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Protect Workers’ Savings from the IMF Trap

T.M.R. Rasseedin
President, Ceylon Federation of Labour

It is clear that the IMF is behind the proposed Employees Pension Benefits Fund announcement by
the President as Minister of Finance when presenting the 2011 Budget in Parliament. This is a sequel
to the Article 4 Consultation that Sri Lanka has annually with the Executive Board of the IMF. At the
conclusion of these consultations Public Information Notice (PIN) No. 10/4 1 was issued by the
Board on 19/10/2010 which stated, inter-alia, that “…further efforts will be needed to put in place a
deposit insurance system , establish a regulatory framework for private sector pension …..”

There is no doubt that workers would welcome a pension scheme that will be of real benefit to them
in the evening of their lives. But the envisaged scheme has all the features of a captive fund to serve
the purposes of the government. The pension fund is to be based primarily with workers’ monies in
the ETF, EPF with an additional contribution of 2% from employer and employees, 10% of the profit
earned by the ETF, inactive EPF Accounts of those over 70 years and 2 % of the EPF balance and
10% of the gratuity of workers at the time of retirement. The quantum of pension a member would
receive is a paltry sum and such payment will not be for life. It is a deceptive device employed by the
government to meet its commitment to the IMF to raise the rate of savings in the country and claim
bringing about a corresponding increase in investment.

Today, trade unions are called upon to function as organisations expressing the views of the working
people on the larger problem of economic and social life. The offensive of global capital on
developing countries such as Sri Lanka is aimed at increasingly linking us to the global chain of
imperialist globalisation. The IMF, World Bank, and the WTO give our country little or no option to
decide our own affairs. In the wake of this process the working people and the society at large face
considerable challenges.

Labour has been made vulnerable due to increased pressure for the introduction of flexible labour
market policies that have an adverse impact on working people and trade unions. The threat to
secured employment is rising with employers increasingly resorting to diverse forms of contract
labour under cover of outsourcing resulting in denial of worker rights and benefits. The
superannuation funds of workers, until now invested in government securities, are being targeted by
capitalists supported by IMF and certain government circles, to be channeled to the risky stock
market, posing a serious threat to workers’ social security.

The present rigid wages policy in the private sector in the context of falling real wages, inflation and
rising prices has resulted in the pauperization of the working people. A recent study of the ILO has
brought out the startling figure of nearly one million belonging to the working poor in Sri Lanka.

The problem of rising prices, fundamental rights and freedom and the right to employment, law and
order, good governance and national unity are issues that concern the whole society and trade unions
being one of the few coherently organised and articulate groups in civil society should take centre
stage in promoting and espousing the common cause.

Things need to change. But the present state of our trade unions is not very encouraging. Only about
15% is organised. Our organizational strength need to be fortified so that it will serve as a pole of
attraction to the un-organised. We have been indulging in sectarian activities for too long dissipating
our strength in the process. The socio-economic changes that are taking place locally and the world
over in the world of work and society bring out the urgent need for unity of trade unions, of the
working people. Past attempts at trade union unity often collapsed due to partisan politics
overshadowing the need of the times.

It is time we cast away our petty differences and think afresh in the larger interests of the working
people and society.

Kelaniya, Lumpen Nationalism and the Left

Mahinda Ratnayake

Kelaniya is the birthplace of Vihara Maha Devi, the national heroine who, it is said, offered herself in
sacrifice to save the country from the wrath of the sea that flowed inland. There is an undisputed
bonding between Kelaniya and Magampura, in hoisting the Sinhala Buddhist State in Lanka. Perhaps
for that reason, President Rajapakse, who hails from Magampura, chose another from the same area
as his representative for Kelaniya.

State patronage for lumpen activities

This son from Magampura proved himself qualified to be the President’s nominee for Kelaniya,
with many infamous heroic feats. The first was his attack on the public rally that was organised
in Nugegoda on 08 January 2007 to urge for a political solution to the ethnic issue. His rowdy
tantrums thrown at the SL Rupavahini Corporation for not airing his lewd speech attacking
Mangala Samaraweera at the opening of the Matara new bridge, is public knowledge. Thereafter
his many “heroic” deeds like attacks on Sirasa TV station and its media persons, roping a
Samurdhi officer to a tree as punishment, gave him a competitive advantage in getting perks,
privileges and promotions.
The “patriotic” insanity that was played out at the Nugegoda Super market by lumpens and
“patriots” together, was evidently approved by the President and was perhaps a forerunner in
establishing a unique “law” and “disorder” situation in Kelaniya. Meat and fish for meals in
Kelaniya was decided on this “law”. Home gardening became compulsory in Kelaniya under this
“law”. Eatables in Kelaniya were decided on this “patriotic law”. Sale and consumption of liquor
also came under this same “law”.

That aside, with this patriotism entering the fish market, their jungle law has now become a
problem. This is also no external intrusion, but one due to a breakdown of the internal order of
the fish market. This breakdown of internal order has not only made extortions and their
infighting a big issue, it has also made the ordinary consumer unsafe and very insecure. Even a
well knitted group of robbers have amongst them the discipline to share the loot, ethically.

The breakdown of the internal order is not due to other trivia, but because pseudo patriotism in
law and order has no ethics to base itself. The President now pretends he is unaware of these
issues and has got his brother to intervene in the fish market affairs, with the Special Task Force.
He thus wants to project himself as wholly innocent of such thuggery.

