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UNCLAS SECTION 01 OF 02 COLOMBO 000753 
 
SENSITIVE 
SIPDIS 
 
STATE FOR SCA/INS AND DRL/IL FOR TU DANG 
STATE AND GENEVA PLEASE PASS TO USTR 
DOL/ILAB FOR TINA MCCARTER 
MCC FOR S GROFF, D NASSIRY AND E BURKE 
 
E.O. 12958: N/A 
TAGS: ECON EINV KCOR PGOV CE
SUBJECT: SRI LANKA: GSL WEAKENS CORRUPTION OVERSIGHT BY APPOINTING 
MINISTERS TO HEAD PARLIAMENTARY OVERSIGHT COMMITTEES 
 
REF:  A) Colombo 730 
B) 07 Colombo 1464 
C) 07 Colombo 1232 
D) 07 Colombo 779 
 
¶1.  (SBU) Summary:  In a move that is likely to encourage further 
government corruption, chairmanships of Sri Lanka's parliamentary 
Public Accounts Committee (PAC) and the Committee on Public 
Enterprises (COPE) were recently awarded to government ministers. 
These committees have been traditionally chaired by opposition 
parliamentarians to ensure accountability of government financial 
matters.  The appointments mark a further retreat in efforts to 
reduce corruption.  Paragraph 9 contains recommendations for the US 
executive directors on the boards of the World Bank and IBRD to help 
reduce corruption in Sri Lanka.  End Summary. 
 
----------------------------- 
Government "Watching" Itself 
----------------------------- 
 
¶2.  (U) On July 23, the Government used its Parliamentary majority 
to elect two cabinet ministers to head parliament's most important 
oversight committees, the Committee on Public Enterprises (COPE) and 
the Committee on Public Accounts (PAC).  Power and Energy Minister 
W.D.J. Seneviratne was appointed to head the COPE and Media Minister 
A.P. Yapa to head the PAC.  These two committees were reconstituted 
in June 2008 after the President pro-rogued Parliamentin May 2008, 
which led to the automatic dissolution of all Parliamentary 
committees.  With the government's majority in parliament, it was 
possible - and easy -- to install pro-government chairmen. 
 
¶3.  (SBU) These appointments, however, have been severely 
criticized.  The primary function of COPE and PAC is to exercise 
supervision of public funds used by government ministries and public 
enterprises.  It is customary for opposition or independent 
parliamentarians to chair the committees to ensure accountability in 
government financial matters.  Indeed, the previous COPE was led by 
Parliamentarian Wijedasa Rajapaksa (no relation to the President), 
who was named man of the year by a leading business magazine for his 
efforts to expose corruption.  Under his leadership, COPE  presented 
two damning reports that detailed corruption throughout the 
government.  Unfortunately, the government - although embarrassed -- 
took little action.  Frustrated with government inaction, the 
opposition did not even propose a candidate to chair COPE, and 
opposition members serving in PAC walked out before the vote for its 
chairman. 
 
¶4.  (SBU) The appointment of Seneviratne as COPE Chairman is a 
conflict of interest.  In its last report to Parliament in 2007, the 
former COPE cited the Ceylon Electricity Board as one of the 
institutions with most number of allegations of financial 
irregularity.  Seneviratne oversees the Ceylon Electricity Board 
(CEB) as Minister of Power.  Any investigation into corruption and 
mismanagement of funds at CEB is therefore unlikely; as a result, 
public confidence in COPE will further diminish. 
 
¶5.  (SBU) Likewise, Yapa's appointment to head PAC reflects a 
conflict of interest.  In a meeting on August 12 with Ambassador, 
Wijedasa Rajapaksa criticized Yapa's appointment, noting that many 
of the most corrupt state institutions are under his Ministry, 
including the Independent Television Network, the Rupavahini 
Corporation and Lakehouse, both of which oversee significant 
television and print media empires. 
 
------------------------------------------- 
NGOs and Opposition Criticize Appointments 
------------------------------------------- 
 
¶6.  (U) The Sri Lanka branch of Transparency International (TISL), 
which advocated against the appointment of ministers, issued a 
statement condemning the election of ministers to chair the 
committees.  TISL stated that it was an "intentional undemocratic 
move to weaken legislative scrutiny so that the irregular financial 
expenditure by the Executive would continue unabated."  TISL urged 
parliament to re-consider the decision and has called upon the two 
 
COLOMBO 00000753  002 OF 002 
 
 
Ministers to step down.  To date neither has. 
 
¶7.  (U) General Secretary of the main opposition United National 
Party (UNP), Tissa Attanayake, told news papers that the intention 
of the government was to cripple the investigations of the two 
committees.  The UNP is threatening to boycott these committees. 
 
--------------------------- 
Former Watchdog Pessimistic 
--------------------------- 
 
¶8.  (SBU) Ambassador asked former COPE Committee Chair Rajapaksa for 
his views on the way forward in combating corruption in Sri Lanka 
now that the COPE and PAC have been defanged.  Rajapaksa gloomily 
assessed that Parliament and its oversight committees "can't do 
anything" because of the control exercised by the ruling party and 
its allies.  He predicted the SLFP will continue to block not only 
new inquiries into corruption, but also action to prosecute those 
named in previous COPE and PAC reports.  For example, he noted with 
regret that the Government had blocked his efforts to create a COPE 
website to publicize its activities and reports and printed just one 
copy of the COPE report to prevent any circulation.  Rajapaksa said 
the problem is compounded by the weakness of the opposition, which 
has largely failed to pressure the Government to do more on 
corruption. 
 
----------------------- 
What Should the USG Do? 
----------------------- 
 
¶9.  (SBU):  Embassy will continue to work with Transparency 
International and other local groups to speak out about the 
importance of the Government addressing corruption.  We will also 
continue to ensure that no AID or other USG money goes directly to 
the Government where it might be diverted or misused.  Beyond that, 
we recommend that Washington agencies and the US executive directors 
on the boards of the World Bank and IBRD: 
 
- Pressure the IBRD and ADB to engage the Government on corruption 
and ensure there are very strict auditing guidelines to ensure Bank 
money is not mis-spent. 
 
- Urge that the Government allow passage of the Right to Information 
Law, modeled on India's successful legislation, to give citizens the 
right to petition the central and local governments for details of 
how money is being spent. 
 
- Urge that the Government replace the Chairmen of the COPE and PAC 
committees with independent Members of Parliament so that COPE and 
PAC can be empowered to perform their mandated roles. 
 
BLAKE