P.B. Jayasundara Saga and Triangle of Corruption: politicians, bureaucrat and businessmen

2 Aug 2008

The Supreme Court order against Treasury Secretary Dr. P.B. Jayasundara to pay Rs. 500,000, the highest ever compensation in a fundamental rights case, has paved the way for another dimension in fight against corruption in Sri lanka. The popular myth spread in Sri Lankan society is that it is politics that is corrupt. But the Supreme Court ruling has clearly exposed all three corners of “Triangle of Corruption” in Sri Lankan society, namely politicians, bureaucracy and Businessmen/multi-national companies.

The Supreme Court petition was filed by Presidential Advisor Vasudeva Nanayakkara in January this year as a private citizen against the highly controversial deal surrounding the LMSL privatization. The case dates back to 2002 following a privatization deal that led to the sale of Lanka Marine Service (Pvt) Limited (LMS) by state-owned Ceylon Petroleum Corporation (CPC) to Sri Lankan conglomerate John Keells Holdings PLC (JKH).

The SC ruled that as then PERC Chairman, Dr. P.B. Jayasundara and Executive Director of JKH Susantha Ratnayake had acted with dishonest intent in the sale of LMSL shares. The Supreme Court ordered Treasury Secretary Dr. P.B. Jayasundara to pay Rs. 500,000, the highest ever compensation in a fundamental rights case. The Supreme Court also ordered that Lanka Marine Services which is under John Keells Holdings (JKH), which was privatized in 2002, be handed over to the government and ordered that the occupiers of the 8.5-acre plot of land should vacate it within one month

The corruption in bureaucracy
The corruption in public sector is deep rooted cancer in Sri Lanka. It is seen everywhere from Police stations to schools and from peon to ministerial secretaries. The SC rule state that P.B. Jayasundera has made certain significant deviations from that stated at the Pre bid Conference that favored JKH. In particular after the bid was accepted Jayasundera agreed to the inclusion of a clause in the CUF Agreement on the basis of which LMSL owned by JKH attempted to stave off competition in the supply of bunkers by others who subsequently obtained licenses from the Minister. The clause agreed to by Jayasundera was struck down by the Court of Appeal as being illegal. Regardless of the position the culprit must be punished and now it is time to act up on SC ruling.

The corruption in private sector
In the SC ruling, it has revealed that JKH had made a false representation of collaboration with Fuel and Marine Market (FAMM) for the purpose of securing the 70 marks to be short listed. This falsity is established by a contemporaneous application made by JKH to the Board of Investment (BOI) for investment relief in which no reference is made to any foreign collaborator.

The tax relief granted to JKH was not permissible under the existing regulations and JKH got an amendment tailor-made for its purpose and secured the tax exemption. This resulted in LMSL which was a tax paying company when owned by the CPC becoming a tax free company when sold to JKH.

Just as much as the politicians are corrupt, so is certain segment in business community. At most times, if the corporates don’t give the money, the politicians won’t be corrupt. The multinational companies in most of the cases try to prtend like clean and fair entities. But in reality those companies are merely going after money and more corrupt than politicians and public sector.

It is evident that the directors of JKH should not only be held accountable, but taken to criminal court and given strict punishment like in Singapore, Japan and China. “There needs to be strict indicators (regulations) given after this so that the business community (together) with high public officials do not rob peoples’ money”. That is why multi national business community always tries to elect politicians and parties that can be danced to their tune. They are spending Billions of Rupees for the political parties which are favoring their agenda rather than interest of the ordinary people of the country.

The corruption in Politics
The petition names more than 30 respondents including Board of Investment (BOI) Chairman Dhammika Perera, former BOI Chairman Arjuna Mahendran, Commissioner General of the Inland Revenue A.A. Wijepala, John Keells Holdings Ltd and its current chairman Susantha Ratnayake, former Minister of Enterprise Development G.L. Peiris and the Attorney General.

In another development, it is reported that the Bribery Commission is looking into the possibility of filing action against Dr. Jayasundara, Ministers Milinda Moragoda (PERC was under him) and Karu Jayasuriya (CPC was under him) on the charge of abusing public property in connection with this deal.

Unfortunately, it is only one of the culprits namely Dr. P.B. Jayasundara that has been punished so far while all the politicians involved in the fraud are still freely doing their business. Different political parties and politicians have responded to the SC ruling in different manner.

Jathika Hela Urumaya (JHU) is reported to have influenced President Mahinda Rajapaksa to accept the resignation letter of the Treasury Secretary, Dr. P.B. Jayasundara. “He is punished by the Supreme Court and needs to be evicted from such high caliber positions,” JHU was quoted. Marxist Janatha Vimukthi Peramuna party also insisted that Jayasundara should resign from his post.

In the meantime, it is reported that Fisheries Minister Felix Perera has offered to pay the Rs. 500,000 fine imposed on Treasury Chief Dr. P. B. Jayasundera by the Supreme Court. He has said that it is unfair to sling mud at officials who could not reply the charges leveled against them in Parliament. Most of the officials are honest officials and I do not mind paying the Rs. 500,000 fine imposed on Treasury Secretary Dr. P. B. Jayasundara Minister of Fisheries Felix Perera said in Parliament on 24th July.

In a political column in Lakbima Sunday News Paper (Aug 02) which is written by UNP Chief Organizer S. B. Dissanayaka has tried his best to justify that this sort of under arm deals are common in Open economy and the ruling should not be considered as a big issue.

All and all, the corrupt politicians, bureaucracy and businessmen are rallying in one side defending each other.If we really need to eradicate corruption and make just society, all the culprits behind frauds must be punished to the maximum. It is only the judiciary that has power to punish corrupt burocracy and businessmen. But we all as voters have the power of the vote to defeat every single corrupt politician in up coming elections. That is why it is very important for the people of the country and judiciary system to collectively play active role to eradicate corruption from our mother land.

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ViceUnVersa said...

I think this is a good lesson to all public servants. PB was appointed politically, he survived Madam, then Ranil and moved up with Mahinda.
All he did was what he was bided to by those in power. What he sadly forgot was that he is an appointee, not an elected official by the people through a democratic process. Now he will fade into nothing but wilderness. Was the promise and power of being the Secretary to the Treasury that intoxicating? He was one of the most powerful men in Sri Lanka during Madam's regime.
He didn't make money through any of her and her cronies deals; the SriLankan/Emirates deal coming to top of mind.
Further the bus privatisation deal when Ranil was in power and PB was at PERC, he just did what he was bided.
The examples are endless.
I pity him for his greed for power, now cumulating to nothing.
Sir, at least now it is time to go, with whatever that's left of your dignity.


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