Though this would look clean for the ordinary citizen, this again is another aspect of the same
pseudo patriotism of this regime. A Co-ordinating Secretary of the modern Dutu Gemunu, is now
under remand for having tried to extort five hundred thousand rupees from a Tamil businessman.
He was in the company of two police personnel when arrested at the scene of extortion. With
that, keeping this modern Dutu Gemunu who patronise all this in the cabinet, is the wonder of
Sri Lanka.

The “Left” and the lumpen class

The lumpen class has become a formidable group in our societies, as a product of global
capitalism. It is amply reflected with increased numbers of them getting elected to parliament
today. Beyond that, it is no secret, they have become a very influential force in winning the
support of the Executive too.

There can be no grumbling in a social segment securing representation within democratic

institutions. It was the “Left” that provided space for the lumpen class in the past. The marked
difference then was that the “Left” was able to lead them into a proletarian life, with a good
understanding of politics.

Thus Reggie Mendis (Reggie Aiya) an undisputed underworld leader in the Fort-Pettah area,
transformed himself to be a Secretary of the Marxist Study Circle in the Trotskyite LSSP, with
party guidance. With such political discipline, the underworld leaders were able to handle their
own underworld issues with a humanely sensitive approach.

What needs to be understood is the danger that accompanies the deployment of armed forces to
quell conflicts, after allowing lumpen figures to play sordid roles as patriots. The lesson that
should be learnt from the LSSP experience in the past is that, marginalised social elements can
be guided into discipline and productive social life. That is only possible for “Left” political
parties with a working class perspective. The “Left” today has to be more committed, determined
and skilled in “Marxist” applications than in the past, for such social intervention.

The Miracle of Selling the Country

Lal Wijenayake, Attorney-at-Law
Though the government proclaims that under Mahinda Chinthanaya privatization of state
assets has not taken place and that it is not the policy to privatize state assets, within the last year the
disposition of land owned by the state to foreigners has taken place at an unprecedented scale. It is
significant that what is disposed to foreigners are some of the most valuable land in the country. The
sale of about 10 acres of the most valuable land occupied at Galle Face by the Army to the Hong
Kong based company Shangri La for a hotel complex, the sale of two isles in the Kalpitiya area to
foreign companies, the proposed sale of part of Beira lake and the land that was owned by the
Colombo Commercial Company to a foreign company and the large scale of land in the eastern coast
and its vicinity to foreigners for hotel projects has according to reports taken place recently. Further
it is revealed from statements made by persons in authority, that the land now occupied by residents
of Colombo in unauthorized structures and from which they are being evicted unlawfully without
recourse to the legal process are to be disposed to foreign companies for development. These
transactions are taking place as if the authorities are dealing with their private property without any
transparency and this has caused suspicion that large scale malpractices has taken place. It is also
revealed that legislation is to be introduced shortly to remove existing legal impediments for the sale
of land to foreigners in order to facilitate this process. If this process is allowed to continue, before
long the most valuable land in the country will be owned by foreigners. The silence of the Hela
Urumaya and the National Patriotic Front in respect of these developments has exposed the real
meaning of their much proclaimed patriotism and their vow to sacrifice their life to safeguard the
motherland. This process is much more dangerous and damaging than the sale of public business
enterprises which was witnessed under the previous regimes. It is no secret that there are covert
moves to privatize public enterprises like the CEB and the CPC. Public statements made by
authorities show that moves are afoot to privatize water resources in the name of water management,
including natural water resources and large scale irrigation projects. It is no secret these moves are at
the behest of the IMF. The process of neo liberalization is taking place under Mahinda Chinthanaya
today than we have witnessed under any regime in the past.

The Advisory Panel Report

The report released by Ban Ki-moon’s advisory panel has not shocked Sri Lankans; it was expected.
Most of these allegations were known before. The Government has been denying them and also
“prepared” the people for an adverse report. Tamils have been insisting in private that the allegations
are true. The report is as scathing about the war crimes of the Tigers as it is about the behaviour of
the state’s forces.

Denial on the part of the Government is not surprising. The state of denial among many Sinhalese is
also not unusual. To this day, the Japanese people are in psychological denial of the massacres and
brutality of the Japanese Army against civilians in China and South East Asia. Most Americans still
hide from the truth about the carpet bombing of civilians in Vietnam and Laos that left tens of
thousands dead and maimed. Serbians, Bosnians Croatians and Kosovars in the former Yugoslavia
are bitter about the war crimes of the others but cannot accept that their own forces acted similarly.
Similarly, many Tamils simply refuse to accept human rights violations by the LTTE.

It is necessary now for Sri Lankans to remain calm and to consider with a clear mind all the material
in the report, the denials by the Government as well as the LTTE, and the large amount of other
material that has been surfacing. Right understanding is what we need. People must not allow
themselves to be incited to irrational emotions. We caution the Government against using the report
to take the country further down the nationalist road. Instead, it must meet the criticism and set up
credible mechanisms to probe into the allegations. It must also take steps to alleviate the immediate
problems of the Tamils and place proposals for a political solution to the ethnic issue without further

Anik Pituwa Editors

Hereafter, Anik Pituwa will appear in

the Ravaya of the first Sunday of each

The next issue is on 05 June.


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