Is Speaker’s announcement consistent with SC determination?
Bill titled ‘Central Bank of Sri Lanka’:
By Shamindra Ferdinando
Speaker Mahinda Yapa Abeywardena made the following announcement immediately after the opening of Parliament on April 04, 2023. The Speaker declared: “I wish to make an announcement in respect of the Bill titled ‘Central Bank of Sri Lanka.’ The court has determined that none of the provisions in the Bill are inconsistent with the Constitution. Accordingly, the court has determined that the Bill can be passed by a simple majority in parliament subject to the amendments which have been mentioned in the determination. I order that the full determination of the Supreme Court be published in the official proceedings of the parliament today.”
Education Minister Susil Premjayantha was the first to address the House after Speaker Abeywardena made several announcements. The video released by parliament showed all seats around Premjyantha empty.
Samagi Jana Balawegaya
(SJB) and Opposition Leader Sajith Premadasa MP who was present in parliament raised the continuing crisis at the Ruhuna University. Chief Opposition Whip Lakshman Kiriella was seated next to lawmaker Premadasa while SJB General Secretary Ranjith Madduma Bandara sat behind the Opposition Leader.
In spite of the fact that April 04 being the only day the parliament met this month, the House was largely empty. Quite surprisingly, no one present sought a clarification as regards Speaker Abeywardena’s statement on the ‘Central Bank of Sri Lanka’ Bill.
If not for Gevindu Cumaratunga, MP, and leader of civil society organisation Yuthukama, Speaker Abeywardena’s announcement would have gone unchallenged before the Sinhala and Tamil New Year. In fact, those responsible for very serious offenses probably thought the Speaker’s announcement on the SC determination would go unchallenged.
Lawmaker Cumaratunga dropped a bombshell at a hastily arranged media briefing at the Communist Party Office at Punchi Borella. Cumaratunga brought the latest development to the notice of the writer before he called the media briefing where he questioned the possibility of Speaker Abeywardena and Parliament being part of a conspiracy to deceive the Parliament, thereby mislead the public.
Speaking on behalf of the Uthara Lanka Sabhagaya (ULS), MP Cumaratunga explained how the Parliament deprived its members’ copies of the SC determination before the announcement was made. Had there been copies of SC determination, those present could have immediately realised the Speaker’s announcement was contrary to the SC ruling, lawmaker Cumaratunga declared. Did anyone instruct those responsible for releasing such communications received by the Speaker from the Chief Justice not to do so?
There hadn’t been a previous instance of such an important SC ruling brazenly misinterpreted, deliberately. Who prepared the short notice in English read out by the Speaker?
The CJ’s communication in English conveniently allowed the Speaker to make the announcement, too, in that language only.
Unfortunately, Cumaratunga’s media briefing didn’t receive the attention it deserved. Actually, the media due to ignorance on their part or otherwise largely ignored the issue at hand. Many an eyebrow was raised at lawmaker Cumaratunga’s shocking exposure, that hadn’t jolted the Opposition into action at least by last Friday.
The joint Opposition should have written immediately to the Speaker in that regard. Regrettably, the joint Opposition missed that opportunity.
It would be pertinent to ask whether the Speaker would respond to MP Cumaratunga’s accusations before the next parliamentary sittings. Parliament cannot allow further deterioration of public confidence in the country’s supreme institution.
Perhaps the Opposition should raise the issue at hand with the Committee on Ethics and Privileges as a matter of utmost importance. One-time Speaker Chamal Rajapaksa heads this committee. Interestingly, a new controversy over a deliberate attempt to mislead Parliament has erupted in the wake of a contentious move to summon SC judges before the Ethics and Privileges Committee.
The Bar Association’s declaration against the bid to summon SC judges over the March 03 ruling in respect of the Local Government polls should be appreciated. The statement dated April 05, warned the government of dire consequences unless the ongoing course of action was reversed.
However, deliberate misinterpretation of SC determination on the Bill titled ‘Central Bank of Sri Lanka underscored the Wickremesinghe –Rajapaksa dispensation’s readiness to do whatever if felt required. The latest action stressed their readiness to go the whole hog.
As Prof. Charitha Herath, former outspoken Chairman of the parliamentary watchdog committee pointed out, President Ranil Wickremesinghe brazenly took advantage of the developing political-economic-social crisis to advance his agenda. Herath, like colleague Cumaratunga accommodated on the SLPP’s National List quit the government parliamentary group last year. Both voted against UNP leader Wickremesinghe at the July 20, 2022 vote in which the incumbent leader received 134 votes of parliamentarians for him to be elected President to complete the remaining period of the previous President Gotabaya Rajapaksa, who was ousted by violent mobs despite him having been elected with a landslide majority.
