Sri Lankan Airlines at risk of further colossal losses

Sri Lankan Airlines at risk of further colossal losses

By Bella Dalima

22 Sep, 2017 | 10:12 pm

The Committee on public accounts has informed the government to cancel the manufacture order for four aircraft which SriLankan Airlines had proposed to purchase.

Chairman of COPE MP Sunil Handunnetti announced today, September 22, that the committee informed him to provide this advise to the government.

It was decided in 2013 to purchase four A350-900 aircraft and to lease three more aircraft of the same model for SriLankan Airlines. Orders were placed for this transaction to be carried out and the current government decided to cancel the agreement once it came into power.

The agreement to purchase three aircraft was canceled in the beginning of the year, and Sri Lankan Airlines had to pay a fine of approximately 154 million USD to the particular company.

A cabinet paper issued in this regard, however, says the fine would reduce to 98 million USD if Sri Lankan Airlines would complete the conditions laid out by the company.

The SriLankan airlines would now have to pay 98 million USD for three aircraft the country has never seen.

As per the initial agreement reached in 2013, three more A350-900 air craft are to be leased this year.

Chairman of COPE, MP Sunil Handunetti expressed these views:

[quote]We cancelled the purchase of four Airbus aircraft, we terminated the agreement and 115 million USD has been paid as fines. We are carrying out a separate investigation regarding this. There is a problem now. The committee appointed me to draw the attention of the house towards this problem. The decision as to whether we will purchase more Airbus Aircraft or if we are not, that company will begin the manufacturing in September. If we cancel once the manufacturing begins we will have to pay large amounts in fact millions in fines.[/quote]

Meanwhile, the Leader of the House Minister Lakshman Kiriella stated that If the Auditor General has made some observation regarding the Air Buses, MP Sunil Handunetti can question this in COPE.

He further noted that if he is asking this in the parliament he is going beyond his powers. COPE cannot question the policies of the government. They are questioning the government policies here. He can question whether this is right or wrong as an MP. COPE cannot provide advice to the parliament.

In response, Minister of Health Dr. Rajitha Senaratne said that MP Handunetti has submitted this for the greater good. He says that agreement has only limited amount of time for them to begin manufacturing.

”We will have to pay more if they start the process. So before that, take a decision and sign the agreements. If they commence the manufacturing we will sometimes have to pay more,” added Dr. Rajitha Senaratne.