Proposed amendments to MLA detrimental: Opposition

30 July 2019 07:01 pm - 1     - {{hitsCtrl.values.hits}}

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The Opposition today said the proposed amendments to the Monetary Law Act (MLA) were detrimental to the economy and that it would go to the Supreme Court if and when the draft bill was presented to parliament.

Addressing a news briefing, Opposition MP Dr. Bandula Gunawardana said the Finance Ministry and the Central Bank of Sri Lanka (CBSL) would go their separate ways if the MLA was amended.

He said the Finance Minister had submitted a cabinet paper on March 8 to amend MLA No. 58 of 1949, with the objective of strengthening the independence of the CBSL and to facilitate the adoption of Flexible Inflation Targeting (FIT) as the monetary policy framework.

“However, the President on June 3 suggested that the proposed MLA should be reviewed by a committee of economists before it is submitted to the Legal Draughtsman and that it must go through a broader stakeholder dialogue and consultation process. Therefore, the cabinet on June 18 decided not to go ahead with MLA amendments and to refer the proposed amendments to the Committee on Public Finance in parliament. However, the cabinet is now going forward with the MLA amendments,” Dr. Gunawardana said.

He said it was only recently that the CBSL officials told the Parliamentary Select Committee (PSC) on the Easter Sunday attacks, that the recent amendments to the Foreign Exchange Act (FEA) restricted action to scrutinise receiving of foreign funds.

The CB officials said it was not possible to carry out an investigation on money transfers of the Batticaloa campus under the amended FEA as it did not even define an offence.

Dr. Gunawardane said the government had made a grave mistake by amending the FEA in an arbitrary manner and said if it amended the MLA the same way, it could further jeopardise Sri Lanka’s economy.

“Due to the FEA amendments, Sri Lanka has been sidelined internationally as a country which can’t take action on money laundering and foreign funding for terrorism. What if the government changed the MLA in the same manner? The entire money printing process will come to a standstill. The government should not amend bills to fulfil private agendas. We will raise our voices against this both inside and outside parliament. We will also go to the SC if the draft is presented to parliament without considering the President’s suggestions,” Dr. Gunawardana said. (Lahiru Pothmulla)

  Comments - 1

  • Sugath Wednesday, 31 July 2019 08:06 AM

    Dr B with elementary knowledge of economics is going against rather than making proposals how to strengthen it. It has been a long fell need in the country to prevent arbitrary money printing which is only serving the politicians objectives to the peril of the country and this is what CB governor is rightfully so proposing this amendment, and of course this may need to be strengthened by bring the treasury under the purview of the CB so that it will become entire responsibility of the CB to control the current account deficit which is the key performance indicator of the economy. Why these politicians wary about this amendment as the recent Pohotuwa strategist openly announced that he would provide duty free car permits to every gumbatas past and present if SLPP is elected. The people should worry about what impact it would make on the economy and the foreign exchange reserves, hard earned money by predominantly working class people, mainly through slavish labour


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