Nov 04, 2008 (LBO) – Sri Lanka’s Supreme Court has struck down a hidden budgetary fund that gave the island’s top treasury official power to circumvent the parliament and allocate money to any ministry, usurping parliamentary control over the public purse.
Court said the government was caught in a ‘debt trap’ where debt service was met by issuing further debt and the fact had been “kept away from the public domain” by the clause (2) of the appropriation bill.
“The staggering debt service payment of Rs 722 billion for the financial year 2009 reflect an accumulation of public debt over the past years that has resulted from irresponsible and reckless handling of public finance by the Treasury and a failure on the part of Parliament to exercise full control of public finance as mandated by Article 148 of the constitution,” court said.
Court also said the Treasury had been “irresponsible and reckless” in handling public finance and parliament had failed to exercise full control as required by the constitution.
Budget within Budget
The Supreme Court said the Secretary to the Treasury had operated a ‘budget’ of his o