A significant SC determination
The SC determination was contrary to what the Speaker announced in parliament that the court determined that none of the provisions in the Bill were inconsistent with the Constitution.
In fact, out of the 134 clauses in the Bill titled ‘Central Bank of Sri Lanka’, the Supreme Court had determined that 46 clauses required either to be passed by a 2/3 majority and 2/3 majority plus a referendum. The Speaker’s declaration cannot be justified under any circumstances though he ordered the publication of the SC determination in full in the day’s proceedings.
Justice Minister Dr. Wijeyadasa Rajapakse, PC, wasn’t present at the time the Speaker made the announcement.
The landmark determination was made by the SC bench consisting of Justices Priyantha Jayawardena, PC, Kumudini Wickremasinghe and Arjuna Obeysekere.
Petitioners were retired Lt. Col. Anil S. Amarasekara (Counsel Manohara de Silva, PC, with Haripriya Kumarage), Jehan Hameed (Canishka Witharana with Sawani Rajakaruna), Anura Darshana Perera Abeysekera (Counsel Canishka Witharana with Sawani Rajakaruna), Pivithuru Hela Urumaya leader Udaya Prabath Gammanpila, MP, (Counsel Manohara de Silva, PC, with Haripriya Kumarage), Dr. Gunadasa Amarasekera (Counsel Manohara de Silva, PC with Haripriya Kumarage), Ven. Athureliye Rathana thero of Ape Jana Bala Pakshaya (Counsel didn’t make representations in court), former JVP MP Wasantha Samarasinghe (Counsel Chamara Nanayakkarawasam with Dimuthu Fernando and Patali Abeyarathna).
The SC bench, too, appeared to have deviated from the usual presentation of such determinations of the court. However, having perused the 54-page document titled ‘Central Bank of Sri Lanka’, there cannot be any doubt the Speaker’s announcement contradicted the determination of the highest court in the country. But one can also assert that the section of the judgment titled ‘Determination’ didn’t clearly reflect the severity of the SC response to the Bill titled ‘Central Bank of Sri Lanka.’
Let me reproduce the section titled ‘Determination’ (page 53): “We have examined the other provisions of the Bill and are of the opinion that, subject to the above (emphasis mine) none of the provisions in the Bill are inconsistent with the Constitution. Therefore, we make our determination that the Bill can be passed by a simple majority in Parliament, subject to the amendments stated above (emphasis mine)
‘We wish to place on record our sincere appreciation for the assistance given by the learned Additional Solicitor General and the learned counsel for the petitioners and the intervenient- petitioners in the consideration of the Bi1l.
We also wish to place on record our sincere appreciation to Dr. Nandalal Weerasinghe, Governor of the Central Bank for assisting the court in making this determination.”
But consideration of what the SC bench referred to as amendments meant that the Bill titled ‘Central Bank of Sri Lanka’ is flawed.
Before proceeding further, it would be necessary to name intervenient petitioners, Ajit Damon Gunewardene, Murtaza Jafferjee, Dumindra Rajith Ratnayaka (Counsel Shivaan Coorey with Amanda Coorey, Dinithi Panambara, Damithu Surasena and Chamath Surasena), L.Y. Dharmasena ( Counsel Nilshantha Sirimanne with Deshara Goonetilleke), Chandra Jayaratne (Counsel Chandaka Jayasundere, PC with Viran Corea, S.A. Beling, Sayuri Liyanasuriya and Imaz Imtiyaz).
The counsel for the intervenient-petitioners assured the SC that no constitutional provisions have been violated by the proposed Bill. They assured the court that the proposed Central Bank Act explicitly provided for the financial stability, economic development, and accountability of the Central Bank.
Respondent was Attorney General (Sanjay Rajaratnam, PC), while the AG was represented by Viraj Dayaratne PC, ASG with Mahen Gopallawa SDSG, Nirmalan Wigneswaran DSG, Sureka Ahmed SSC, Amasara Gajadeera SC and Indumini Randeny SC.
Addressing the media at the Communist Party Office, Punchi Borella, lawmaker Cumaratunga asked who took the responsibility for preparing the Bill titled ‘Central Bank of Sri Lanka.’ Acknowledging that the AG has assured to make the necessary amendments at the Committee Stage, the civil society activist emphasized the powers that be owed an explanation how 46 clauses out of 134 (nearly one third of the Bill) were found to be contrary to the Constitution.
Unprecedented onslaught on new Bill
A careful examination of the high profile but thoroughly disputed Bill underscores the irresponsibility on the part of those responsible for the Bill titled ‘Central Bank of Sri Lanka.’
