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Tuesday October 27th, 2026

Government has blatantly violated the Constitution by presenting this Appropriations Bill – Sumanthiran

The sun sets over the Parliament at Shri Jayewardenepura

ECONOMYNEXT- Opposition Member of Parliament M A Sumanthiran is accusing the government of “blatantly violating the Constitution” by asking the House to approve of an Appropriation Bill for monies that have already been spent.

Speaking in Parliament during the First Reading of the Ilankai Tamil Arasu Katchi (ITAK) MP said: “we are trying to legitimize grave illegal and unconstitutional acts that have been purported in this country.”

An Appropriation Bill must be debated and approved prior to the financial year for which it applies. It is only then the Executive obtains the approval of Parliament to draw from the consolidated fund, borrow and generally administer the finances of the country, the veteran advocate of the Supreme Court said.

Article 148 of the Constitution “very clearly says that the Parliament will have full control over Public Finance. No tax rate or any other levy will be imposed by any local authority or any other public authority except by or under the authority of a law passed by Parliament or of any existing Law. So, there is no law until now passed for the financial year 2020 that the Parliament has approved” Sumanthiran pointed out.

“What was approved were certain resolutions under A.150 sub A.2. Now those resolutions do not permit levying of taxes or borrowing by the government,” he said.

“Article 152 says, no such warrant shall be issued unless the sum, has by resolution of Parliament or Law being granted for specified public services for the financial year during with the withdrawal is so is to take place or is otherwise lawfully charged under the Consolidated Fund,” he went on.

Sumanthiran said such a resolution can only the drawing from the consolidated fund, such sums of money that are necessary for public services and that too for specified public services only.

“You cannot do any developmental work. You can pay salaries of public servants and other expenditure related to public services. During this financial year, we have had 2 such resolutions passed. One covering the periods 1st Jan 2020 until 30th April 2020 passed in Oct last year. And another covering the period 1st Sept 2020 to 31st Dec 2020. Now even those 2 resolutions passed by this House can only be used to pay for specified public services and not anything else” he said.

Today on this very strange Bill that we are debating, it is called the Appropriation Bill for 2020 and we are debating it in the month of November 2020.

The Bill that is before us is not only a strange Bill but it is an act to coverup various illegalities that have been purported in this country. Now, why do I say this?

All of us know that this is not how finances have been handled in the country for this year. There has been a severe need to make payments, to spend to make grants to the general public who were affected in several areas who were given 5000/- in the month of April and May in the whole country.

None of those was public services. But all those expenditures were done, expenses were met, developmental activities were carried out. All this in violation of the very strict limitation imposed by the Provision of the Constitution that says for specific Public Service only. So, there is a blatant violation of Constitution by this government and what is worse for the period 1st May to 31st August there was no resolution under A152.

What the Hon. Minister of Finance said today is that twice the President acting under A 150 sub-article 3 authorized expenses. Now, what does Article 153 say? Where the President dissolves Parliament before the Appropriation Bill for the financial year has passed into law he may unless Parliament has already made provisions authorize and issue from the consolidated fund and the expenditure of such sums as he may consider necessary for the public services. He can only authorize spending for public services until the expiry of 3 months from the date of which the new Parliament is summoned to meet.

Originally the new Parliament was summoned to meet in May 2020. Thereafter, after the Elections Commission postponed the elections it was put off until the 20th of August 2020. Nevertheless, the very limited authorities that a constitution gives a president is during a period of dissolution he can authorize, he can only authorize for public services, expenditure for public services and nothing else. Now there are 2 issues here, he can authorize for expenditure. But only for public services and nothing else. If you look at the Bill before us that has all kinds of developmental activities specified. Bad it is that this is coming in the month of November for this financial year, it is blatantly revealing to us that what has been expended is far beyond the authority that the Constitution gives the President.
(Colombo, November 13, 2020)

Reported by Arjuna Ranawana

Sri Lanka Cabinet approves $60mn OPEC Fund loan for Mahaweli project Phase 2

ECONOMYNEXT – Sri Lanka’s Cabinet of Ministers has approved a proposal to enter into an agreement with the OPEC Fund for International Development (OFID) to secure a 60 million US dollar loan facility for Phase 2 of the Mahaweli Water Security Investment Program (MWSIP).

The total estimated cost for Phase 2 of the program is 536.5 million dollars, which the government plans to finance through co-financing arrangements with multiple development partners. The Asian Development Bank (ADB) has already agreed to provide 200 million dollars toward the program.

“Phase 2 of the Mahaweli Water Security Investment Program is planned for implementation to achieve the Government’s long-term objectives: enhancing food security in the Dry Zone, strengthening water resource management, improving resilience to climate change, and alleviating poverty,” Minister Nalinda Jayatissa said.

Following prior cabinet approval on July 20, 2026, to begin negotiations with OFID, the development fund confirmed its willingness to provide the 60 million dollar facility in two components of 48 million dollars and 12 million dollars.

The proposal was submitted by the President in his capacity as the Minister of Finance, Planning, and Economic Development.

Under Phase 2, key construction works include finishing the remaining section of the main tunnel with about seven kilometers of excavation, constructing 68 kilometers of open and covered canals, conduits, and short tunnels, and building an eight-kilometer canal section for the Ellapothana Irrigation Project.

The project will also establish commercial farming infrastructure, including around 13 pressurized distribution networks to supply reliable irrigation water for high-value and field crops.

