Former Prime Minister S. W. R. D. Bandaranaike who swept to office in 1956 through the now- famous people’s force of the Sangha, wedha, guru, govi, kamkaru, was a brilliant orator but thankfully he was not limited to words and was more committed to deeds, much in contrast to most of today’s leaders.
His deep human values and principles manifested through a series of laws he initiated to restore the dignity of millions of workers. Among these laws were the declaration of May 1 as May Day, to commemorate the contribution of labour to the national wealth. This was followed by progressive amendments to the working conditions of the worker, in legislation relating to the Shop and Office Employees’ Act, Factory Workers Act and the Wages Boards Act governing remuneration to workers. The landmark achievement was the setting up of the Employees’ Provident Fund (EPF) which, through mandatory contributions from the employer and employee, guaranteed to workers and their families retirement benefits not hitherto available to the Sri Lankan working class.
Yesterday the Daily Mirror in its lead story reported the shocking news that the irregular investments of money from the EPF in the stock exchange had resulted in the loss of a staggering Rs.8.1 billion.
Speaking during the committee stage of the Budget debate, the main opposition, United National Party’s outspoken economist Harsha de Silva said the Central Bank had invested EPF money in about 65 companies though some of them were suffering huge losses. Among the shocking cases he revealed—which amounted to a serious betrayal of trust by the Central Bank and the Government—was the case of investment of EPF money in Ceylon Grain Elevators Ltd (Prima Group) which had bought 5,350,549 shares by June 20 last year at Rs.187, but the value had dropped drastically by this month, causing a loss of Rs.814 million. Also, 6,449,645 shares of Browns PLC had been bought at Rs. 266.41 each. The market price had dropped to Rs.81.70 by this month, leading to a loss of Rs.1.1 billion. Dipped Products, Laugfs Gas Co., Lanka Indian Oil Company and Galadari Hotel were among other companies where EPF money was invested but now had low investment portfolios.
Dr. de Silva tabled documents giving details of the mismanagement if not misuse or abuse of public funds in the EPF. He said these investments had been made regardless of guidelines set out in the EPF law. Though it is clearly laid down that EPF money should not be invested in financial institutions and banks, that principle was being blatantly violated by the Central Bank. According to regulations, EPF money should be invested only in the optional shares of blue chip companies.
From the time the law was enacted in 1958 about 14 million workers have contributed to the EPF and the value of the deposits exceeded one trillion rupees by December 2011 and billions would have been added to it by now—making it the largest fund in South Asia.
As usual the Government’s response was a sham and a shame with the Labour Minister Gamini Lokuge adding a farcical note to the fears of millions of people by claiming “there is nothing to worry”. He and other ministers or politicians who have allegedly been part of the unprecedented corruption and fraud involving billions of rupees in public money may have nothing to worry but the struggling workers and the people of Sri Lanka have a right to demand that the betrayal of trust and the misuse of their precious money be stopped and stopped now. President Mahinda Rajapaksa was once the Labour Minister and was widely respected as a champion of workers’ rights. We urge him to act now on behalf of the workers.