3 July, 2022


Bond Scam: Unity Government Has Its Own Check & Balance

By Jehan Perera

Jehan Perera

When the news of irregularities in the issuance of Central Bank bonds under the newly elected government came to light in March 2015 it seemed to be another story that would end up as only a story. Many had voted for the new leaders because they promised to be transparent and non-corrupt. Human beings have a great need to believe in something good that will come in the future to sustain their hope and thereby their lives. The hope of those who voted for the new government was that its leaders would not be corrupt and they would have the capacity to lead the country to become a developed one like many countries of Southeast Asia have become in a short period. Denials of wrongdoing on the part of government leaders were therefore convenient to accept by many had who voted for change.

However, when the Commission of Inquiry appointed by President Maithripala Sirisena began their hearings, which were publicized in the media, the faith in the probity of government leaders became eroded. There is a strong desire in the country that the practice of corruption especially at the top should not be permitted to continue. The commissioners, who had proven track records of competence, conducted themselves in a restrained manner but did their task well. Prime Minister Ranil Wickremesinghe volunteered to come before them and give evidence.  There is criticism that the Prime Minister was not subject to the tough cross examination that some of the others who came before the commission had to cope with. But this did not stop the commission from issuing strictures on him too. The report of the bond commission has stated that the prime minister should not have believed the central bank officials on the bond issue.

The significant fact is that a sitting prime minister was summoned before the commission and went before it. He was questioned by the commissioners and gave his evidence before them.  This has set a precedent that all are equal before the law. This is a practice in developed countries but not in the less developed countries. Sri Lanka is now on the path to being a developed country and there needs to be pressure from civil society, political parties and the courts of law to take it there. The prime minister has called for an early debate on the commission report in parliament. This will be an opportunity to discuss institutional reform that will ensure non-recurrence. Even if the past cannot be undone, the future can be different.

Political Tightrope 

The commission report has given to the president the opportunity to reaffirm his commitment to the political platform on which he sought election in January 2015. It also comes at an opportune time when he leads his party at the local election campaign. The main plank of that political platform at the presidential election three years ago was the issue of corruption in the acts of the previous government. In his election campaign the president pledged to eliminate corruption and to bring in good governance. However, the tight monitoring of corruption that was anticipated did not materialize. Instead sections of the government have careened into large scale corruption so much so that it have provided those in the former government to become a case study of the pot calling the kettle black.

In this context, President Sirisena’s statement to the nation on the report of the presidential commission he appointed to investigate the Central Bank bond issue would have elevated his stature in the eyes of the general public. At a time when exemplars of non corruption and restraint in political life are few and far between, the President may be able to capture the space. It is notable that in his public statement the president was careful to restrict his comments regarding the prime minister and minimized his involvement in it.

In taking action on the recommendations of the bond commission the President has to walk a tightrope. On the one hand he has had to disclose the content of the report as there is a public demand for this. On the other hand, he has to be mindful to protect the government of which he is an integral part. The government of national unity is essentially a coalition between the UNP and SLFP. It is the UNP component of the government that is in the dock on account of the central bank scam. The president has been politically astute to utilize the commission report on the bond issues of 2015 to seek an investigation to previous abuses of Central Bank bond issues which would include the abuses by members of the previous government.

Checking Impunity

It has been frequently observed that Sri Lanka’s track record of acting on reports of commissions of inquiry has been poor. Hardly any commission report has been acted upon. Where the government is composed of one dominant party, the dominant party would be able to suppress inconvenient truths. Even in this particular case, when the prime minister appointed a team of lawyers associated with the UNP to do an assessment of the bond scam, they basically said things were okay. It needed the president’s intervention to get another investigative body appointed which would be more independent. The recommendations of the commission might not be implemented in full.  But the check and balance exerted by the SLFP will most likely ensure that some action will be taken. This will be better than before.

The value of the government of national unity is to be seen in the manner in which the abuse of the Central Bank bond issue of 2015 has been exposed. This was not the first occasion on which there were misgivings about the way Central Bank bond transactions took place. But the abuses of the past were never investigated in a comprehensive manner as they have been on this occasion.  The difference is that this time two parties are responsible for governance. If there was only one party responsible for governance, it is easier to suppress inconvenient truths. But when there are two parties, the truth tends to emerge.  Now that President Sirisena has set the course it is important that he see it through. The key would lie in the strengthening of institutions, so that the rule of law prevails, and not the rule of men.

Sri Lanka has many difficult challenges to face. The problem of corruption is only one of them. There is also the issue of the reconciliation process. The problems are difficult to resolve and have eluded solutions by governments of the past, but the two parties together can solve them much better than any single party. In the case of the reconciliation process, land held by the military still needs to be returned to civilians, the office of missing persons needs to be set up, and the constitutional reform process must not be abandoned.  In the case of the Central Bank bond scam those identified by the commission need to be held accountable. We must anticipate a day that will surely come when even the highest in the land is not immune from prosecution for wrongdoing that harm the country, like occurred recently in South Korea and many South American countries.

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Latest comments

  • 1

    Jehan. the bond report should not be used to achieve political purposes. The bulath kolaya is almost in 4th place, so the pohottuwa and bulath kolaya will use the bond report in every stage.

    • 0

      Technically it should not have been released before election. Lanakwe has been eagerly watching what was happening in Last American Presidential Election. Every Tom Dick & Harry do know what happened to Hillary Clinton by a wrong e-mail investigation report released. Chief election commissioner should have interfered and asked the EP stop it until February.

      • 0

        Releasing at the right time May- (repeat May) stop further Scams.

  • 1

    It’s a precedent the current prime minister appeared before a commission of enquiry in which he, too, was accused of wrong doing. The previous government members and officials appointed by the president himself were involved in frauds and corrections yet they are free at large and he enjoys freedom by sweeping everything under the carpet and the parliamentary seat that he was elected after losing two elections as a punishment for his own involvement under his presidencies.
    The current president has come clean by appointing a commission of enquiry for the allegations of corruption in the bond issue whereas numerous allegations of wrong doing that took place under the watch of his predecessor are yet to be investigated in full.

  • 0

    J P
    SL appears to be a basket case, no better than Mugabe’s Zimbabwe. The political culture is toxic. “Old Hacks” have dominated politics for too long and thinking is still very self centered. New young blood is the answer.
    A constitutional change mandating term limits to all politically elected representatives might be the answer.
    Young blood is what is needed, the “old” should retire gracefully and give the chance for the country a chance to prosper. It’s the only hope. “CHANGE”

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