Image courtesy EY
As Sri Lanka heads towards completing nearly a month of lockdown, with first the special public holiday route adopted from 16th March and then curfew from 20th March onwards, there are emerging a set of medium to long term issues, in addition to the short term measures being adopted to “flatten the curve” or reduce and stretch out the time of the spread of the Covid-19 virus in the country. The immediate short-term measures recommended by the health authorities and eventually adopted by the Government, perhaps after some hesitation, has certainly resulted in the spread of the Covid-19 virus being contained in Sri Lanka. However, as it becomes clearer now that the risk of the spread of the virus of epidemic proportions, will be around and not actually totally abate, until a vaccine and other new medical therapies and treatments are found, there are some emerging medium-term governance and longer-term economic issues which are emerging and have been flagged by the relevant parties concerned.
Last week, the Chairman of the Elections Commission wrote to the Secretary to the President, effectively the head of the civil service, to appraise His Excellency the President, that a general election to Parliament could not be held as per his gazette notification of March 2nd, prematurely dissolving the Parliament of Sri Lanka, four and a half years into its five-year term. Hard on the heels of this missive from the Elections Commission, several smaller political party leaders, have called for the recall by the President of his gazette notification on the grounds that the state of public health does not allow for the mass socialization and internal migration which a general election necessarily entails. In the alternate others have called for summoning of the dissolved parliament as permitted in the Constitution, for the purpose of a national emergency. The rationale for the recall of Parliament or the rescinding of the gazette dissolving parliament, is that Parliament has a further period in its term and the early dissolution was a discretionary political move, a presidential prerogative under the constitution after the lapse of four and a half years after a parliamentary election, but now impractical under the existing public health situation and hence should be withdrawn, as it is impractical and not implementable.
Several analysts and government voices have argued that the government is handling the Coronavirus situation satisfactorily and there is no need to summon parliament. However, several compelling arguments to the contrary exist. Firstly Sri Lanka, like any other civilized nation on earth, is not fighting the virus with its constitution suspended and under an emergency. Other civilized nations in the world have not done so either. This global pandemic is being fought by nations as civilized societies under the rule of law. Accordingly, under law basic and crucial public finance issues exist. It is a well-founded principle in most democratic governance norms, including in Sri Lanka, that the control of public finance, through the approval of the annual state budget and the oversight of government expenditure by the executive is done by the legislature, in the tradition of the separation of powers and the checks and balances, inherent and essential in a democratic society under law.
Both the former Finance and State Finance ministers, Mangala Samaraweera and Eran Wickramaratne respectively have highlighted variously, the need to extend the Vote on Account passed by the new SLPP Administration upon its assumption of office, raise the debt ceiling to continue borrowing and also create a legal basis for various public safety measures being adopted including the ongoing curfew, which is a “police curfew” rather than a nationally declared one possible under several laws, but which would then require parliament’s concurrence. In real politic terms, complicating matters for the government, is that it is a minority government in Parliament, popular in the country through its mandate in last November’s presidential election, but cautious almost pessimistic about its ability to get Parliamentary approval for any of its initiatives. However, a legal limbo over state finance does not augur well for our long-term attractiveness as an investment destination, our international credit ratings and ability to tap global financial markets. Sri-Lanka will require to tap global financial markets to refinance that portion of its public debt maturing in 2020, a not inconsiderable Billion dollars or so and in an environment when global recession may occur.
Of more immediate concern though, as the lockdown curfew continues in the most densely populated of Sri Lanka’s districts namely the Colombo, Gampaha, Kandy, Jaffna and Kalutara districts, is the livelihood and income requirements of the self-employed and the casual laborer, mostly found in the populated urban areas of the above districts. The government proposes a Rupees five thousand a month stipend or supplies of that value to them, which relief has not yet commenced and the adequacy of which for say a typical family of four or more, is questionable. In the medium term, managing the economy, especially on the production and supply side becomes crucial, especially given our skewed income distribution in society. Quite quickly the urban poor can become destitute and vulnerable, with food security and scarcity an issue. The pressure on Sri Lanka’s exchange rate has also been acute, with the Sri Lankan Rupee depreciating over eight percent since end Feb to mid-April. In the medium term, there is a need to move from complete lockdown, to a partial lockdown and then life style changes to maintain social distancing until the threat of a fresh outbreak of the virus recedes through new medical treatments, therapies and vaccines. The complex and challenging governance issues facing us, during these unprecedented times, is best dealt with in a bi-partisan manner, with consultation and consensus.
(The writer served as Advisor, Ministry of Foreign Affairs from 2016-17)