From left: Colombo University Economics Department Senior Lecturer Indrajith Aponsu, World Bank Senior Country Economist for Sri Lanka and Maldives Ralph Van Doorn and Colombo University Economics Department Senior Lecturer Dr. M. Ganeshamoorthy
Pic by Damith Wickramasinghe
By Chandeepa Wettasinghe
The government’s attempts to extend fishing rods to Sri Lankans instead of fish to relieve their hunger will be sorely tested due to the upcoming elections and the dependent mentality of locals, senior academics said recently.
“We’re coming up on elections. The dependant mentality of Sri Lankans still prevails. So whichever programme has to be more targeted and action-oriented,” Colombo University Economics Department Senior Lecturer Dr. M. Ganeshamoorthy said recently.
Speaking at a seminar organized jointly by the World Bank and the Colombo University Economics Department and the Economics Students’ Association, he said that Finance Minister Mangala Samaraweera’s direction of the 2018 budget may run into challenges when distributing the fishing rods.
“A government whose vision is to develop the country, should not be to give away a piece of fish and make people ‘economically handicapped and entirely government-dependent’, but to give them a fishing rod and create a means of living in order to meet their expectations,” the Finance Minister said during the recent budget speech.
Dr. Ganeshamoorthy has been of the view that Former President Ranasinghe Premadasa’s Jana Saviya programme, which attempted to also put a fishing rod in the hands of the people, failed, with the people selling the fishing rods to buy fish.
Dr. Ganeshamoorthy said that there are parallels between Premadasa’s policies and Samaraweera’s.
“Jana Saviya was a long time ago. The current programmes also have a welfare component as well as a participatory component. If you expand the participatory component with a target set of goals, we will be able to make use of these interventions fully,” the academic said.
The 2018 budget expanded mostly on the participatory aspect of people to improve their own livelihoods. But just 24 hours before the budget, Samaraweera imposed populist tax cuts, which would go into the account of the 2017 budget.
A development bank too is envisioned under the 2018 budget, to provide funds without collateral for Sri Lankans to improve their businesses. Implementation and monitoring of budget proposals has been a weakness in Sri Lanka in the past, which the Finance Minister himself admitted.
Therefore, a budget implementation unit has been set up to ensure that the budget proposals are executed in a proper manner, unlike before. While the budget is focusing on economically sound fiscal policies centred on liberalization, equity and empowerment, the Central Bank too is focusing on economically inflation targeting.
Dr. Ganeshamoorthy said that these policies will run into difficulty.
“Liberalization of the economy, fiscal consolidation and targeted monetary policy have mainly been suggested to stabilize the economy and put the economy on a high growth model, but inevitably that endeavour puts the more vulnerable groups in trouble, and past experiences suggest that they have been politically controversial and sensitive. In the past, even Sri Lanka had embarked on these policies, and stopped halfway,” he said.
However, he said that these policies are the need of the hour. Yet, the grassroot level elections are coming up next year for the first time during the rule of this government, the results of which may have significant impact on future elections, which many critics are viewing as the number one goal of the government now.
Colombo University Economics Department Senior Lecturer Indrajith Aponsu said that the reforms should have been undertaken during the first year of the government’s rule. “When a government comes into power, you get the best use of policy in the first year. If you miss that target you’re in a different situation,” he said.
This government is now in its third year, with most of the reforms promised so far being implemented after numerous delays, with more yet to be implemented. The government has provided the excuse that reforms get delayed in a democratic setting. However, delayed reforms lead to delays in generating results, which could help the government in winning votes.