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Sri Lanka: Defence expenditure hits Rs 160 billion

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Monday, 15 October 2007

Last week, rhetoric could be heard louder than the burst of gunfire on the Wanni front.Yet, preparations for an escalation of military action were happening behind the curtain, both in the Wanni and in Colombo. The LTTE website nitharsanam, which is said to be under the direct supervision of LTTE intelligence wing leader Pottu Amman, quoted Tiger Peace Secretariat Chief S.Pulithevan as saying that the coming months will be crucial and decisive in terms of military operations. Pulithevan ruled out peace talks and said the LTTE was preparing for a major war.

“Basil Rajapaksa has declared that the Sri Lankan military has achieved 100% victory. He has vowed to capture the rest of our territory. We will give them the right answers to their questions. Peace talks are not likely to take place. As our opponents get ready to wage massive offensive operations from all corners, we, too, are prepared to face them... next month will be crucial,” Pulithevan was quoted as saying in the nitharsanam website.

“Our commandos and cardres have returned from the East. They are leading our strengthened forces. Therefore, future battles will not be on a small scale. Victory or defeat will be decided in these battles. We have taken a determined stand. We will not allow the Sri Lanka army to step into the Wanni territory. People will need to be prepared to face this war,” he said.

Although it sounded like pure rhetoric, Pulithevan’s utterances are in line with past conduct of the LTTE, an organisation that never came to peace talks from a position of weakness. Historically, the Tigers chose peace only by way of a breather and only after securing a major military victory. Previous peace offers by the Tigers came when the security forces were mulling over counter offensives to mitigate the LTTE’s military advantage.

If the LTTE Peace Secretariat chief’s statement portends an escalation of military activity, the Government last week, appeared to be readying to take the Tigers in their stronghold in the Wanni in the coming months.

Budget allocation

The massive Defence Ministry allocation in the 2008 budget underscores the Government’s military preparedness as well as its political will to militarily confront the LTTE and weaken, if not defeat it, in order to force the Tigers into peace talks.

The appropriation bill for 2008, which was tabled last week, has projected a whopping 166,447,000,000 rupees (approximately 166.447 billion rupees) as defence expenditure for the next year. This includes 13, 944, 70,00,000 rupees as recurrent expenditure and 27,00,00,00,000 rupees as capital expenditure.

This marks an increase of 19 per cent from 2007, though it comes as no surprise as the defence expenditure has been ascending ever since the break up of the north-east insurgency in the early eighties.

The latest hike in the defence expenditure came in the wake of a significant expansion of manpower in the security forces of Sri Lanka. The manpower of the Sri Lankan Forces went up by 74,619 personnel during the period of 2006 and 2007. A total of 31,582 ranks and file have been enlisted with the SLA during the said period. A total of 10891 personnel were recruited by the SLN.

A total of 4621 new personnel were recruited by the SLAF, which recorded 100 per cent increase in its cadre. The cadre of the police Special Task Force (STF) increased by 1496 personnel while a Civil Defence Force has been formulated bringing former home guards under a new umbrella institution. The total man power of the Civil Defence Forces stands at 34,900. It has been observed during the first two years of its rule that the Rajapaksa Administration has noticeably been generous towards the security forces. The Government, emboldened by the recent military successes, is likely to continue with its generosity though prices of essential commodities would skyrocket as a result of the soaring defence budget.

Yet, as far as the Sri Lankan Forces are concerned, the increased military expenditure has long been overdue. It was not long ago that aircraft were grounded without spare parts and a convoy of troop transport exposed to the extensive damage of claymore mine explosions due to the shortage of Armored Personnel Carriers(APC).

