14 October, 2024

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Governmental Expenditure Vs. Sustainable Growth In Sri Lanka

By Sunil J. Wimalawansa

Prof Sunil J. Wimalawansa

Over the past few decades, people witnessed disruptive politicians who governed the country returning to power. However, this change somewhat in 2024, voters are making decisions based on policies than just for a party. This sentiment is reflected in the over 4.7 million voters (out of 6.9 million) who previously voted for the former President but have now supported the current President, Anura Kumara Dissanayake. This is a clear objection and a mandate to keep them out and initiate a complete system change. Additionally, those who voted for the current President on September 21st, along with a growing number of others, are advocating for legislation that would permanently disqualify corrupt politicians from holding any elected or appointed positions in the future.

Changing Voters Behaviour and Necessary Changes

Most voters expect the new government to introduce enforceable legal restrictions to prevent the nomination of individuals who have harmed the country and its people. While opinions may vary, the basic qualifications voters hope for include disqualification for those involved in financial scandals, misappropriation of public funds, violence, criminal records, or indictment for unethical business practices. People with ties to the country’s bankruptcy deemed untrustworthy and should also be ineligible for nominations or any appointment.

There are other criteria that may be controversial but should be debated and evaluated for the betterment of the nation in the longer term. For example, an age range (e.g., 35 to 75 years at the time of nomination) and a requirement for a university degree, and elimination of those with criminal complaints or convictions. These may be unpalatable for some, and others consider it discriminatory, but one should consider what is best for the country.

To prevent politicians from becoming entrenched and ineffective, a term limit on any elected political position should be introduced. If such policies are adopted, more than half of the current parliamentarians would be disqualified from holding or submitting nominations for government positions—an efficient way to remove them. Most voters hope this will become a reality.

The focus on sustainable growth

The new government should publish immediate, medium-, and long-term economic policies with clear plans detailing how it intends to generate the foreign exchange needed to repay loans, run the country without accruing additional debt, and import essential goods not produced domestically. With the right strategies and a potential restructuring of the IMF loan, perhaps transferring it to a friendly, sympathetic country like Japan, this can be achieved without raising taxes and further burdening the population.

Besides, the government must facilitate and incentivize the growth of value-added exports like graphene oxide and enriched minerals, while implementing sustainable financial and developmental practices. This should include systematically expanding tourism (including ethical medical tourism) and renewable energy sources to reduce dependence on imported fuel and strive for self-sufficiency in energy, essential food, and medicine.

To illustrate its ability to control the situation, the government must also develop a concrete plan to support the growth of small and medium-sized businesses, encourage exports, simplify regulations, and consider tax cuts. While tourism should be developed, it must be done systematically—not haphazardly, as was the case with previous governments. Additionally, the government should avoid relying solely on tourism for economic stability, as it is vulnerable to uncertainties stemming from the rapidly changing world order, travel restrictions, and external economic shocks.

Reduction of government size and expenses

Import restrictions are crucial to reducing the budget deficit and should focus on promoting fuel-efficient vehicles. It is crucial to ensure no more import-related commissions and associated major financial scandals. A committee of genuine experts must be appointed with a set timeframe to identify the root causes of financial failures across various sectors, economic, social, and governmental. Appointing a commission of retired executives with no conflicts of interest to come up with a plan to hold responsible individuals accountable and recover those siphoned assets and funds working with international authorities is also a crucial way to bring back such to the treasurer.

Curtailing Wasteful Foreign Travel

Most foreign travel by politicians and administrators does not bring significant value to the country. Therefore, such travel must be minimized and funded strictly through each ministry’s budget, not by foreign embassies, as was previously done, where taxpayers covered expenses. Additionally, there is no need for ceremonial openings and lavish events to be conducted at taxpayer expense. Savings from these reductions can be redirected to critical areas like modernizing agriculture, education, research and development, and infrastructure, which are essential drivers of the country’s economy.

For a bankrupt country, there is no need for ceremonial openings and lavish events to be conducted at taxpayer expense—they are highly inappropriate. Besides, it is irrational to invite politicians for such constructions, that were funded by taxpayers. Savings from these reductions can be redirected to critical areas like modernizing agriculture, education, research and development, and improving indispensable infrastructure, which are essential drivers of the country’s economy.

Accountability and Enforcement of Laws

It is the fiscal responsibility of the new government to enforce personal answerability of all ministries, government departments, and state own enterprises and hold them legally and financially accountable. It must be mandated that all state-owned enterprises operate without incurring losses, failing which senior administrators must be terminated at the end of the year. Achieving this requires learning from rapidly developing emerging economies and implementing proper oversight, including mandatory annual audits and robust reporting mechanisms, and enforcing laws.

