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Sunday December 10th, 2023

Over 250,000 Sri Lankans to receive Aswesuma welfare pay on Sep 08: official

ECONOMYNEXT – Over 250,000 Sri Lankans who have signed up for the new consolidated welfare scheme Aswesuma will have their banks credited totalling 1.5 billion rupees in aid Friday September 08, an official said.

“As the second phase of ‘Aswesuma’, a payment of 1,550 million rupees for another 257170 beneficiaries has been paid for the month of July. Accordingly, the banks will credit the beneficiary accounts by tomorrow,” State Minister of Finance Shehan Semasinghe tweeted Thursday September 07 afternoon.

The Welfare Benefits Board will make the payments for the remaining beneficiaries after verification of accounts, he said.

“It is possible to make the payment for the month of August at one go for all beneficiaries after the payment for the month of July is completed,” he added.

The state minister said 791,000 beneficiaries were paid 5,016 million rupees in the first phase, while the second phase saw 1,048,170 families paid 6,566 million rupees by the government. Upon completion of surveys related to appeals and objections, payments will be made to all beneficiaries, he said.

Semasinghe said on August 28 that investigations into appeals made by applicants will be sped up. If there are beneficiaries who have received benefits by giving false information, after verifying, the Welfare Benefits Board will take action to recover the money given and take legal action, he said.

The government will ensure that no eligible citizen is left behind, he added.

Over 1,280,000 families who have been receiving the existing Samurdhi welfare benefits have applied for Aswesuma, out of which 887,653 have qualified, according to Semasinghe. Earlier this month, the cabinet of ministers elected to extend the Samurdhi allowance to 393,094 families who are not qualified but receiving Samurdhi until the appeals/objection process is concluded.

There has been criticism that Samurdhi was earlier given to mainly politically connected persons, while many poor people could not get the payments unless they worked on election campaigns.

Sri Lanka started Aswesuma, its new consolidated welfare payments scheme, after a large number of people were tipped into poverty when the rupee collapsed from the most aggressive macro-economic policy (rate cuts and tax cuts) employed by the country’s economic bureaucrats since a money printing central bank was set up.

Social Empowerment State Minister Anupa Pasqual told reporters on July 11 that the government launched the Awesuma programme in response to allegations that the existing welfare scheme system was too politicised, with criticism specifically levelled at the Samurdhi scheme.

Aswesuma was launched by the Welfare Benefits Board following a proposal by President Ranil Wickremesinghe, said Pasquel, adding that the president “intends to create an entrepreneurial state instead of a welfare state.”

Welfare beneficiaries have been organising protests against alleged injustice in the evaluation process of Aswesuma, even as the government and opposition trade charges in what has now become a fresh political controversy following a significant rise in poverty.

Semasinghe has said that the Samurdhi programme can continue its broader mandate of lifting people out of poverty while the new Aswesuma scheme will concern itself with direct cash transfers to deserving people without the involvement of a third party.

He said at an event on August 01 that Sri Lanka’s existing welfare system, which he said had enabled political parties and individuals to add and remove beneficiaries as they saw fit, has now ceased.

He conceded, however, that the new system is not without its issues.

“Because this is a new system that changes the established one, it is not without its shortcomings. We plan to address these shortcomings in the near future and also work to provide more welfare to the most deserving people,” said Semasinghe.

Insisting that Samurdhi benefits are not being slashed, the state minister said paying welfare benefits was only a small part of Samurdhi’s mandate.

“It had a much broader scope. While allowing Samurdhi to continue its mandate to lift people out of poverty, welfare benefits are to be paid by a different institute,” he said.

“The bank accounts of the selected applicants have yet to be opened. That will be done. What is being established here is a system for the funds to go to your account without the involvement of a third party,” he added. (Colombo/Sep07/2023)

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ADB USD200mn loan for Sri Lanka economic stabilization efforts

ECONOMYNEXT – The Asian Development Bank (ADB) has approved a US 200 million dollar concessional loan to Sri Lanka to help stabilize the country’s finance sector.

