Sri Lanka: Basil Rajapaksa is not Vindicated! Take the Australian Example!

In a bizarre twist to these cases in November 2020, the Attorney General’s Department withdrew the first case on ‘Isurumath Nivahana’ agreeing with the defense that Divineguma funds might not be considered as public funds as they belong to the 1.2 million Divineguma beneficiaries. This was like the well-known ‘Sathasivam’ case!

by Dr Laksiri Fernando 

It might not be the case in America. However in Australia, if the image of a politician is tarnished with corruption allegations, business deals or any other abuses, that person should not be appointed as a Minister, or he/she should resign when those are pointed out or investigated. Australia is undoubtedly a more mature and a reliable democracy than America. Especially in the case of public funds or money earned through dubious means, even in the private sector, democracy should be shielded from those who are involved in corruption and misdeeds.   

Sri Lanka had relatively strong democratic traditionsin 1950s and even in 1960s. When the Thalagodapitiya Commission (1959) revealed some corruption allegations against M. P. deZoysa and D. B. Monnekulame they resigned from their ministries and from Parliament. Of course there were others who were more adamant, and they had to be punished/censured through by-partisan procedures in Parliament. The Left and the minority parties were most principled at that time on corruption issues. More than the Parliament, independent anti-corruption commissions might be best like in Australia. 

In Sri Lanka, those anti-corruption traditions have become pathetically eroded thereafter due to various reasons such as (1) the instability in the constitutional/legal system, (2) establishment of a dubious economic system in the name of an ‘open economy,’ (3) ambiguous business deals nationally and internationally, (4) erosion of political party discipline, (5) emergence of opportunistic parties and interest groups, and (6) the decline of ethics and values in the education system in general. (7) Religious leaders and organizations also may be responsible for this deteriorating situation. 

Australian Example

Previously, I have written on the Australian example (‘A Bottle of Wine Throws a Premier Out!’). It was a simple failure to declare a bottle of wine received by the New South Wales Premier, Barry O’Farrell, in 2011 from a business person. When it became revealed to the Independent Commission Against Corruption (ICAC) in 2014, the Premier gracefully resigned from the position. It was just a potential issue of corruption and not even corruption per se.  

Of course there are persons in Australia who are adamant and deny any wrong doing and they are eventually punished through the revelations before the independent commission/s. That is possible because the commissions are truly independent and adhered to high standards. This is apparently not the case in Sri Lanka or unfortunately even in the Attorney General’s Department. Eddie Obeid and Ian Macdonald are two recent cases in NSW. ‘A List of Australian politicians convicted of crimes’ can be obtained from Wikipedia.  

Even last month the NSW Premier, Ms. Gladys Berejiklian, had to resign from her position, when ICAC started investigating whether she had breached ‘public trust’ when she awarded special grants to the electorate, Waga Waga, represented by her undeclared ‘secret lover.’Previously, the person in question, MP Daryl Maguire, had to admit and resign involved in some business deals and ‘seeking’ payment over a property deal. 

Even in Australia, there are grants to electorates and community organizations. However, those should not be distributed based on party preferences or political favoritism, whoever in power. It is quite doubtful whether this is the case in Sri Lanka. Leading to elections, those who are in power usually misuse public funds to win those elections and to favor their constituencies in order obtain votes. This is in addition to various business deals, favoritism,and other corrupt practices. These are terrible distortions in democracy. 

Basil Rajapaksa Case

There have been allegations and counter allegations between political parties and governments on various fraud and corruption issues in Sri Lanka. There are over a dozen of people who are allegedly involved in corruption who are in the present government and in the opposition. The allegations against the present Minister of Finance, Basil Rajapaksa, is highlighted in this article because the whole country’s economic policies, financial management, public administration, international relations and future of the country would be affected by his alleged misdeeds and lack of integrity. Even he is ‘innocent’ his image will encourage the others to involve in corruption and fraud.  

It is true that most of the allegations of corruption of Basil Rajapaksa emerged under the UNP/SLFP government between 2015 and 2019. However the indictments were filed under the authority of the Attorney General’s Department and the actions or arrests by the Financial Crimes Investigation Division (FCID). 

