Bringing back ‘Emirates Era’: SriLankan business plan, a damp squib | Page 2 | Sunday Observer

Bringing back ‘Emirates Era’: SriLankan business plan, a damp squib

In the wake of continuous failure to endure the prosperous ‘Emirates Era’ of the national carrier, the SriLankan Airlines had disbursed Rs. 50.6 million to review an internally prepared business plan, revealed the Presidential Commission to inquire into allegations of large scale frauds and malpractices in SriLankan Airlines, SriLankan Catering and Mihin Lanka, last week.

According to a decision made by the Board of Directors, SriLankan had appointed its former Head of Finance Senaka Chandrasekara to prepare a business plan (2011/12- 2014/15) for SriLankan, Yasantha Dissanayaka current Head of Finance in SriLankan told at the Commission.

According to his testimony Chandrasena had been paid Rs. 750,000 for preparing the business plan in three months.

“He was assigned the task on March 1, 2010 and he completed and handed it over on July31, 2010” witness said. However, at the cross examination Senior Deputy Solicitor General Niel Unamboowe noticed something fishy in decision making in the business plan.

According to the testimony, Via Capital, the foreign entity hired to review Chandrasekara’s business plan had written to the then Ports and Aviation Ministry Secretary Ranjith de Silva and then Public Enterprise Department Director General Suren Batagoda, showing their interest in taking part in consultancy services for the sinking airline. This letter had gone to relevant officials on January 7, 2010, nearly two months before Chandrasekara’s appointment to a similar task.

After Chandrasekara’s plan was submitted which recommended a capital infusion of US$ 300 million by the Treasury as SriLankan’s principle party, Manoj Gunewardene then CEO of Sri Lankan had advised to look for a foreign agency to review it.

Then Chairman of SriLankan Nishantha Wickremesinghe, the brother of Shiranthi Wickremesinghe Rajapaksa the former First Lady, had appointed a five-member committee to hire a suitable foreign agency.

However, the committee had recommended hiring Via Capital even though it possessed no similar experiences where 11 other experienced players had forwarded their proposals.

“Did SriLankan go for the cheapest proposal or what happened here?”, questioned Unamboowe.

“No your honour. We don’t try to find the cheapest for a work of this nature” said Dissanayake.

However, Kapila Chandrasena who was appointed as the CEO of SriLankan on August 1, 2011 had informed the director board that there is not much difference between Chandrasekara’s original business plan and the review prepared by Via Capital, other than lifting the government capital infusion up to US$ 520 million, some of the route changes and the type of air craft to be purchased. The finalised business plan has received an observation by former President Mahinda Rajapaksa, who was the Finance Minister at that time, recommending the US$ 520 million capital infusion by the Treasury.

He had clearly mentioned that the amount which was to be released in installments starting from Budget 2012, should follow a proper evaluation. Nevertheless the entire business plan was a damp squib as Sri Lankan kept on incurring colossal losses.

Comments