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Parliamentary Series No 343 Parliamentary Series No 343 of The Seventh Parliament of The Democratic Socialist Republic of Sri Lanka (First Session) SECOND INTERIM REPORT (for the period from 07th of May 2014 to 26th of September 2014) From The Committee on Public Enterprises Presented by Hon. DEW.Gunasekara Chairman of the Committee On 14th of November, 2014 Ordered by Parliament of Sri Lanka to be printed on th 14 of November, 2014 Parliamentary Series No 343 ii Report from the Committee on Public Enterprises of the Parliament of the Democratic Socialist Republic of Sri Lanka Members of the Committee on Public Enterprises First Session of the Seventh Parliament 1. Hon.DEW Gunasekara (Chairman) 2. Hon.(Mrs.) Pavithra Devi Wanniarachchi 3. Hon.A.D.Susil Premajayantha 4. Hon.(Dr.) Rajitha Senaratne 5. Hon. Chandrasiri Gajadeera 6. Hon. A.P.Jagath Pushpakumara 7. Hon. T.B.Ekanayake 8. Hon.Mahinda Amaraweera 9. Hon.S.M.Chandrasena 10. Hon. (Dr.) Mervyn Silva 11. Hon. Lasantha Alagiyawanna 12. Hon. Weerakumara Dissanayake 13. Hon. Sarana Gunawardena 14. Hon. Lakshman Kiriella 15. Hon. Karu Jayasuriya 16. Hon. Ravi Karunanayake 17. Hon. (Al Haj) A.H.M.Azwer 18. Hon. P.Harrison (from 24.09.2014) 19. Hon. Sajith Premadasa 20. Hon. Sunil Handunnetti 21. Hon. Arjuna Ranatunga 22. Hon. M.T.Hasen Ali 23. Hon. A.Vinayagamoorthy 24. Hon. Harin Fernando (up to 05.08.2014) 25. Hon. (Ven.) Athuraliye Rathana Thero 26. Hon. Seeniththamby Yoheswaran 27. Hon. Namal Rajapaksa 28. Hon. Eran Wickramaratne 29. Hon. (Prof.) Rajiva Wijesinha 30. Hon. E.Saravanapavan 31. Hon. Sujeewa Senasinghe 32. Hon. (Mrs.) Rosy Senanayake i Parliamentary Series No 343 Composition of the Sub Committee I of the Committee on Public Enterprises. 1. Hon. A.D.Susil Premajayantha (Chairman) 2. Hon. (Mrs) Pavithra Devi Wanniarachchi 3. Hon. (Dr.) Rajitha Senarathna 4. Hon. Chandrasiri Gajadeera 5. Hon. T.B.Ekanayake 6. Hon. Mahinda Amaraweera 7. Hon. Lakshman Kiriella 8. Hon. Ravi Karunanayake 9. Hon. P.Harrison (from 24.09.2014) 10. Hon. Harin Fernando (up to 05.08.2014) 11. Hon. Sujeewa Senasinghe Composition of the Sub Committee II of the Committee on Public Enterprises. 1. Hon. Karu Jayasuriya (Chairman) 2. Hon. A.P.Jagath Pushpakumara 3. Hon. S.M.Chandrasena 4. Hon. (Dr.) Mervyn Silva 5. Hon. Sarana Gunawardene 6. Hon. Weerakumara Dissanayake 7. Hon. (Al-Haj) A.H.M.Azwer 8. Hon. Sajith Premadasa 9. Hon. Sunil Handunnetti 10. Hon. Namal Rajapaksa Composition of the Sub Committee III of the Committee on Public Enterprises. 1. Hon. Lasantha Alagiyawanna (Chairman) 2. Hon. Arjuna Ranatunga 3. Hon. M.T. Hasen Ali 4. Hon. A. Vinayagamoorthy 5. Hon. (Ven.) Athuraliye Rathana Thero 6. Hon. Seeniththamby Yoheswaran 7. Hon. Eran Wickramaratne 8. Hon. (Prof.) Rajiva Wijesinha 9. Hon. E. Saravanapavan 10. Hon. (Mrs.) Rosy Senanayake ii Report from the Committee on Public Enterprises of the Parliament of the Democratic Socialist Republic of Sri Lanka Composition of the Follow-Up Committee of the Committee on Public Enterprises. 1. Hon. Mahinda Amaraweera (Chairman) 2. Hon. Eran Wickramaratne 3. Hon. (Prof.) Rajiva Wijesinha iii Parliamentary Series No 343 iv Report from the Committee on Public Enterprises of the Parliament of the Democratic Socialist Republic of Sri Lanka Contents Chairman’s Note………………………………………... …………………. vii Preface…………………………………………………… …………………. ix History at a Glance……………………………………... …………………. xi Introduction…………………………………………….. …………………. 1 Major Transactions with Inadequate Accountability …………………. 3 General Observations………………………………….. …………………. 7 Recommendations……………………………………… …………………. 13 Financial Status of the Examined Institutions……….. …………………. 15 Status of Presenting Annual Reports to Parliament…. …………………. 19 Auditor’s Opinion on Annual Accounts………………. …………………. 21 Institutions Examined by the Main Committee………. …………………. 25 Central Bank of Sri Lanka…………………………... …………………. 27 Ceylon Petroleum Corporation ……………………... …………………. 27 Sri Lanka Institute of Advanced Technological Education …………....... 29 Agriculture & Agrarian Insurance Board…………… …………………. 30 Sri Lanka State Plantation Corporation……………... …………………. 31 Ceylon Electricity Board……………………………. …………………. 32 Sri Lanka Ports Authority…………………………… …………………. 34 University of Sabaragamuwa………………………... …………………. 36 Sri Lanka Bureau of Foreign Employment …………. …………………. 36 Lanka Sathosa Ltd. ……………………..................... …………………. 37 State Printing Corporation…....................................... …………………. 38 Ceylon Petroleum Storage & Terminals Limited…… …………………. 39 National Water Supply & Drainage Board ................. …………………. 40 Central Engineering Consultancy Bureau ….............. …………………. 41 National Film Corporation…....................................... …………………. 