ECONOMYNEXT – Sri Lanka must provide direct cash transfers to low-income households and small & medium enterprises (SMEs) affected by a recent hike in electricity tariffs, opposition MP Kabir Hashim said.
Speaking in parliament on Monday August 29 during an adjournment debate on the impact of the tariff hike, the MP said rate hike unfairly impacted consumers that consumed the lowest number of units of electricity per month.
“There are two million who use under 30 units (though it is 1.4 million according to Minister Kanchana Wijesekara). Another two million who use 30 to 60. There’s a 125-percent for those who use 60 to 90, a majority of whom are salaried workers in the public and private sectors. Then there are SMEs who are effected.
“As the Samagi Jana Balawegaya, we propose that a direct cash transfer is made to these groups – something that’s even recommended by the International Monetary Fund (IMF).”
It wasn’t the consumers who are responsible for the crisis in the power sector, the SJB MP said, blaming it on politicians who had had deals with a privileged group within the state-run Ceylon Electricity Board (CEB) with vested interests.
However, the Power & Energy Ministry has defended the tariff hike saying that it was necessary and that when taken in isolation the percentage average increase seems like a bigger increase than it actually is in rupees.
The MP claimed the CEB is extremely inefficient and corrupt and that the general public must not be punished for the parties with vested interests including certain engineers, union leaders and ministry officials who have come together to gain the maximum benefits possible through unsavoury deals.
The CEB has illegally paid the income tax of the high-income earning employees of the CEB, he claimed, calling this influential cabal a ‘mafia’.
Sri Lanka’s electricity tariffs were raised for the first time in nine years earlier in August. The 75 percent overall hike came after a series of internal investigations and stakeholder consultations, at a time when the CEB is operating at massive losses, and the country is spiralling into an economic crisis.
MP Hashim also called for amendments to Sri Lanka’s Electricity Act which he said is outdated.
He also faulted the incumbent ruling party for scuttling efforts by previous United National Party (UNP)-led governments to restructure CEB.
“It is ironic that the task of restructuring the CEB has now fallen into your lap,” he said.
“It was this mafia that didn’t allow these reforms to take place all this time,” he added.
Restructuring is not a bad word, said Hashim, and that Sri Lanka must come up with a model that’s unique to the country, similar to efforts to liberalise the telecom sector in the 1990s.
“You created this crisis. It’s not the consumers who pay for it, but members of this government,” he said. (Colombo/Aug29/2022)