Parliamentary Series No……. of The Seventh Parliament of The Democratic Socialist Republic of Sri Lanka (First Session) Second Report From The Committee on Public Enterprises Presented by Hon. DEW. Gunasekara Chairman of the Committee on 23rd of July, 2013 REPORT FROM THE COMMITTEE ON PUBLIC ENTERPRISES OF THE PARLIAMENT OF THE DEMOCRATIC SOCIALIST REPUBLIC OF SRI LANKA Honourable Members of the Committee on Public Enterprises First Session of the Seventh Parliament 01 Hon.DEW Gunasekara (Chairman) 02 Hon.(Mrs.) Pavithra Devi Wanniarachchi 03 Hon.A.D.Susil Premajayantha 04 Hon.(Dr.) Rajitha Senaratne 05 Hon. Chandrasiri Gajadeera 06 Hon. A.P.Jagath Pushpakumara 07 Hon. T.B.Ekanayake 08 Hon.Mahinda Amaraweera 09 Hon.S.M.Chandrasena 10 Hon. (Dr.) Mervyn Silva 11 Hon. Lasantha Alagiyawanna 12 Hon. Sarana Gunawardena 13 Hon. Weerakumara Dissanayake 14 Hon. Lakshman Kiriella 15 Hon. Karu Jayasuriya 16 Hon. Ravi Karunanayake 17 Hon. (Al Haj) A.H.M.Azwer 18 Hon. Sajith Premadasa 19 Hon. Sunil Handunnetti 20 Hon. Arjuna Ranatunga 21 Hon. M.T.Hasen Ali 22 Hon. A.Vinayagamoorthy 23 Hon. Dayasiri Jayasekara 24 Hon. (Ven.) Athuraliye Rathana Thero 25 Hon. Seeniththamby Yoheswaran 26 Hon. Namal Rajapaksa 27 Hon. Eran Wickramaratne 28 Hon. (Prof.) Rajiva Wijesinha 29 Hon. E.Saravanapavan 30 Hon. Sujeewa Senasinghe 31 Hon. (Mrs.) Rosy Senanayake i PARLIAMENTARY SERIES NO………... Composition of the Sub Committee I of the Committee on Public Enterprises. 01. Hon. A.D.Susil Premajayantha (Chairman) 02. Hon. (Mrs) Pavithra Devi Wanniarachchi 03. Hon. (Dr.) Rajitha Senarathna 04. Hon. Chandrasiri Gajadeera 05. Hon. T.B.Ekanayake 06. Hon. Mahinda Amaraweera 07. Hon. Lakshman Kiriella 08. Hon. Ravi Karunanayake 09. Hon. Dayasiri Jayasekara 10. Hon. Sujeewa Senasinghe Composition of the Sub Committee II of the Committee on Public Enterprises. 01. Hon. Karu Jayasuriya (Chairman) 02. Hon. A.P.Jagath Pushpakumara 03. Hon. S.M.Chandrasena 04. Hon. (Dr.) Mervyn Silva 05. Hon. Sarana Gunawardene 06. Hon. Weerakumara Dissanayake 07. Hon. (Al-Haj) A.H.M.Azwer 08. Hon. Sajith Premadasa 09. Hon. Sunil Handunnetti 10. Hon. Namal Rajapaksa ii REPORT FROM THE COMMITTEE ON PUBLIC ENTERPRISES OF THE PARLIAMENT OF THE DEMOCRATIC SOCIALIST REPUBLIC OF SRI LANKA Composition of the Sub Committee III of the Committee on Public Enterprises. 01. Hon. Lasantha Alagiyawanna (Chairman) 02. Hon. Arjuna Ranatunga 03. Hon. M.T. Hasen Ali 04. Hon. A. Vinayagamoorthy 05. Hon. (Ven.) Athuraliye Rathana Thero 06. Hon. Seeniththamby Yoheswaran 07. Hon. Eran Wickramaratne 08. Hon. (Prof.) Rajiva Wijesinha 09. Hon. E. Saravanapavan 10. Hon. (Mrs.) Rosy Senanayake COPE Secretariat 01 M.N.Peiris ,Asst. Director (Admin) 02 Indrani Senarathne (Principal Officer-upto 31.03.2013) 03 A.C.P.Suriyapperuma (Principal Officer-from 01.04.2013) 04 Jagath Wickramasinghe (Deputy Principal Officer) 05 Ranjith Fernando (Asst. Principal Officer) 06 Umanga Panditha (Asst. Principal Officer) 07 W.G.S.Shantha (Parliamentary Officer) 08 Prabha Thilakarathne (Parliamentary Officer) 09 M.A.K.D.C.Kumara (Parliamentary Officer) iii PARLIAMENTARY SERIES NO………... Contents List of Tables xii Chairman’s Note 1 Preface 2 General