting the Budget 2023”, at the Central Bank in Colombo yesterday (15).
“On day-to-day operations when you are maintaining the cash flow, I see how difficult it is. Because your revenue is not sufficient even to pay for your essential items like the salaries, wages, maybe subsidies and all sorts of things.”
“And as a result, I have indicated this earlier also, we have unpaid bills of about Rs. 200 billion and mainly those are to the construction and various other institutions. And as a result, I know the pain that these specific sectors are going through,” he said.
“But unfortunately the government is not in a position to pay those things. “However, he said that at the same time while paying all these essential items, the government has to manage the other things as well. “And at the same time, we have to contribute to the strengthening of stabilization process as well.”
The Finance Secretary said that the reduction of expenditure is again not an easy task. “That is where the government has come up with revenue policies and tax policies to increase the government revenue.”
“So you have to maintain the public sector and you have to continue the government machinery and at the same time you have to contribute the stabilization. So you have to maintain a balance between these two,” he added.
Siriwardana also said that stabilizing the economy remained a challenge and the private sector must perform its role in aiding the government in pulling the economy out of crisis.
He said the government was setting up a Presidential Committee to monitor and ensure timely implementation of budget proposals.