The crux of the matter is that the SC explicitly held that the Central Bank cannot be made independent of the Executive, in the formulation of monetary policy as well as the parliamentary oversight. And the acceptance of the proposed Bill would infringe Articles 3, 4, 43 and 48 of the Constitution. Obviously, the SC has largely accepted submissions made by Counsel for the petitioners.
Did the Cabinet of Ministers headed by President Ranil Wickremesinghe, who also holds the finance portfolio discuss this Bill? Did the President’s Counsels among the ministers, Justice Minister Dr. Wijeyadasa Rajapakse, and Foreign Affairs Minister Ali Sabry express opinion on this contentious matter?
Counsel for petitioners has drawn the attention of SC to Article 148 of the Constitution which read: “Parliament shall have full control over public finance. No tax, rate or any other levy shall 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. “
But, those who decried the new Bill must keep in mind that Parliament cannot absolve itself of the responsibility for the developing crisis.
Had Parliament exercised full control of public finance, how could those who moved SC against the controversial Bill explain the circumstances under which Treasury Bond scams were perpetrated in 2015 February and 2016 March during the tenure of yahapalana government. In fact, Ven. Athureliye Rathana Thera and Wasantha Samarasinghe’s JVP backed the yahapalana government to the hilt.The country wouldn’t have had to default on external debt last May if the Parliament fulfilled its responsibilities with regard to public finance. For those who considered SC determination a setback for the incumbent government, particularly President Ranil Wickremesinghe should also examine exactly how successive governments ruined the economy.
The government sought to introduce a new Bill against the backdrop of severe criticism that political interference caused the economic devastation. There is no point in denying the fact that the Central Bank and the five-member Monetary Board contributed to the collapse of the national economy caused by ill-conceived decisions such as abolition of long established foreign exchange controls under the yahapalana rule for inexplicable reasons and doing away of a range of taxes by the Gotabaya Rajapaksa government at the worst possible time and its refusal to seek timely IMF intervention for the 17th time until it was too late for the country and its own good.
Incumbent Central Bank Governor Dr. Weerasinghe’s harsh talk to MPs on Aug 31, last year and his statements before parliamentary watchdogs within weeks after assuming the hot seat set the record straight. The circumstances under which the national economy collapsed during Gotabaya Rajapaksa’s presidency are clear. Of course, Dr. Weerasinghe’s statements should be the basis for an examination of the political-economic-social crisis. The responsibility of the executive, legislature and judiciary should be examined taking into consideration Dr. Weerasinghe’s views.
The SC dealt with major differences between the proposed Central Bank Act and the current Monetary Law Act. The primary objective of the flawed Bill is to maintain domestic price stability, whereas the current law ensured both price stability and financial system stability. The proposed law prohibited monetary financing through purchase of government securities in the primary market though the current Monetary Law Act allowed purchasing of Treasury Bills.
The proposed law excluded public debt management from the Central Bank. This is meant to separate monetary policy and public debt management. The new law provided for a transitional provision for continuing public debt management pending the establishment of a public debt management apparatus.
The AG’s Department asserted that restriction of the government’s role in respect of monetary policy would not amount to alienation of the executive power, as the necessary link between the Executive and the governing bodies of the Central Bank is preserved.
Perhaps one of the most contentious issues is the Clause 3 wherein proposal was made: “The Central Bank shall have its principal place of business in Colombo, and may have such branches, agencies, and correspondents in other places in Sri Lanka or abroad, as may be necessary for the proper conduct of its business.”
Declaring that the words “and may have such branches, agencies, and correspondents in other places in Sri Lanka or abroad, as may be necessary for the proper conduct of its business,” are unwarranted and unjustified, the SC determined Clause 3 of the Bill is inconsistent with Article 12(1) of the Constitution.
SC also ruled that that Clause should be passed in Parliament by a special majority in terms of Article 84(2) of the Constitution.
It found fault with the following Clauses (5, 8, 9, 10, 13, 14, 15, 16, 17, 19, 20, 23, 24, 25, 31, 40, 43, 47, 59, 73, 80, 84, 85, 86, 100 (3), 102, 103(5), 106, 107, 108, 110, 111, 112, 113(2)(b), 190,120, 123 and 133.
Perhaps, the controversy surrounding the Bill titled ‘Central Bank of Sri Lanka’ should be examined taking into consideration how the yahapalana government abolished time-tested exchange control laws in 2017 and how it contributed to the current crisis.
Then what about private foreign exchange dealers who continue to enable the international drug mafia to freely convert their ill-gotten lucrative drug proceeds from rupees to hard currencies without any questions being asked.