The cabinet paper noted that the phase will also focus on:

“Transforming agricultural production systems by introducing climate-resilient value chains and expanding farmers’ access to financial services and agricultural project-related services.” (Colombo/Oct27/2026)

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Sri Lanka stocks close up, ASPI gains 0.27-pct

ECONOMYNEXT – Sri Lanka’s Colombo Stock Exchange closed up on Tuesday, CSE data showed, with the benchmark All Share Price Index moving up 0.27 percent.

The ASPI was up 52.11 points at 19,693 (19,692.67), while the more liquid S&P SL20 was up 0.19 percent, or 10.44 points, at 5,612 (5,612.31).

Positive contributors to the ASPI were Dialog Axiata (up 0.48 percent at 42.20 rupees), Carson Cumberbatch (up 1.02 percent at 670 rupees), Ceylon Cold Stores (up 1.25 percent at 121.50 rupees), Laugfs Gas (up 5.07 percent at 37.30 rupees), and Lion Brewery (Ceylon) (up 1.86 percent at 1,849.75 rupees).

Colombo Dockyard (down 3.74 percent at 95.30 rupees), Vallibel One (down 1.19 percent at 83 rupees), Hatton National Bank (down 0.27 percent at 367.50 rupees), LOLC Finance (down 2.22 percent at 4.40 rupees), and LOLC Holdings (down 0.64 percent at 390 rupees) were top negative contributors.

Market turnover was 849.37 million rupees. Materials led turnover with 229.66 million rupees.

Digital Mobility Solutions Lanka announced a first interim dividend of 2.75 rupees per share for the financial year 2026/27, subject to withholding tax. The ex-dividend (XD) date is November 5, 2026, and the dividend payment is scheduled to be dispatched on November 25, 2026. (Colombo/Oct27/2026)

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Sri Lanka rupee closes at 332.40/50 to US dollar spot, bond yields edge up

ECONOMYNEXT – Sri Lanka’s rupee closed at 332.40/50 to the US dollar in the spot market on Tuesday, weaker from 332.25/35 the previous day, while bond yields closed slightly higher, dealers said.

A bond maturing on 15.09.2029 closed flat at 11.08/15 percent.

A bond maturing on 01.08.2030 closed at 11.55/60 percent, up from 11.45/55 percent.

A bond maturing on 01.02.2031 closed at 11.75/80 percent, up from 11.70/75 percent.

A bond maturing on 01.12.2031 closed at 11.85/95 percent, up from 11.80/90 percent.

A bond maturing on 15.01.2033 closed at 12.15/30 percent, up from 12.15/25 percent.

A bond maturing on 15.10.2034 closed at 12.5/60 percent, up from 12.45/55 percent. (Colombo/Oct27/2026)

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Sri Lanka approves performance-based framework for SOE collective agreements

ECONOMYNEXT — Sri Lanka’s Cabinet of Ministers has approved a new performance- and sustainability-based framework for collective agreements in State-Owned Enterprises (SOEs), which will take effect from January 1, 2027, minister Nalinda Jayatissa said.

The decision follows an earlier cabinet decision when the government decided to extend existing collective agreements in state enterprises under their current terms and conditions until December 31, 2026, while preparing a revised structure for 2027.

To facilitate the transition, the Secretary to the Treasury appointed an expert committee tasked with reviewing the current collective agreement mechanism and formulating the new framework.

Following consultations with relevant stakeholders, the committee submitted its report.

According to Jayatissa, the expert committee recommended aligning workplace pacts with key statutory regulations:

“It is recommended that collective agreements be implemented within state-owned enterprises, subject to the Industrial Disputes Act, the Trade Unions Ordinance, the Shop and Office Employees Act, and other relevant labour laws.”

The new structure also addresses employee incentives and financial returns.

“Recommendations have also been put forward regarding a framework for profit-sharing and bonuses.” (Colombo/Oct27/2026)

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Sri Lanka awards Rs756.9mn road project to Asset Engineering

ECONOMYNEXT – Sri Lanka’s Cabinet has approved a proposal to award a road improvement contract to cover an additional section of roadway in the Central Province to Asset Engineering (Pvt) Limited, minister Nalinda Jayatissa said.

The contract is valued at about 756.9 million rupees (excluding taxes).

The project will upgrade the road from kilometre 10+500 to kilometre 16+890 on the Norwood-Bogawanthalawa-Campion (B329) route.

Bids were called and 3 bids were received, Jayatissa said. (Colombo/Oct27/2026)

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Sri Lanka to lease 15 plantation properties to investors

ECONOMYNEXT – Sri Lanka’s Cabinet has approved the long-term leasing of 15 state plantation properties to selected local investors, minister Nalinda Jayatissa said.

The assets are owned by the Sri Lanka State Plantations Corporation, the Janatha Estates Development Board and Elkaduwa Plantations Company.

The government had earlier called for expressions of interest from investors for 1,514 hectares of land, 10 tourist bungalows and scenic locations, and 15 inactive factories managed by the three plantation entities.

A total of 470 investors submitted expressions of interest, Jayatissa said, after which shortlisted applicants were invited to submit detailed proposals.

“The government received 44 proposals covering 50 land and property lots.”

“Cabinet approved the proposal to lease 15 selected land and property plots to investors on a long-term basis.”

The government expects the initiative to attract private investment and improve the utilization of underused plantation-sector assets, he said.

He did not respond to reporters’ questions on how long the lease periods are, or how much the government hopes to raise through the leasing, or if the lands and properties will be distributed among parties loyal to the government.

Historically, most lands under the SLSPC and JEDB originated from the 1972 and 1975 land reform laws, when large privately owned plantations were taken over by the state. Many tea, rubber and coconut estates were nationalized and later placed under state plantation entities. (Colombo/Oct27/2026)

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