One of the first scandals was the Malwana house and property deal. It was alleged that the property was purchased in November 2010 under undeclared and laundered money for Rs. 64 million, but worth Rs. 208 million. The name of Thirakumar Nadesanalso was propped up as the actual purchaser as from the Pandora’s Box. However, they refused to accept the ownership of the property, an implicit acceptance of some guilt. By this time, Basil Rajapaksa was the Minister of Economic Development! 

Then there were two other instances where Basil Rajapaksa, with officials under him, allegedly utilized public funds to support the election campaign leading to the Presidential elections in January 2015. This pattern of public funds being utilized for election purposes under different administrations, perhaps have a long history which have not properly been investigated.  

Of course it was the newly formed FCID which questioned and arrested him for the misuse of public funds. But it was the Attorney General who filed the indictments against him and his officials in the Colombo High Court. The role of the FCID then and thereafter was questionable as the efforts had some apparent political motives. However, could we say the same to the AG or AG’s Department? Then AG is in fact the present Chief Justice of the Supreme Court. 

Divineguma Funds 

The first case was about Divineguma funds being utilized for housing grants for political purposes under a dubious program (Isurumath Nivahana). The amount utilized was Rs. 2,992 million. It is now and then said that the disbursement of funds were stopped by the Election Commissioner after the official start of the election campaign. That itself proves the allegation. 

The funds were obviously utilized for election campaign purposes. Just because one is a Minister, he or she should not have the authority to transfer or utilize funds arbitrarily. These are the questions, the dates included, and to whom any funds were given, that should have been investigated by an independent commission like the ICAC in Australia, not just legal questions in a high court. These are moral and ethical matters that politicians should abide by in a working democracy. 

The second case was about again Divineguma funds allegedly being utilized to purchase GI pipes to be distributed to Provincial Councils, and to the people through them before the Presidential elections in January 2015 again obviously for political purposes. The amount involved was Rs. 36.5 million. There were other allegations and cases but the above three are sufficient to raised the issue that the politicians and ministers should be free from corruption and dubious financial matters, if Sri Lanka’s democracy to be sustained and serve the people without discrimination to political party, ethnicity or any other distinction.   

Acquittal of Rajapaksa? 

In a bizarre twist to these cases in November 2020, the Attorney General’s Department withdrew the first case on ‘Isurumath Nivahana’ agreeing with the defense that Divineguma funds might not be considered as public funds as they belong to the 1.2 million Divineguma beneficiaries. This was like the well-known ‘Sathasivam’ case! The argument itself admits the culpability of the misuse of funds, public or otherwise, without proper approval of the Treasury. 

It is on the same premise, having referred to the previous case, that the AG’s Department has withdrawn the case of GI pipes this month (Rs. 36.5 million at stake) without any proper hearing. It is not the High Court that has acquitted Basil Rajapaksa, but the Attorney General! Can the Ministers or Finance Ministers arbitrarily use or transfer funds from one purpose to the other without a transparent procedure or treasury approval? The purpose was obviously election and political. If that is the case, Sri Lanka undoubtedly is a bizarre democracy.  

What is the definition of public funds? It appears that the AG Department’s legal pundits do not have a proper idea or definition. The following is what given in Australia by the Taxation Office. 

“Public funds fall under two types: (a) funds established and controlled by government or government authorities and (b) funds to which the public is invited to contribute and in fact contribute. A Public fund may be established as a separate entity, for example under an instrument of trust, or as part of a sponsoring organization.” 

Under this definition, particularly under (b), Divineguma funds are definitely public funds. Those funds are not Basil Rajapaksa’s private funds. Some may refuse the definition by saying it is an Australian definition,and not a Sri Lankan one! But this is a common definition, and we are living in on the same planet inheriting hopefully a common democratic tradition.  


Like Barry O’Farrell and now Gladys Berejiklian in Australia, Basil Rajapaksa should resign. His image is tarnished using public funds for political purposes. He is particularly not suitable for the position of the Minister of Finance. If he is the Minister in charge of the whole country’s financial and economic matters, what justice that people could expect? He is also in charge of various financial transactions and trade deals with foreign companies and countries. What transparency people could expect from him? 

His appointment as the Minister of Finance was utterly wrong. If not by a brother, who would comfortably appoint him for this position? If he remains as the Minister of Finance, he would again and again would commit similar evils during the future elections or even otherwise. As far as he remains as a Minister, of course among others, democracy in Sri Lanka would be in peril. 

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