Plain-sailing powers for SriLankan bosses

Some heads of state-financed enterprises have acted even beyond powers enjoyed by the President, the Prime Minister or the Members of the Cabinet, according to documents seen by the Sunday Times.

One such instance is the "premature termination of a Lease Agreement" for the purchase of A 350-900 aircraft by SriLankan Airlines, the national carrier - a matter which even surfaced at the inquiries conducted by the Commission headed by retired Supreme Court Judge Anil Gooneratne.

The decision to pay US$ 98 million compensation to Aercap as penalty for early cancellation has been made by SriLankan Airlines’ then Chief Executive Officer (CEO) Kapila Chandrasena without approval either by the Cabinet of Ministers or the Attorney General.

According to a letter written to SriLankan Airlines’ then Chairman Ajit Dias by Public Enterprise Development Ministry Secretary R. Hewavitharana, even though the Cabinet and the former Cabinet Committee on Economic Management ( CCEM) "categorically requested my involvement in this transaction leading to the entering of the Agreement, I was never requested to be a member..."

Mr Hewavitharana's letter prompted four directors of SriLankan Airlines at that time -- R. C. de Silva, J. M. S. Britto, R. S. Jayawardena and H.R. Balapatabendi -- to write to the then SriLankan Airlines Chairman, Mr Dias.

This is what the four directors said: "We the undersigned non- executive Board Members have done our own inquiries on the facts made available to us, and collectively conclude that the Management appears to have clearly exceeded the Board Mandate and unnecessarily risked placing the company to legal claims."

They requested that the Ministry of Public Enterprises and the Attorney General to appoint an independent panel to "confirm the findings." Nothing happened.

However, during late last year's unconstitutional government, Kapila Chandrasena was named Chairman of SriLankan Airlines. A wave of protests to then Premier Mahinda Rajapaksa led to the cancellation of the move within hours of his appointment.