Observations /Recommendations 4 Report on the cases referred to the Commission to investigate alle- 13 gations of Bribery or Corruption Increasing the Effectiveness of COPE 13 Financial Status of the Examined Institutions 16 Institutions Offered with Unfavourable Audit Opinions 34 Appendixes » Appendix A:Issues Discussed by the Main Committee * Atomic Energy Authority 39 * State Timber Corporation 39 * National Savings Bank 40 * Associated Newspapers Company Ltd. 42 * Central Engineering Consultancy Bureau 44 * Employees’ Trust Fund Board 45 * National Lotteries Board 46 * Insurance Board of Sri Lanka 51 * Board of Investment 52 * Sri Lanka Ports Authority 54 * Ceylon Petroleum Corporation 57 * Ceylon Electricity Board 59 * Ceylon Shipping Corporation Ltd. 61 * Road Development Authority 61 * Sri Lanka Tourism Development Authority 63 * Sri Lanka Land Reclamation & Development Corporation 67 * Regional Development Bank 70 * Bank of Ceylon 71 iv REPORT FROM THE COMMITTEE ON PUBLIC ENTERPRISES OF THE PARLIAMENT OF THE DEMOCRATIC SOCIALIST REPUBLIC OF SRI LANKA * National Housing Development Authority 74 * State Engineering Corporation 75 * Mihin Lanka Ltd. 79 * Sri Lanka Broadcasting Corporation 81 * Housing Development Finance Corporation Bank (HDFC) 83 * ITN & Lakhanda Radio 84 * Sri Lanka Transport Board 85 * Lanka Sathosa Ltd. 86 * Development Lotteries Board 87 * Janatha Estate Development Board 88 * Local Loans Development Fund 89 * National Enterprise Development Authority 91 * Sri Lanka Export Credit Insurance Corporation 91 * Mahapola Higher Education ScholarshipTrust Fund 92 * National Paper Company Ltd. 94 * National Institute of Cooperative Development 96 * B.C.C.Lanka Ltd. 99 * Elkaduwa Plantations Ltd. 100 * Hingurana Sugar Industries Ltd. 100 * Ceylon Fertilizer Company Ltd. 101 * Janatha Fertilizer Enterprise Ltd. 103 * Kahatagaha Graphite Lanka Ltd. 103 * Mantai Salt Ltd. 104 * North Sea Ltd. 105 * Thurusaviya Fund 106 * Kalubovitiyana Tea Factory Ltd. 107 * Sri Lanka Rubber Manufacturing Export Corporation Ltd. 109 * Kantale Sugar Industries Ltd. 110 * Lanka Salusala Ltd. 111 * STC General Trading Company Ltd. 111 v PARLIAMENTARY SERIES NO………... * Sri Lankan Airlines Ltd. 112 * Chilaw Plantations Ltd. 113 * Kurunegala Plantations Ltd. 115 * Central Cultural Fund 116 * Cey-Nor Foundation Ltd. 119 * Lanka Mineral Sands Ltd. 121 * Skills Development Fund Ltd. 122 * Paranthan Chemicals Ltd. 123 * Sir John Kotalawala Defence University 125 * National Dangerous Drugs Control Board 127 * Rakna Arakshana Lanka Ltd. 129 * Lanka Logistics Ltd. 129 * Milk Industries of Lanka Ltd. (MILCO) 130 * Lady Lochore Loan Fund 132 * Sri Lanka Savings Bank Ltd. 134 * National Insurance Trust Fund 135 * State Pharmaceuticals Corporation 138 * Lakdiva Engineering Co. Ltd. 142 * Distance Learning Centre Ltd. 143 * Cooperative Wholesale Establishment 145 * State Trading (COOP) Wholesale Co. Ltd. 148 * Provident Fund for Buddhist & Pali University 150 * Universities Pension Fund & Provident Fund 151 * Eastern University 152 * Botanical Garden Trust Fund 155 * Lanka Phosphate Ltd. 157 * National Water Supply &Drainage Board 160 * Agriculture & Agrarian