No Problem

Mar 10, 2009 (LBO) – Managers of Sri Lanka's state-run pension fund of private sector workers, under fire for investing funds for state purposes as a 'captive' source, have said the fund is operating well. In an interview, officials managing the EPF denied all suggestions of impropriety, conflict of interest, or coming under pressure to bid below weighted average yields at auctions.

It was also revealed that the Fund's governing law only requires 2.5 percent interest a year to be paid, while the central bank itself has driven inflation as high as 20 percent a year for many years.

Officials also see no need for a recommendation of the International Monetary Fund to have independent management to prevent the public debt office (which is a unit of the Central Bank) and the Treasury from browbeating EPF managers.

In the past, even private debt dealers have complained of coming under pressure from public debt department officials for 'sending rates up' at government securities auctions.

Here are excerpts of an interview Ishara M Gamage had with the Superintendent of EPF D Wasantha and his deputies Kalyani Gunathilake and Ebert Silva as the government prepares to amend the governing law of th