The Parliamentary Committee on Public Finance (COPF) has instructed officials to establish a legal framework for the Rs. 200 daily attendance allowance granted by the Government to estate workers.

Committee Chairperson Dr. Harsha de Silva emphasised the Committee has no objection to increasing the wages of estate workers. However, he stated the legal basis of the mechanism used to make this payment must be discussed. The payment is currently being made under a Memorandum of Understanding (MoU) entered into with private plantation companies, without being gazetted, and such an arrangement could be terminated at any time. Officials further noted the Rs. 200 allowance does not qualify for contributions to the Employees’ Provident Fund (EPF). 

Officials informed the MoU has been entered into with private plantation companies for a period of three years, and that once this period ends, a policy decision would be required if the Government intends to continue the payments. Dr. de Silva pointed out that it is inappropriate to utilise public funds to pay salaries in private institutions without proper financial discipline. Officials stated that the payment is being made as it has been approved by the Parliament under this year’s (2026) Budget. 

According to the approved Budget estimates, the allocation for this payment is categorised as a “development subsidy”. As development subsidies are generally intended to support increased production, the Deputy Secretary to the Treasury suggested that the payment would be more appropriately termed a “production incentive.” 

However, it was observed that neither the payments already made for January nor the relevant MoUs specify such a requirement in practice. The Committee also questioned whether excluding the Rs. 200 daily allowance from the EPF and Employees’ Trust Fund calculations is in compliance with the relevant laws. When questioned as to whether the Attorney General’s advice had been sought regarding the MoUs and related matters, officials stated that such advice had not been obtained. Accordingly, the Committee emphasised that these problematic areas must be rectified and that a proper legal basis should be established for the payment.