Ceylon Today Editorial

Act against CKDu before it’s too late

02 November 2016

The Chronic Kidney Disease of unknown aetiology (CKDu) has become one of the most prevalent diseases in the country, with patients being identified in over 12 districts. Although many a research material has been published and has made the limelight in public, it is rarely that the matter is given enough attention.

Recently, the Ministry of Health announced that the Chinese Government has promised to assist Sri Lanka to find reasons for the disease and its unknown aetiology in order to find a cure. This definitely is a welcome point in the matter as it is about time that our own government paid attention to serious research and development, which is something we lack as a country. If we are to become a developing country, that is taken seriously by other nations, research and development in any given field, especially medical, is a must. However, it is also a field where we lack in.

Sri Lanka is mostly dependent on outside research material. For example, for mental health research Sri Lanka obtains it mostly from the Indian National Institute of Mental Health and Neurosciences. Likewise, other research materials that are put to use (rarely) are from other countries.

It is not because we do not have our own researchers, scientists and scientific analysts. This is because we do not pay much attention to the contributions they make in form of scientific research. For example, as mentioned before, many papers have researched, analysed, dissected and thoroughly investigated into the origins of the chronic kidney disease that has run rampant in the country. Many a person has sought answers in order to find a cure for the disease. Yet, our authorities simply don't pay any attention to them.

When our local intelligence has proven more than capable in studying a disease, it is sad the government is being more and more dependent on other countries.

China is expected to assist Sri Lanka in determining the causes of the chronic kidney disease, find cures, develop the skills of health ministry officials, provide equipment that will help identify the symptoms at an early stage and to build a database on identified and diagnosed patients.

A team from China is due to arrive in Sri Lanka in December to help implement this agreement. A Memorandum of Understanding was also signed between Minister of Health Dr. Rajitha Senaratne and Vice President of Chinese Academy of Sciences, Prof. Zhongli Ding.

Although this is commendable, the government should pay more attention to taking into consideration the local academics. Obtaining the assistance from China might not be a bad thing entirely, if it is implemented properly to strengthen the medical research and development facilities and for the overall improvement of our health care system.

President Maithripala Sirisena, being the vocal hero of the farmers, has always been vocal about the disease and the havoc it has wreaked upon the agriculture sector of the country -- with the main cause of the disease speculated to be chemical fertilizer use. It is good that the President has taken steps to show that he is not all talk and no work; the Memorandum with China to assist in medical research shows that at least he's doing something. But one can also argue whether this is enough and whether this surmounts all the talk he has done.

Obviously not and much more can be done with regards to the matter. After all, it is a deadly disease that is not only threatening our population, but also threatens our economic.

Imagine a scenario where the land has become unusable to the unregulated use of chemical fertilizer and weedicide, farmers and their legacy of a diseased generation who have been rendered useless for work due to their deteriorating health. It will surely be the end of our country.

At the end it will not be the forces of international conspiracies or conflict instigated by extremism and racism that will destroy our country – it will be our ignorance of a singular disease that we allowed to wreak havoc. This should not come to pass.

Daily News Editorial

Making VAT work

02 November 2016

They say that only two things are really unavoidable in life – death and taxes. Practically all countries levy taxes and it is no exaggeration to say that taxes make our modern lives possible. From education to transport, most public services are funded by money raised from direct and indirect taxes.

There are many tax systems in use throughout the world and Value Added Tax (VAT) is one of the most prevalent. A tax levied on goods and services, VAT is applicable to everyone across the board, being an indirect tax. Sri Lanka initially had the Goods and Services Tax (GST), a version of VAT, before VAT became entrenched in the law books and the economy. VAT in Sri Lanka had ranged from 10 percent to 20 percent, though the latter rate has now been forgotten by most commentators who decry the new 15 percent rate. Some countries have an even higher VAT rate.

VAT remained at 11 percent until a few months ago when the Government raised it to 15 percent, but due to technical and procedural faults in the implementation, the Supreme Court gave a verdict that it should be put on hold until the VAT Bill can be presented properly. Unlike on the other occasions when VAT was imposed, there was an intense debate on VAT (and taxation in general) when the Government announced the 15 percent VAT rate. Now the Government has corrected all the technicalities in the Bill, which the Supreme Court has decided is not inconsistent with the Constitution and presented it to Parliament last week. The Bill was duly passed in Parliament and the new VAT rate of 15 percent became effective from yesterday.

The Government argued that VAT was necessary to recover at least some of the massive debts incurred by the Mahinda Rajapaksa regime of 2005-2015. While it is naïve to think that VAT alone (an anticipated additional revenue of Rs.10 billion per year) could help offset the Rs. 9.5 trillion debt left behind by that regime, the higher rate will help the Government to earn more revenue for essential services.

