By Upali Cooray –
“There is a house available at Monarch residencies and it belonged to Nahil Wijesuriya’s (NW) daughter who is a friend of my daughter.” This extract is from MP Ravi Karunanayake’s (RK) statement in Parliament.
This story of RK& NW started more than 17 years ago. RK was appointed as the Minister of Commerce and Consumer affairs. NW was appointed as Chairman of SATHOSA by PM Ranil Wickremesinghe (RW) in President Chandrika Kumaratunga’s Government in the year 2001.
Nahil Wijesuriya (NW), one of the richest if not the richest, businessmen in this country. Coming from Trinity College Kandy, is a professional Engineer.
NW was a person in a hurry. He required results and motivated the existing staff to work according to his thinking. The Rajagiriya, Welisara and Jawatta super markets were brought up to higher standards of customer service on par with private owned super markets with online transactions for the shops including bar coding and stock control. Further plans were on, for expanding the online system, Island wide.
Pay increases on par with private sector were offered to attract skilled personal. He did not tolerate political influence. He supervised the engineering staff of SATHOSA day and night to give his skills in refurbishing the shops such as display arrangements and customer service. I personally consider him as a Maverick. That is his success as a businessman. However NK resigned suddenly just after I resigned in disgust from SATHOSA in July 2002. The reasons for NW’s resignation are not known to me. However I observed that he wanted to perform quite independently from the minister. Furthermore, He had his group of companies to look after. His frank view was SATHOSA staff was a hardworking and efficient lot.
Ceylon Biscuits, which put in a joint bid with another Sri Lankan firm, Carsons Group of Companies named International Grocers Alliance (IGA) was among the five parties that submitted bids for the sale of retail arm of SATHOSA consisting 150 units. The distribution of goods was handed over to a logistics company named LOGIVIS. Previously SATHOSA did its own distribution all over the country very successfully. To make a very long story short, appointing LOGIVIS was a disaster. IGA wanted a “state of the art” system introduced.
As a consequence the retail division of SATHOSA started reducing its work force via a voluntary retirement scheme. The VRS was offered when a 40% stake and management control of the SATHOSA retail unit was sold to the local consortium for 650 million Sri Lankan rupees ($1=LKR96.90) in July 2002. More over 100 casual employees were terminated on the pretext of over staffing and a similar number was appointed from RK’s electorate. Even illiterate drug addicts were appointed to the casual vacancies.
The IGA consortium miscalculated the political situation when Chandrika Kumaratunga led government came to power in 2004. Jeyaraj Fernandopulle was appointed Minister.
There was a necessity to probe the institution during the period RK was the Minister. RK would have been found out much earlier in 2004 long before the Penthouse deal. The new Minister Jeyaraj Fernandopulle disregarded it. It was believed by some, that RK and Jeyaraj were buddies though they belonged to different camps. “Birds of feather get together”.
The Directors of SATHOSA retail were giving excuses. The first excuse was the government’s failure to raise of Rs 150 million. The second was full control. They resigned claiming these demands were not met. The real reason is lack of any experience in doing the job.
All distribution of staple foods needed by the poor segments of the market went haywire under the management of IGA. The orders placed for goods far exceeded the requirements. Transport was erratic. Once, a lorry was sent to Kalutara retail unit with a full load of requirements and then went to Negombo unit with only two bags ofB’onions. Around 750 cases of “Sustagen” powder was laying at Buttala shop, a faraway area where poor customers are a majority. They go for lesser priced local substitutes A tin of “Sustagen” was over Rs. 1000/-. It is pertinent to note that even one of the share holding companies Ceylon Biscuits Ltd had to take back their confectionary products worth over one million rupees at that time. The new purchasing manager had no idea of market segments; re-order levels and re- order quantities. Distribution was in chaos. It was too late when IGA realized this chaos within one and a half years. The contract with LOGIVIS was terminated. As a result of these grave miscalculations through ignorance, the average turnover was below Rs. 300 million for the first six months. Conversely purchases under the new management showed 1.5 Billion. This quantity could cover entire six months operation
The Chairman’s post vacated by NW was succeeded by Deputy Chairman Lal Wickrematunge the elder brother of Lasantha Wickrematunge. Lal was a balanced man who listened to the officers and wanted to continue the good work carried out by NW.
RK’s policy of appointing his cronies as Heads of some divisions such as retail marketing, security and other divisions discouraged CWE executive staff. Most held masters or diplomas in their chosen field and were trained abroad. Under these circumstances the performance deteriorated. The SATHOSA retail division with 150 shops was earning a gross margin of 14% when RK took over. It started making losses within a few months after RK becoming minister in charge.
Another folly RK committed was to order shops all over the country to be kept open for 24 hours, making it impossible for the staff to work. Breast feeding mothers brought their infants to the shops as they had to feed the babies. The infants slept while mosquitos and other insect harassed the Babies. The electricity bills and overtime costs doubled. However much the staff tried to explain this to RK, he did not heed. In areas like Bibile where people go to bed early there were no customers after 8o’clock.
Around 2,860 employees out of a total 6,760 accepted the voluntary retirement scheme (VRS). Separately, the government’s privatization arm, the Public Enterprise Reform Commission said 17 parties have submitted bids to purchase several properties belonging to the CWE. The total value of the properties isn’t known.
A leading private sector supermarket chain made a bid to take over the shops but they were not selected. They have over 500 outlets now and a leading promoter of agribusiness, selling vegetables and fruits at very competitive prices.
Extract from RK’S statement:
“I joined politics after working with former Minister Lalith Athulathmudali, who, too, was accused wrongly by his opponents. He was described as a person who swallowed ships. I was a successful businessman before I joined politics. During my career I never earned anything through illegal means. I only lost my money because of politics. I never earned anything from politics.”
Lalith Athulathmudali the Oxford University and Harward scholar’s name is used to claim RK as his prodigy. Rk cannot hold a candle to Lalith. He was a presidential hope and would have been the savior of this country if not for his murder by the LTTE. RK was not much known while Lilith was the minister of trade. That was the peak of SATHOSA performance. The food distribution during communal riots 1983 was credited to Lalith, Chairman Zarook and his team of officers. They knew how to lead and delegate responsibility and backing the decisions.
Late Kingsly Wickramaratne, the Trade Minister did more service to Lalith’s “Mahapola” concept than RK. He handed over the land belonging to the “Mahapola” trust fund to locate Sri Lanka Institute of Information Technology at Kaduwela. SLITT is the leading institution in IT education.
A key officer has fallen in to a mess allegedly carrying out orders to sell a good quality stock of rice as poor quality to a buyer known to RK at a lower price. The bribery case is now sub-judice. Therefore no further comment can be made.
RK ends his statement by quoting Dhammapada.
I too would end this essay by quoting a stanza from the same source.
ThanhayaWippamutthassa, Nathti Shoko Kuthobhayan”
“From greed arises grief, from greed arises fear, for him who is free of greed, there is no greed no grief.”
*Upali Cooray, Former General Manager (SATHOSA)