42 Milk Industries of Lanka Ltd. (MILCO) …................ …………………. 43 University provident Fund & Pension Fund…............ …………………. 44 Sri Lankan Airlines Ltd. …......................................... …………………. 45 National Paper Company Ltd. …................................ …………………. 46 Road Development Authority …................................. …………………. 48 v Parliamentary Series No 343 Sri Lanka Cement Corporation…................................ …………………. 50 Central Environmental Authority…............................ …………………. 52 Sri Lanka Cricket…..................................................... …………………. 52 Sri Lanka Institute of Tourism & Hotel Management …………………. 53 University of Jaffna….....................…........................ …………………. 54 Institutions Examined by the Sub Committee - I…...... …………………. 57 Sri Lanka Ayrvedic Drugs Corporation……………... …………………. 59 Institute of Indigenous Medicine……………………. …………………. 59 National Institute of Library & Information Sciences. …………………. 60 Institute of Technology-University of Moratuwa…… …………………. 61 National Human Resources Development Council…. …………………. 62 Vocational Training Authority…................................ …………………. 63 Institutions Examined by the Sub Committee – II…… …………………. 65 Selacine Television Institute …................................... …………………. 67 Sri Lanka Press Council….....................…................. …………………. 69 Institute of Post-Harvest Technology…..................... …………………. 70 Sri Lanka Freedom from Hunger Campaign Board… …………………. 71 Condominium Management Authority….................... …………………. 72 Urban Settlement Development Authority….............. …………………. 72 Coconut Research Board….....................…................ …………………. 73 Institutions Examined by the Sub Committee - III…... …………………. 75 National Institute of Social Development…............... …………………. 77 National Secretariat for Persons with Disabilities…... …………………. 78 Colombo Commercial Fertilizer Company Ltd. ….... …………………. 79 Public Utilities Commission….....................…........... …………………. 80 Sri Lanka Inventors Commission…............................ …………………. 81 Sri Lanka Accreditation Board for Conformity Assessment….....................…...................................... …………………. 82 Marine Environment Protection Authority….............. …………………. 82 Gem & Jewellery Research & Training Institute…..... …………………. 83 * Index……………………………………………….... …………………. 87 vi Report from the Committee on Public Enterprises of the Parliament of the Democratic Socialist Republic of Sri Lanka Chairman’s Note In keeping with my pledge, I hereby present to the House the Second Interim Report of the Committee on Public Enterprises which covers its activities for the period from May-September, 2014. Hitherto, the Committee on Public Enterprises has presented to the Parliament four Reports (2 Final Reports and 2 Interim Reports). The Sixth Report or the Third Final Report will be presented towards the end of 2014. During the course of the First session of the Seventh Parliament (commencing from 2010), the COPE has been able to examine the audited accounts relating to all institutions coming under the COPE thrice within a period of 04 years. This is an unprecedented record in the history of our legislature. The need for a separate oversight Committee as the Committee on Public Enterprises arose in consequence of the expansion of the Public Sector of the Sri Lankan economy. All institutions other than the Ministries and Government Departments come under the purview of the COPE (244 Institutions). On a directive by the Committee, the State-owned companies registered under the Company Law have also been brought under scrutiny by the COPE. Even the companies which have a fair percentage of state capital come under the COPE’s overview. Despite a heavy load of work assigned to it and with ever increasing volume of work, the COPE has been able to accomplish its constitutional task smoothly, earning the admiration of the people. The prestige of the COPE has been enhanced appreciably nationally as well as internationally. Several Parliaments of our sister nations have sought our co- operation with regard to their oversight Committees. I take this opportunity to reiterate our persistent demand for amendments to the Standing Orders in order to strengthen the COPE’s authority and capacity. I believe that the COPE has been able to contribute appreciably towards the enhancement of good governance in so far as Public control of Finance is concerned. The COPE owes its deep appreciation of the high quality performance of its staff. The co-operation extended by the Auditor General’s Department, the Department of Public Enterprises and the Department of National Budget of the General Treasury
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