Key factors

The induction of new weapon systems and the upgrading of the existing systems coupled with greater freedom granted to the service commanders for planning and execution of military operation have been key ino the recent military victories on the battle front. But the Rajapaksa Administration has not been flawless in its strategy, with the mishandling of its public relations offensive eroding its image both locally and internationally. Dislodging Tamil lodge dwellers from Colombo, disappearances and abductions, name calling of foreign diplomats and witch hunting of media personnel have only aggravated the Government’s existing woes as it has locked horns with an uncooperative Opposition in Parliament and a ruthless guerrilla movement on the battle front.

That, however , is another story.

Lanka Logistics

There are further concerns about fiscal accountability as the Government earmarks a colossal sum for defence expenditure. The Government last year set up the Lanka Logistics and Technologies Ltd to procure goods and services to the security forces, thereby abolishing middlemen in the procurement of military supplies.

That is, of course, a salutary work of President Rajapaksa who could have observed from a sideline how arms dealers, middlemen and a cohort of the then political and military hierarchy made billions of rupees through crooked deals during the regime of his predecessor.

But, the Government’s action fell short of its desired effect and there is now, unfortunately, a smell of foul play. The Government’s sole arms procurer, Lanka Logistics and Technologies Ltd is not audited by the Auditor General’s Department, though it is a wholly state owned company. The Lanka Logistics and Technologies Ltd, which is a fully state owned limited liability company was formulated up to procure the defence supplies and services to the three forces and police.

The primary objective of the company which came into being on July 27, last year was described as “ the procurement of goods and services inclusive of research and development and allied activity” When President Mahinda Rajapaksa recommended the setting up of the company to the cabinet, he stressed that the company “would ensure complete transparency with regard to large transactions pertaining to procurement which time and again came under serious criticism by various agencies and the public.” However, such good intentions of the President have been observed in breach. The Lanka Logistics, now operates in a vacuum of financial accountability.

Though a wholly state owned company, it does not come under the purview of the Auditor General as it falls outside the scope of a ‘public corporation’ since it was formed under the Companies Act, No. 17 of 1982. The company however is audited by independent auditors. Under Article 154 (1) of the Constitution, ‘the Auditor General shall audit the accounts of all departments of Government, local authorities, public corporations and businesses or other undertakings vested in the Government under any written law.” Though under these constitutional proviso, Lanka Logistics and Technologies should be audited by the Auditor General, the law has been observed in the breach, and there is a necessity to strengthen the law.

This has been further highlighted as the Lanka Logistics is engaged in defence deals running into multi million US Dollars. The greater part of 27,00,00,00,000 rupees of capital expenditure earmarked for the next year would be spent through the Lanka Logistics Technologies Ltd.

Indeed, it has earlier been proposed that all public institutions, which fall directly and indirectly under Government ownership be brought under the purview of the Auditor General,” A draft bill has been prepared to this effect by the Auditor General’s Department which sent it to the Presidential Secretariat for its output. However, the LAKBIMAnEWS understands that the draft bill has been stalled at the Presidential Secretariat.

Defence Budget up by 19 per cent

According to the appropriation bill for 2008, the total projected recurrent expenditure for the Sri Lanka Army will be 6, 618, 80, 00,000 rupees. The total projected capital expenditure for the SLA will be 650, 00, 00,000 rupees.

The Sri Lanka Navy will receive 1, 917, 40, 00,000 rupees as recurrent expenditure and 800, 00, 00,000 rupees as capital expenditure. The total projected recurrent expenditure of the Sri Lanka Airforce will be 1, 356, 00, 00,000 rupees. The Total projected capital expenditure of the SLAF’ is 600, 00, 00,000 rupees.

The Police Department will receive 3,224,47,00,000 rupees as recurrent expenditure and 4,97,55,00,000 rupees as capital expenditure. The newly established Civil Defence Department , which is made up of former homeguards, will receive 655,50,00,000 rupees as recurrent expenditure and 50,00,00,000 rupees as capital expenditure. And the Minister of Defence, Public Security and Law and Order will receive 172,5300,000 rupees as recurrent expenditure and 102,45,00,000 rupees as capital expenditure.

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