Rs. 200 Million Spent, No Privatizations — Why a parliamentary Audit is needed?
By Adolf
In the Interim Budget 2022, the Government of Sri Lanka announced the creation of a State-Owned Enterprise (SOE) Restructuring Unit within the Ministry of Finance, Economic Stabilization and National Policies, with an allocation of Rs. 200 million to oversee reforms of major loss-making state corporations such as SriLankan Airlines, the Ceylon Electricity Board (CEB) and the Ceylon Petroleum Corporation (CPC). The aim, as presented by the Presidency and Treasury, was to strengthen financial performance and reduce the fiscal burden from persistent SOE losses.
The unit was led by Suresh Kumar Shah, a chartered accountant and a controversial private sector leader, appointed to head restructuring efforts. Despite this high-level commitment and public expectations that at least some responsible enterprises would either be privatized or meaningfully reformed during the two-year period, no major privatization has taken place to date. There have been debates around strategic reforms and closures, but no successful divestment of significant SOEs has been completed.
Auditor General Report
In fact, the Auditor General’s 2024 report on the Ministry’s finances provides new insight into how the allocated funds were actually spent. According to the audit findings, a total of Rs. 121 million was spent on operating the SOE Restructuring Unit in 2023 and 2024, with nearly half (Rs. 58 million) going to salaries within the unit. A portion — about Rs. 193 million (over multiple years) — was also paid to two foreign transaction consultants contracted to assist in the restructuring process. What the audit was clear about was that by the end of 2024, the core objectives of the restructuring program had not been achieved, and the unit’s activities had been temporarily suspended in early 2025, with no clear deliverables completed.
Tax Payers Money
Critics point to these facts and argue that taxpayer money was squandered on administrative costs, consultants, and advertising, without generating meaningful outcomes such as successful privatizations or improved SOE performance. Many commentators on social media and in public debates have questioned why millions were spent while state enterprises continue to weigh heavily on the national finances and ongoing fiscal reforms.
Expenditure
This expenditure stands in sharp contrast to ongoing high-profile probes into smaller procurement issues, such as the case involving a former Water Board General Manager and a former president over vehicle hire spending in the UK — cases where individuals have faced legal scrutiny and arrests. Public sentiment is now asking: Why is there silence on an institutional expenditure that arguably had larger fiscal implications than these individual cases?
Economists argue that SOE reform is a vital part of any credible fiscal recovery strategy. Advocates for divestiture note that Sri Lanka’s SOEs have long accumulated losses and consumed public resources that could otherwise go toward social priorities, infrastructure and debt reduction.
Parliamentary Audit
Given this backdrop, a full parliamentary audit of the SOE Restructuring Unit’s budget, contracts, and outcomes is increasingly being demanded by civil society, taxpayers and political watchdogs. A transparent investigation — reviewing the full two years of operations, contract awards, fees paid to consultants and the actual outcomes achieved — could restore public confidence in reforms and ensure that future state restructuring efforts avoid similar waste. LNW will investigate the performance of the UNIT and how the leadership spent money and the need for accountability .
The post Rs. 200 Million Spent, No Privatizations — Why a parliamentary Audit is needed? appeared first on LNW Lanka News Web.
