• BY Buddhika Samaraweera

The Ceylon Teachers’ Union (CTU) President, Priyantha Fernando, has lodged a complaint with the Cooperative Development Department and the Audit Services Commission over the alleged misuse of member funds and financial irregularities at the Education Development Cooperative Society (EDCS).

The complaint, which was seen by The Daily Morning, states that, as an institution operating with members’ funds, the administration, supervision, auditing, and overall management of the EDCS fall under the authority of the Cooperative Commissioner. However, Fernando alleged the group currently exercising administrative power within the Institution has been using its funds at its discretion. "Membership fees have been arbitrarily increased to Rs. 955, and members have complained they have not received dividends for several years. Cooperative funds have also been utilised for political events, activities, and programmes. This means that member contributions are being used for purposes unrelated to cooperative objectives and members' welfare," he claimed.

The complaint also drew attention to the expenditure incurred for a scholarship award ceremony held on 31 January. "More than Rs. 5 million from member funds was spent on the event, with services obtained at high costs without calling for quotations. The expenses include over Rs. 1.05 million for meals, Rs. 805,000 for refreshments, Rs. 890,000 for venue facilities, approximately Rs. 500,000 for chairs, and nearly Rs. 1.6 million for promotional activities." Fernando, who spoke to The Daily Morning, said that if the scholarship allocations had been credited directly to the beneficiaries’ accounts instead of being spent on the said ceremony, the Rs. 5 million-sum could have remained as assets of the EDCS and recipients would have benefited without incurring personal travel expenses.

He further claimed that disciplinary action was taken against two employees attached to the relevant divisions after the alleged irregularities came to light, and that three other employees had been transferred. However, he charged that these measures appeared to target individuals who exposed wrongdoing rather than those responsible.

"The EDCS continues to recruit staff despite an existing surplus workforce. More than 200 casual employees have been recruited, with some branch offices reportedly employing more staff than required. Employees are assigned to non-official duties, including political activities, instead of their regular responsibilities. Individuals previously removed from financial institutions over financial fraud have also been appointed to senior positions within the EDCS." He added that buildings for branch offices had been purchased without following tender procedures and that funds had been used to acquire land at several locations under property acquisition programmes. "A building has been rented for the Maharagama branch at a monthly rental of Rs. 650,000, with renovation work currently underway. Positions such as Technical Consultant, Computer Officer, and Board Consultant have been created, with individuals recruited outside the established procedures."

He said that more than 200,000 members have been affected by the alleged irregularities through the loss of member benefits, increased membership fees, and limited access to loan facilities. He requested the said Department and the said Commission to conduct an immediate formal investigation into the management and financial operations of the EDCS.

Attempts by The Daily Morning to contact the EDCS Chairperson and Secretary for comment proved unsuccessful, as the office informed that both officials were attending a funeral at the time of inquiry.