Former President Chandrika Bandaranaike Kumaratunga has revealed that the previous government had obtained a sum of Rs. 15 billion as a commission from the Norochcholai Power Plant.
During a press conference convened at the Ministry of Finance on June 12, she said her statement is being said with absolute responsibility, and is neither a rumour nor gossip.
She said the companies came very happily thinking that they are being asked to review and to ask the progress and had said 50 percent of the cost of the project was asked as commission. She added that this was told to a higher-up Chinese person and that ‘obviously’ one by one they have spoken to the contractors.
The former president noted that this Norochcholai contractor had said such an amount cannot be given because profit is less than 25%.
She added: Therefore 3% can be given and they were told then get out so they went very insulted and for two and half years, the project was closed. That is all six projects were closed.
She said Nelum Pokuna was one such project, the Hambantota port was another and was signed by her. The Colombo Katunayake Expressway that was started by the government in the year 2000, was stopped in 2002 after the change in Government.
She further added that the project was re-started it in 2004 but it was half done, and then again in 2005 the project was signed on and started again. She added that when persons of the Finance Ministry went to China and pleaded with them to come and re-start the project and they had said no; and that the kind of commission cannot be paid and the government insulted the Chinese companies when it asked the companies to get out.
She further expressed that the Chinese are very proud people and they had said that they cannot come. and finally after pleading, they came back but they were not as good as the companies that were brought earlier and they were not companies that had the experience like the previous companies nor did they have the financial strength like the earlier companies. She remarked that it is known what happened thereafter to Norochcholai.
She also noted that power plant caught fire six times, it broke down about 10 times it is understood that it is not working properly but the most interesting thing that it was re-signed for US$ 510 million.
She added that the 240 became 510: “I signed at 280 million US dollars, so half of that will be 140, so 280 plus 140 is 420. Then why was it 510 because others had said ( Nat.. and they had added there rate) so it became 510 and who pays it? Our people so the commission was worth at that time – 15 billion rupees on Norochcholai alone”.
The former president further noted that the sovereign government has the right to break any agreement, but that this government does not want to act in a irresponsible manner because the previous regime did illegal things. She noted that a lot of these projects have been public looting, pillaging of public wealth and they have signed agreements without going through accepted tender procedures therefore its illegal, so it can very easily be cancelled.
She said, however, that the government is not doing that because it does not want to affect the companies that have come in and therefore are not to be blamed. She added that the government is renegotiating the terms trying to bring down the prices to the price that it should be.
Meanwhile, minister of Finance Ravi Karunanayake added that when the new government came in to power, debt was Rs. 7,100 billion and it had increased to Rs. 8.900 billion. He further added that what was evident in these projects was that they had been initiated without any funds and without cabinet approval.
He said today those who are with former president Mahinda Rajapaksa are saying that the government is bankrupt and that the government has no money; but that it can be said that the current situation is there is plenty of money.