Insurance Board 162 * State Pharmaceuticals Manufacturing Corporation 164 * Securities & Exchange Commission 166 vi REPORT FROM THE COMMITTEE ON PUBLIC ENTERPRISES OF THE PARLIAMENT OF THE DEMOCRATIC SOCIALIST REPUBLIC OF SRI LANKA » Appendix B: Issues Discussed by the Sub Committee - I * Institute of Indigenous Medicine 171 * Open University 172 * Post graduate Institute of English 174 * National Institute of Education 174 * SL Press Council 175 * Tower Hall Theater Foundation 176 * National Youth Services Council 178 * SL Institute of Development Administration 180 * Post graduate Institute of Archeology 181 * University of Colombo School of Computing 181 * University of Visual & Performing Arts 182 * Institute of Policy Studies 183 * National Human Resources Development Council 184 * Official Languages Commission 185 * Sri Lanka Bureau of Foreign Employment 185 * Tertiary & Vocational Education Commission 186 * National Institute of Library & Information Science 186 * National Institute of Business Management 188 * Postgraduate Institute of Medicine 189 * University of Kelaniya 190 * Buddhist & Pali University 192 * Institute of Human Resources Advancement 194 * Institute of Technology-University of Moratuwa 194 * University of Moratuwa 195 * J.R. Jayawardena Cultural Centre 196 * National Institute of Language Education & Training 198 * Sri Lanka Foundation 199 * South Eastern University 200 * Swami Vipulananda Institute of Aesthetic Studies 201 * University of Jaffna 202 vii PARLIAMENTARY SERIES NO………... * Uva Wellassa University 205 * Sri Lanka Institute of Advanced Tech. Education 205 * University of Colombo 206 * Rajarata University of Sri Lanka 206 * University of Ruhuna 206 * National Apprt. & Industrial Training Authority 207 * Selacine Television Institute 207 * University of Vocational Technology 208 * Vocational Training Authority 208 * Buddasravaka Bikkhu University of Sri Lanka 209 * Post Grad. Institute of Pali & Buddhist Studies 210 * University of Peradeniya 210 * Wayamba University 210 * University of Sabaragamuwa 211 * University of Sri Jayawardenapura 212 * Sugathadasa National Sports Complex Authority 213 * Sri Lanka Institute of Fundamental Studies 213 * Saumyamoorthi Thondaman Memorial Foundation 214 * Galle Heritage Foundation 214 * Institute of Biochemistry Molecular Biology & Biotechnology 215 * Post Graduate Institute of Agriculture 215 * Post Graduate Institute of Science 215 * National Centre for Advanced Studies in Humanities and So- 216 cial Sciences * SL Institute of Local Governance 216 * Information & Communication Technology Agency 216 » Appendix C: Issues Discussed by the Sub Committee - II * Coconut Cultivation Board 219 * Land Survey Council 219 * Colombo Commercial Fertilizer Com. Ltd. 220 * Hector Kobbekaduwa Agrarian Research & Training Institute 221 viii REPORT FROM THE COMMITTEE ON PUBLIC ENTERPRISES OF THE PARLIAMENT OF THE DEMOCRATIC SOCIALIST REPUBLIC OF SRI LANKA * National Aquatic Resources Research & Development Agency 222 * Udarata Development Authority 224 * National Institute of Fisheries & Nautical Engineering 225 * Palmyra Development Board 226 * National Institute of Plantation Management