As Sri Lankans prepare to celebrate the Sinhala and Tamil New Year on 14 April, there is a quiet but unmistakable shift in the national mood. What has traditionally been a season of renewal, abundance, and shared optimism is being overshadowed by the uncomfortable reality that this is, by almost every measure, the most expensive New Year in living memory. While the rituals remain unchanged – homes will be cleaned, hearths lit, and auspicious times observed – the economic context in which these traditions unfold has fundamentally altered.
For many households, this year’s celebration comes with a growing sense of strain. Prices of essential goods, which surged during the peak of the economic crisis, have stubbornly refused to retreat. Instead, they have settled at elevated levels, forming a new and punishing baseline. The latest wave of price increases has not replaced earlier shocks, but instead compounded them, making what was supposed to be temporary, permanent, and what was supposed to be the exception, the norm.
Now, yet another layer is being added. Electricity tariffs, already increased this month, are poised to rise further in the next quarter, with reports suggesting a proposed hike of around 15%. The justification offered is both technical and revealing: poor quality coal has led to a shortfall in power generation, forcing greater reliance on costly thermal energy. In other words, inefficiency and alleged malpractice upstream are now translating directly into higher costs downstream, costs that will ultimately be borne by the public, notwithstanding presidential assurances to the contrary.
It is against this backdrop that Sri Lanka finds itself confronting not just an economic burden, but a deepening governance crisis. For years, the country has struggled to uncover the full truth behind the 2019 Easter Sunday bombings, a tragedy that continues to haunt the national conscience, despite the occasional distraction of a book launch or two. Today, however, a different kind of question is emerging, one that is less dramatic in its immediate impact, but potentially more devastating in its cumulative effect. And that question is as to who is responsible for what is increasingly being described as the fraud that has caused the biggest financial loss in the country’s history: the substandard coal scandal.
The numbers alone are staggering. According to the latest report by the National Audit Office, losses from just nine out of an expected 25 coal shipments have already exceeded Rs. 2.24 billion. Individual shipments recorded losses ranging from Rs. 90 million to as high as Rs. 390 million. These are not marginal discrepancies; they represent systemic failure. And crucially, this is only partial accounting. If the pattern holds across all 25 shipments, the true scale of the loss could be exponentially higher.
The findings of the audit report paint a deeply troubling picture. The supplier at the centre of the controversy, Trident Chemphar, is alleged to have relied on test reports issued by a laboratory whose licence had been revoked. This alone raises serious questions about the integrity of the entire procurement process. More alarmingly, at the time the tender was issued, the company had not even been registered, despite explicit requirements that only fully registered suppliers could participate. Yet, bids from such entities were not only accepted but ultimately successful.
This cannot be considered a case of minor procedural lapses because the rules themselves were allegedly bent or deliberately ignored to favour a particular outcome. The situation becomes even more concerning when one considers that the laboratory initially designated to test the coal lacked proper accreditation, leading to the outsourcing of testing to another entity in Indonesia whose licence had already been cancelled. Despite this, shipments continued to be accompanied by test reports from this same unaccredited source.
Even when discrepancies emerged between these reports and data from the Lakvijaya Power Plant, available mechanisms for verification were reportedly not utilised. In other words, the system did not merely fail; it appears to have chosen not to correct itself even when warning signs became evident.
Compounding these irregularities is a failure in basic planning. During a critical 40-day window when coal unloading is most feasible in Norochcholai, no shipments were procured. Contractual provisions that would have allowed for cancellation in the event of non-delivery were not enforced. Instead, emergency procurement was initiated later, involving a supplier with an equally questionable track record of meeting required standards. What emerges is not just a pattern of mistakes, but of sustained and consequential mismanagement.
The political dimension of this crisis cannot be ignored. Serious allegations have been directed at Energy Minister Kumara Jayakody, including references to past controversies during his tenure at the Lanka Fertilizer Company in 2015. Critics point out that his appointment, despite a history of alleged misconduct, reflects a troubling continuity rather than a break from past practices, even casting aspersions on the appointing authority. What is regrettable is that the same leadership that promised accountability appears to be bending over backwards to shield those under scrutiny. Therefore, the people are entitled to ask as to where responsibility ultimately lies.
The President’s own remarks in Parliament last week have done little to dispel these concerns. His assertion that “no one tests coal by tasting it” was clearly intended as a rebuttal to criticism, but it has instead become emblematic of a broader failure. The issue was never about literal methods of testing; it was about whether proper procedures were followed and whether safeguards were deliberately bypassed. By framing the debate in such trivial terms, the Government risks appearing dismissive of legitimate concerns.
More importantly, the claim that the burden of these losses would not be passed onto the public is becoming increasingly difficult to reconcile with reality. Electricity tariffs have risen and are to rise again shortly. Unofficial power cuts have been reported across the island and increased reliance on diesel generation has contributed to higher fuel costs. The economic consequences of the coal issue have already cascaded through multiple sectors, quietly embedding themselves in the daily lives of citizens.
The environmental cost is another dimension that has yet to receive adequate attention. Burning substandard coal not only reduces efficiency but also increases emissions and accelerates wear on critical infrastructure. These are long-term costs that will not be captured in immediate financial calculations but will nonetheless be borne by the country in the years ahead.
When the broader economic context is considered, the timing could not be worse. According to projections by the Asian Development Bank, Sri Lanka’s economic growth is expected to moderate from 5% in 2025 to 4% in 2026, before a slight recovery to 4.2% in 2027. Inflation, which had briefly dipped into negative territory, is forecast to rise to 5.2%. These are not catastrophic figures, but they signal unnecessary pressure on a fragile recovery – one that is highly vulnerable to precisely the kind of governance failures now coming to light.
There is also a more subtle but equally important institutional concern. The multiple failed attempts to appoint politically aligned individuals to the position of auditor general have, in hindsight, raised serious questions about the NPP regime’s bona fides and independence of oversight mechanisms. That these attempts were unsuccessful may be a small relief, but the very fact that they were made underscores the stakes involved. Had such appointments gone through, it is entirely possible that the irregularities now being discussed would never have entered the public domain.
Ultimately, what is at stake is not just the resolution of a single scandal, but the credibility of an entire governing project. The current administration came to power on the solemn promise to dismantle entrenched systems of corruption and restore public trust. That promise resonated with a population weary of repeated betrayals. Today, however, the perception is shifting. The Government that was elected to catch rogues is finding itself accused of enabling them.
As the New Year dawns, many Sri Lankan households will make quiet adjustments like switching off lights, reducing consumption, and stretching already thin budgets. These are not merely personal choices; they are responses to systemic failures. And the question being asked is, in a country where governance lapses translate so directly into everyday hardship, who ultimately pays the price?
Accountability, if pursued sincerely and transparently, can begin to restore confidence. But that requires more than rhetoric. It requires action – credible investigations, institutional integrity, and a willingness to confront uncomfortable truths – the very things the NPP promised voters.
If those steps are not taken, the symbolism of this New Year will be hard to ignore. A festival meant to mark renewal may instead come to represent something else entirely: the normalisation of crisis, and the not-so-quiet erosion of trust in those entrusted to lead.