Employees, trade unions insist on transparency in privatisation process – Suresh Shah

The public, employees and most importantly trade unions are looking at privatisation of State Owned Enterprises (SOE) more positively, said State-Owned Enterprise Restructuring Head Suresh Shah,

Currently, over 400 SOEs are operating in several key sectors including power, energy, finance & insurance, water, aviation, health and education, among others. “Out of them are around 50 to 60 SOE’s which are unproductive and could be completely wound up,” at the panel discussion hosted by CFA Society of Sri Lanka at, Shangri-La, Colombo on Friday.

“The opposition and the violent protests that we saw two three years ago against privatisation of SOEs have now died down. This is because they have realised that by divesting SOE their employees could get better returns and the country’s economy too would improve, irradiating the possibility of facing an economic crisis again.”

Shah said that what the employees and trade unions say to us is that privatisation should be done transparently and they also call to get ‘good investors’ who will genuinely improve their institution.

“We will maintain transparency at all times and are a series of steps that are taken in this regard.”

The unions and employees in the identified SOEs to be divested want an assurance that their employment would be secure if and when the management changes and this aspect is done.

He also said that the idea of divesting SOEs was not only to bring revenue to the government. “We want the identified SOEs to be more efficient and profitable via the involvement of the new investors.”

Hatton National Bank Managing Director, Chief Executive Officer Jonathan Alles said that he was against the common slogan ‘Banks must write off long-standing loans of some of the SME sectors’ as it creates a bad precedent for society.

“If this is done these segments will get used to default.”

He also said that they welcome how local debt restricting (DDO) was done without hurting the banking sector.

Alles said that today people seem to have forgotten all the issues they faced and are going back to their old-fashioned high-spending patterns and trying to live on borrowed money.

“Today some companies prepare three balance sheets, one for the investors and one for tax collectors and so on and they should be more responsible towards the society and pay the due taxes.”

Governor Central Bank, Dr. Nandalal Weerasinghe said that there was no need to have a second DDO as the current process is very focused and strong.

“However if the DDO proposals are not allowed to function smoothly a second DDO may have to be introduced,” he cautioned.