The Parliamentary Committee on Public Enterprises (COPE) recently recommended that legal steps be taken to take over the Sri Lanka Institute of Information Technology (SLIIT), which previously belonged to the Lalith Athulathmudali Mahapola Higher Education Trust Fund as an institution administered by the fund, noting that its transformation into a fully private entity was carried out unlawfully.

Accordingly, COPE Chair Dr. Nishantha Samaraweera made this recommendation to the Secretary to the Ministry of Trade, Commerce, Food Security and Cooperative Development, K.A. Vimalenthirarajah, and Mahapola Trust Fund Chairperson retired Justice Vijith Kumara Malalgoda.

This recommendation was made during the meeting of the COPE held on 9 July.

During the meeting, it was extensively discussed that the property transfer, based on a Cabinet of Ministers decision in 2015, carried out with the consent of the minister at the time, was unlawful. It was also noted that the SLIIT had paid Rs. 408 million to the fund in this regard, and several Parliamentarians pointed out that it is concerning for an institution originally owned by the fund to pay such an amount back to the fund to gain ownership. Dr. Samaraweera emphasised that those responsible should be duly penalised and that such unlawful and fraudulent actions must be prevented from recurring. Minister of Trade, Commerce, Food Security and Cooperative Development Wasantha Samarasinghe, who holds the position of the ‘Founder Trustee’ of the fund, stated that such fraud will not be allowed to fade into obscurity over time, and assured that further investigations will be conducted accordingly.

A former official who opposed the transfer of ownership at the time informed the COPE that the institution, which had begun as a State entity with official representatives on the Board of Directors, was later illegally removed from State oversight due to greed stemming from the realisation that it had become a hub of substantial financial movement.

It was also discussed that some parties might attempt to foster a misconception that these investigations could cause the collapse of a university attended by a large number of students. Therefore, the COPE emphasised that while the SLIIT should continue its current operations, its administration should be returned to the fund. This would, in turn, enable a greater number of students to pursue degree programmes at a more affordable cost.

Attention was also drawn to the previous Government’s failure to properly fill key internal roles in the fund, including the Internal Auditor position. The COPE highlighted that having an inadequately staffed workforce in an institution that handles such a large amount of funds raises serious concerns about its efficiency.

Discussions also covered the current status of companies administered by the fund, including the National Wealth Corporation (Private) Limited and its subsidiary NatWealth Securities Ltd., both of which have been incurring losses. As such, the COPE decided that a commercial audit should be conducted, and that appropriate next steps be taken.

Further, attention was drawn to the potential to expand Mahapola Scholarships to a greater number of students eligible for university admission. The Chairperson of the fund stated that efforts are being made to achieve maximum equity in the use of interest and other income generated from the current capital of approximately Rs. 20 billion.

In addition, the COPE discussed issues including the appointment of Trade Exhibition Officers on a contractual basis for a two-year term in 2023, and a loss of Rs. 750 million to the fund due to the withdrawal of the selected Online Lottery Operator. The COPE directed that these matters also be subjected to a commercial audit and that necessary actions be taken accordingly.