Cabinet allocates Rs.75Bn to settle ’Red bills’ of former Govt.

The cabinet gave the nod on Wednesday (18) to allocate a massive Rs. 75 billion to settle unpaid bills of the Yahapalana government to small and middle-level development projects, fertiliser companies, banks and many other investors, goods and services suppliers, cabinet spokesman, Minister Bandula Gunawardana said yesterday.

Addressing the weekly cabinet news briefing, Minister, Gunawardana said the cabinet gave approval to pay Rs. 10 billion immediately to drug companies for outstanding bills that remained payable by the Ministry of Health for drugs purchased on credit in 2018 and 2019, Rs. 3 billion to two fertiliser companies, Commercial Company and Lakpohora, Rs. 5 billion for small and medium scale constructors who built school buildings and renovated roads, Rs. 46 billion to banks to settle the subsidies payable by the Treasury to pay a 15% interest rate to senior citizens for their fixed deposits.

“With the settlement of outstanding bills of these private and state establishments, there will be an increased circulation of money that would boost the purchasing power of the people. In addition to that, the drug companies will be in a position to re-open Letters of Credit to import essential drugs, fertiliser companies can import fertiliser and development project managements will pay salaries of their workers,” Minister Gunawardana said.

He said the approval of these funds was made possible after President Gotabaya Rajapaksa was empowered by the Constitution to obtain funds from the consolidated fund after the dissolution of Parliament and the Treasury Secretary as the chief financial officer of the state will obtain the money from the Treasury to allocate funds to each establishment, next week.

Small scale entrepreneurs, investors and businessmen who are in the red will be offered a bank loan to re-start their business at an interest rate of 4% and a grace period of six months will be offered to those who have defaulted debt repayments.

The cabinet has also approved Rs. 500 million for the COVID-19 prevention campaign and Rs. 8 billion for the Elections Commission. (Sandun A. Jayasekera)