Privatisation: Good servant bad master

Petroleum Resources Minister A.H.M. Fowzie was heard lambasting the Lanka Indian Oil Company (LIOC) in Parliament this week for raising its market price of diesel. As a result, Minister Fowzie said, consumers were flocking to Ceylon Petroleum Corporation (CPC) outlets where diesel is subsidized, thereby increasing the Corporation’s already substantial losses.

The government is compelled to act in the national interest, Fowzie lamented, threatening to take over LIOC outlets if the company did not mend its ways.

We do not propose to discuss this particular bone of contention in these columns. But, where have we heard all this before? Wasn’t it only a few months ago that we had Consumer Affairs Minister Bandula Gunawardena raving and ranting against the Shell Gas Company, again over the market price of the domestic gas cylinder?

And, didn’t we hear similar rumblings against the management of SriLankan Airlines by Emirates? That dispute did not see a resolution, resulting in a parting of ways, with control of the national carrier reverting to local hands.

Prior to that, the privatised telecommunications giant, Sri Lanka Telecom (SLT) also had a pricing war, which ultimately went to the courts of law, with SLT being ordered to reduce tariffs and pay refunds to customers.

The concept of privatising State ventures was introduced to this country by J.R. Jayewardene, under his pledge to establish an ‘open’ economy. Jayewardene famously said, ‘let the robber barons come’ and it was a landmark event in the country’s finances, marking an about turn from S.W.R.D. Bandaranaike’s nationalisation drive in the late fifties.

What Jayewardene began, his successors continued. Ranasinghe Premadasa was instrumental in handing over estates in the Plantation sector to private companies in a reversal of Sirima Bandaranaike’s land reform policies. And the Bandaranaikes’ progeny, Chandrika Kumaratunge did nothing to change policies, speaking instead of an ‘open economy with a human face’.

So, privatisation is here to stay-unless of course the Janatha Vimukthi Peramuna comes into power and cleanses the country of all the ‘vijathika balavega’ that it speaks so eloquently of. Right now though, that is quite a remote possibility.
If privatisation is the name of the game and, if it is to be all pervasive and extend into vital service sectors such as telecommunications, airlines, fuel and power generation, then it is incumbent upon the government to ensure that adequate safeguards are put in place to protect the general public.

That is, after all, a sine qua non, since any dispute in a vital sector-such as the dispute over fuel pricing, which Minister Fowzie is encountering now-will only boomerang on the government in power, with disastrous political consequences.
It is not that Sri Lanka does not have successful privatisation stories. The privatisation of the Plantations -a massive exercise where large areas of land were sold to a multitude of private sector companies-was opposed at the time by many but now, few would argue that their productivity is retained only because this was done in a timely and transparent manner.

Even the privatisation of telecommunications-barring those hiccups with the SLT-has led to remarkable growth in the industry, with many private sector players in the market. And the winner in the face of more competition is ultimately the consumer.

Perhaps that is the moral of the story. If privatisation is to be embarked upon for a vital sector, adequate provision has to be made to protect the consumer and it is the duty of the government to do so. Another strategy to ensure a level playing field would be to have more than one player from the private sector in the fray.

In privatising some sectors, this government - and those before it - have missed a trick or two. And if that trend is allowed to continue, it is the government that will have to pay - not only in rupees and cents but also at the next election.

Back to school

Yet another ministerial brat is in the news for all the wrong reasons. And, this time around, the Minister, Keheliya Rambukwella is the focus of attention, because he is alleged to have visited the school, Royal College, and allegedly threatened the Principal with a transfer, if disciplinary action was taken against his offspring.

Thankfully, we hear that President Mahinda Rajapaksa himself has intervened and requested the Principal to stand by his decision to punish Rambukwella (Jnr.). But the larger issue of political interfere nce, intimidation and impunity remains unanswered.

Rambukwella is no Mervyn Silva, and we do not expect him to behave in a like manner. He is a learned man. He is also the public face of the Rajapaksa regime, because he is its spokesman on Defence matters. If so, he must act like one.

To barge into a school and allegedly threaten the Principal with a transfer, because his son was punished, would be the work of Kurunduwattey Choppey; not Keheliya Rambukwella, senior minister, Parliamentarian and government spokesman.

President Rajapaksa has intervened to restore some sanity into the proceedings and that should be commended, but shouldn’t Rambukwella be reprimanded as well? Aren’t his alleged actions worse than his son’s? Wouldn’t such an incident in most other countries result in the resignation of the minister?

We can only wait with bated breath for such consequences. And, until such time, may we commend Abraham’s Lincoln’s letter to his son’s teacher, as reading material for the learned Cabinet minister:

“He will have to learn, I know, that all men are not just, all men are not true.
But teach him also that for every scoundrel there is a hero; that for every selfish Politician, there is a dedicated leader…. In the school teach him it is far honourable to fail than to cheat...”