The Financial Sector Stability and Reforms Program comprises two subprograms of IS 200 million dollars each, according to a statement by the ADB.

“The program’s overarching development objective is fully aligned with the country’s strategy of maintaining finance sector stability, while ensuring that banks are well-positioned for eventual recovery,” ADB Country Director for Sri Lanka Takafumi Kadono was quoted as saying in the statement.

“The expected development outcome is a stable financial system providing access to affordable finance for businesses in various sectors of the economy.”

The ADB statement continues:

“Subprogram 1 targets short-term stabilization and crisis management measures that were implemented in 2023, while subprogram 2 is planned to be implemented in 2024 and focuses on structural reforms and long-term actions to restore growth in the banking sector.

The program will help strengthen the stability and governance of the country’s banking sector; improve the banking sector’s asset quality; and deepen sustainable and inclusive finance, particularly for women-led micro, small, and medium-sized enterprises.

According to the International Monetary Fund’s (IMF) latest review, Sri Lanka’s economy is showing tentative signs of stabilization, although a full economic recovery is not yet assured.

The program is a follow-on assistance from ADB’s crisis response under the special policy-based loan that was approved for Sri Lanka in May 2023.

It is aligned with the fourth pillar of the IMF’s Extended Fund Facility provided to Sri Lanka to help the country regain financial stability.

It is also in line with the government’s reform agenda, including strengthening the operational independence of the Central Bank of Sri Lanka (CBSL) and its designation as the country’s macroprudential authority.

In designing this subprogram 1 loan, ADB has maintained close coordination and collaboration with the IMF to design targeted regulatory reforms for the banking sector—including the asset quality review—and with the World Bank on strengthening the deposit insurance scheme.

“The loan is accompanied by a $1 million grant from ADB’s Technical Assistance Special Fund to provide advisory, knowledge, and institutional capacity building for Sri Lanka’s Ministry of Finance and CBSL.”

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Sri Lank in blackout as power grid hit by cascading failure

ECONOMYNEXT – Sri Lanka suffered a blackout as Saturday evening as the state-run Ceylon Electricity Board grid was hit by a cascading power failure.

The cascading failure is believed to have been triggered by the failure of the Kothmale-Biyagama transmission line.

“The Ceylon Electricity Board wishes to inform our customers that due to the failure of Kotmale – Biyagama main transmission line, an island wide power failure has occurred,” CEB Spokesman Noel Priyantha said.

“Step by step restorations are underway and it may take few hours to completely restore the power supply.”

With hydro plants running flat out, a outage of the line tends to create a big imbalance in the demand and supply, leading to tripping of more lines and generators.

Lines can trip due to lightening strikes, or equipment failures.

Sri Lanka last suffered a cascading failure in December 2021, due to the failure of the same transmission line.

RelatedSri Lanka power blackout as grid hit by cascading failure

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Sri Lanka to host regional Food and Agriculture Organization conference

ECONOMYNEXT – Sri Lanka will host the 37th session of the Asia Pacific Regional Conference (APRC) of the United Nations Food and Agriculture Organization (FAO), from February 19-22, 2024 in Colombo.

The Conference will bring together agriculture ministers and officials from 46 countries across the region to discuss challenges in food and agriculture.

“The 37th APRC will provide a vital platform for regional collaboration, benefitting the agricultural landscape, fisheries sector and environment of Sri Lanka,” Minister Mahinda Amaraweera said at a press briefing on Friday (8) to announce the conference.

FAO has had an active presence in Sri Lanka for over 40 years. “FAO has supported the country in the implementation of Good Agricultural Practices (GAP), and the development of the fisheries sector for growth and climate resilience,” Vimlendra Sharan, FAO Representative for Sri Lanka and the Maldives said.

“The APRC conference will be an opportunity to highlight the innovative approaches introduced in partnership with the government.”

By hosting APRC, Sri Lanka hopes to demonstrate the country’s dedication to the growth of sustainable agriculture, and showcase its commitment to sustainable agricultural development.

The APRC agenda will include a forum on agritourism, especially requested by the Sri Lankan government.

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