Curtailing Government Expenses

Despite pressure from the public, unions, and NGOs, government expenditure must be reduced. The current government is highly inefficient despite operating at approximately 50% overcapacity. Government departments are both top-heavy and bottom-heavy, with the middle management—the segment that contributes the most to any department’s functioning—shrinking relatively. This has led to rampant inefficiency. Thus, it is not surprising its ineffectiveness, which also allows opportunities for bribery.

Therefore, a program should be implemented to gradually reduce the size of the government , including the over-blown military by eliminating 40% of non-productive positions. Such would make operations more cost-effective and accountable. There is absolutely no justification for expanding the government; instead, public sector jobs must be restricted, and the private sector should be encouraged to expand to foster job creation across the country.

The new NPP government must uphold its election promises without exceptions by focusing on eliminating corruption at every level. This will become easier if it gains the majority in the next parliament. This includes re-establishing independent committees and commissions with legal powers to prosecute, establishing sustainable economic policies and practices, limiting the number of ministers and ministries, reducing perks that ordinary citizens do not enjoy, and ensuring that ministers and government administrators are held accountable.

Latest comments

  • 8
    0

    See article on Island 1) PMD reveals the sheer number of vehicles used by Presidential aides. In a bankrupt country, Rosy was given a Porsche Cayenne, Merc to Seetha, Land Cruiser to Diana , more than 100 vehicles allocated to so called Presidential staff alone. ( Presidential secretariat NOT included ) 2) Many family members of RW, Siripala, SBD …….. are currently on payroll, appointed as staff in Lankan high commissions , embassies and other diplomatic circles. These are just the tip of an iceberg. Think about the total govt expenditure ????

  • 4
    1

    A re asonable request for AKD & the new govt. that will be elected. I am particularly keen to know the sources of funding of the new govt. In UK, election expenditure is capped & has to be disclosed, as well as, all major donations . All contenders have to disclose their wealth & their CVs are available for public scrutiny. AKD was in UK during UK elections & I hope he has learnt from UK & will introduce some of the mandatory requirements in SL too, to ensure the right caliber of people are given nominations.

    As the author states, tourism is the golden goose but it should be sustainable without harming the environment. Many countries dependent on tourism have imposed restriction to prevent ‘overtourism’. For example, Machu Picchu, restricts the daily visits to the sacred site, & the SL tourist board should restrict visit to national sites like Yala & let the poor animals some freedom without hordes of tourists in SUVs invading their habitat. Sacred sites should also prevent touts & opportunist from fleecing tourists. There are many other areas that need reforming & the expectation from the new President is high. AKD may be sincere in his promises & I hope he has the ability to start cracking ASAP.

    • 1
      3

      Thank you, Raj.
      .
      This is a very positive comment. I agree absolutely.
      .
      Please continue in this vein, and I will not be critical of you. If you look at all the comments that I have ever made, you will find that although I have had reservations, I have always asserted your shining honesty.
      .
      https://www.colombotelegraph.com/index.php/welcome-comrade-anura/
      .
      and I have continued here in the same vein:
      .
      https://www.colombotelegraph.com/index.php/battle-for-the-parliament/
      .
      I think that I have mentioned you by name there, but some updates are on their way, so I’ve not got the time to recheck.
      .
      Panini

      • 1
        1

        SM

        I have always said that AKD is above the current yobs we had in Parliament & had my respect but it was his leftist leanings that I disagreed on. We all know that his promises are difficult to achieve & I hope he won’t hit a blank wall & all those promises become water under the bridge.

        If I was in SL, I wouldn’t like to live under a ‘socialist’ govt & I hoped the best of SJB & UNP would get together with RW, his laissez faire approach would be balanced by the more capable in his team but that’s wishful thinking. The possibility of SP as PM is more frightening than a leftist govt.

        • 0
          0

          “it was his leftist leanings that I disagreed on”
          What a confession from a Brown Tory.

  • 3
    1

    While there are numerous experts now popping up and advising the new administration on how to run the country, it is important to note that the now redundant failed politicians will all get onto one log in fear of the coming floods. That alone shows them up for what scum they have been all along, without principles, accepting any and every criminal based on their ability to garner votes and nothing else. If the people are any wiser than in previous years, they will all vote for a strong NPP government that will save future generations from the misery that previous regimes collectively inflicted on the poor hapless people.

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