Trade Minister Bandula Gunawardena says that the amendment of the Fiscal Management Responsibility Act to suit various political needs has led to the current economic crisis and that he and the government should take responsibility for it.
“What needs to be done in the future is to reactivate the Fiscal Management Responsibility Act and to unite without any political party affiliation. If I mention that, this mistake is always made by politicians and Parliament in Sri Lanka. It is not good to do that. Because Article 148 of the Constitution of Sri Lanka gives Parliament the power over public finances. As Parliament manages this public finances according to various political needs, a separate law was passed to change it. That is the 2003 Fiscal Management Responsibility Act. There are three points. The first is to reduce Sri Lanka’s budget deficit to less than 5% of GDP. Second, reducing the nation’s debt to 60% by 2013. Third, the government will reduce the loan guarantee limit to 4.5%.
What did we do about it? If that had been done this crisis would not have arisen today. There is no simple answer to this, there is a theoretical answer to this in the world. That is the answer that Parliament has passed as a law.
But since then we have increased the guarantee from 4.5% to 15% from time to time. Then we amended the 60% debt reduction to 80%. It has been amended that 80% will be done by 2030. So no matter how much we talk about it, it comes back. This was the condition when I went to the IMF last year. But that law has changed, they are never talking about this fact. Ordinary people do not understand this. A bill has been brought for this and the responsibility has been handed over to Parliament. The bill has been amended to suit officials and other political interests. Therefore, we need to correct that mistake. We have to admit in Parliament that something went wrong ”
Minister Bandula Gunawardena stated this while participating in a political discussion held on Derana TV yesterday (16).
Gunawardena later admitted that three amendments had been made to the Fiscal Management Responsibility Act and that all three amendments had been brought by PB Jayasundera under their government.
