Oct 02, 2012 (LBO) – An interim report on state finances presented to parliament is not responsive to Sri Lanka’s fiscal management responsibility law and lacks key information, a legislator has said. Harsha de Silva, an opposition legislator who is an economist, has told parliament that in Sri Lanka’s mid-year fiscal report covering fiscal operations of the first four months, only cash flows were presented according to the law.
Sri Lanka’s Fiscal Management Responsibility Law was brought to parliament in a bid to check runaway state expenditure and stabilize the economy.
Sri Lanka’s large budget deficits and an ever expanding public sector have pushed up interest rates and the national debt, while slowing growth.
At the time the law was brought, the country had a national debt of over 100 percent of estimated gross domestic product. It has since fallen to about 80 percent of GDP.
The law was aimed at bringing the budget deficit down to 5.0 percent of gross domestic product by 2006, a goal that the country is yet to reach.
De Silva said the law required the finance ministry to present to parliament estimates of taxes and the actual taxes collected and the estimated expenses a