Sri Lankan airlines paid massive sums for failing business plan

Sri Lankan airlines paid massive sums for failing business plan

Written by Staff Writer

12 Sep, 2018 | 10:35 pm

Colombo (News 1st) – Early last week, News 1st reported that Sri Lankan Airlines had been suffering mammoth losses since Emirates ceased management of the company.

Testifying before the Commission on Wednesday, a former company Secretary at the Airline stated that certain decisions that led to these losses, including decisions that decided the direction of the business, were made without the board’s approval.

Following on from the questioning of Finance Chief Yasantha Dissanayake last week, today’s witness revealed that the Airline had a new business plan formulated in the years 2010-11 under the leadership of then CEO Manoj De Vass Gunawardena.

The recommendation of the three-year business plan had coincided with the appointment of Kapila Chandrasena as a paid consultant, receiving a monthly remuneration of Rs. 250,000.

Interestingly, it was revealed that at the time, the board required an international party to come in to do a verification of the business plan. For this purpose, they hired a Delaware based organization named VIA Capital Partners in 2010, to come up with a business plan for a sum of USD 450,000.

Coincidentally, this firm failed to provide references of their consultation service, as they themselves were relatively new. This raises the question on why Sri Lankan Airlines were willing to pay a new firm with no experience a large amount of money for their services.

The commission revealed today (September 12) that Sri Lankan Airlines spent USD 450,000 on a foreign consultant while already employing a local at a cost of Rs. 250,000 a month.

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