Validity of UNP footnotes challenged by experts

COPE report on bond scam

by Shyam Nuwan Ganewatta

Footnotes the UNP MPs got incorporated into the Committee on Public Enterprises (COPE) report on the Treasury bond scam, tabled in Parliament last Friday, were based on false facts and figures, sources told The Island yesterday.

The footnotes 01, 02 and 03 had no relevance to the Report’s arguments, sources said.

The COPE report presented to Parliament by its Chairman Sunil Handunnetti had been endorsed by 16 out of 26 members while nine UNP members endorsed it with footnotes, and UNP member Ranjan Ramanayake abstained.

Sources said that footnote 01 by the UNP MPs says that a paper issued by the Monetary Board on Jan 07, 2008 had permitted to raise funds through direct/private placements only for three month period. However, sources pointed out that a paper dated Feb 14, 1997 introducing treasury bonds and another paper dated Jan 07, 2008 had permitted direct/private placements but not mentioned any three month period limit.

The paper dated Jan 07, 2008 says that the interest rate could be reviewed after three month time period.

Thereafter, approval has been granted to use interest rates of a Monetary Board (MB) paper dated May 02, 2008 for the period from May 2008 to December 2008. Another MB paper dated Oct. 07, 2008 has recommended the guidelines to be followed when the government borrowed money for its needs. According to the these guidelines permission has been granted to issue Treasury bonds at an interest rate higher than 0.05 percent of the secondary market interest rates to the captive sources including the Employees Provident Fund, sources said, adding that permission was valid till today.

Sources said that footnote No 2 had been prepared on the basis of a letter obtained from a Central Bank official in Oct. 2016 in a hurry. Such a letter addressed to the COPE chairman should have been sent by the Monetary Board, which handled all correspondence with the COPE. Disciplinary action could be taken against the officer who sent the letter, sources said.

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