There is another reason why indirect taxes such as VAT have gained prominence in Sri Lanka over direct taxes such as Income Tax. The reality is that less than one million out 20 million Sri Lankans (and 13 million in the employable age group) pay any form of income tax. There are less than 700,000 tax files at the Inland Revenue Department (IRD). This situation is simply untenable – we need at least two million direct tax payers. In most regional countries, at least 10 percent of the population pays direct taxes. However, as a start the IRD is looking at having least 1.4 million taxpayers in the short term. If there are more direct tax payers, it will indeed be possible to lessen our dependence on indirect taxes one day.

There are both merits and demerits in the new VAT rate. No one will grudge imposing the VAT on alcohol and tobacco, two vices that have a huge health and social cost. The Government has also exempted 82 varieties of goods and services from VAT. Households will be relieved to know that many day to day items are not subjected to VAT. Moreover, by exempting items such as solar power equipment and computers, the Government has taken future trends into account.

There are several product and service categories on which the increased VAT will be levied for the first time, which has led to a raging debate in the media and society. Telecom services and health services are among the most prominent among them. It is debatable whether it is possible for telcos to earn any more by way of taxes in these days of Wi-Fi, Viber and What’s App. Higher taxes might compel users to bypass the traditional networks and use these cloud-based services over Wi-Fi where available which may actually lead to a loss of revenue.

The Government has listened to public opinion and decided not to levy VAT on pharmaceuticals (the prices of some varieties have already decreased following a recent Government decision), surgeries, diagnostic tests and dialysis. Channeling of doctors and in-patient room charges will now be liable for VAT, which will see a rise in hospital bills. While outpatient treatment (OPD) has apparently been excluded from VAT, some ambiguity remains because channeling can sometimes be part of OPD treatment. In any case, the Government should reconsider the VAT imposed on the health sector. After all, a large number of poor and middle class patients also obtain the services of private medical establishments and they will be affected by the new measure.

Now that VAT is here to stay, we hope that the Government will make maximum use of the funds obtained through it. For example, more Government hospitals can be developed from the VAT imposed on private sector health facilities. It is imperative to use VAT and other taxes to balance the interests of both the public and the economy.

The Island Editorial

EPF robbery: TUs  in slumber

02 November 2016

 

The UNP members of the Committee on Public Enterprises (COPE) are now doing their damnedest to have the public believe that they really want criminal charges brought against those responsible for the Treasury bond frauds. Having made a vain attempt to cover up the bond scam and then gone all out to dilute the COPE report thereon they are now accusing COPE Chairman Sunil Handunnetti of having handled the bond thieves with kid gloves! They seem to have taken the discerning public for suckers.

True, the COPE report is not as damning as it should have been, but Handunnetti deserves public plaudits for his efforts, given the UNP members’ hostility he had to contend with. Auditor General Gamini Wijesinghe has done the public service proud by standing up to a bunch of arrogant parliamentarians who resorted to intimidation and abuse in a bid to make him fall in line. He has demonstrated he is made of sterner stuff.

The government has its political opponents including monks arrested and remanded for offences such as misusing one or two state-owned vehicles each or keeping baby jumbos in temples. It will have to ensure that the same treatment is meted out to former Central Bank Governor Arjuna Mahendran held responsible by the COPE for the bond frauds if he ever returns to the country. It will be interesting to see whether the plethora of civil society organisations which condemned the previous regime—and rightly so—for having corrupt elements within its ranks, will try equally hard to have bond thieves arrested. Difficult as it may be for them to come to terms with the fact that their gods have feet of clay, they will only make a mockery of their anti-corruption campaign if they are seen to be partial to the powers that be.

The silence of trade unions representing the private sector workers is sickening, to say the least. They are apparently aestivating. None of them have taken to the streets against the massive losses the Employees’ Provident Fund (EPF) has suffered at the hands of the bond thieves who have endangered the future of millions of workers. It is a crime to misuse workers’ funds and the trade union worthies who threw in their lot with a bunch of hypocrites in the garb of political leaders who captured power last year by pretending to champion good governance had better do everything in their power to protect the EPF.

Successive governments have had an itch to meddle with the EPF. Rajapaksa government tried to replace the EPF with a pension scheme which was also to be called EPF (Employee’s Pension Fund). It had to abandon its grand plan when a young FTZ worker was shot dead by the police during a protest against the pension scheme. The present dispensation, too, sought to remove the EPF from the Central Bank supervision, claiming that it wanted to ensure the safety of the 1.3 trillion-rupee fund. Thankfully, it could not do so owing to protests. Now, the self-appointed protectors of the EPF have been exposed for lining their pockets at the expense of workers. So much for their commitment to good governance!

Some ministers are striving to throw Mahendran overboard and absolve the government leaders including Prime Minister Ranil Wickremesinghe of wrongdoing as regards the Central Bank heist, as it were. But, never will they be able to shore up the crumbling image of the government or save any of its leaders. President Maithripala Sirisena should also be held responsible for this sorry state of affairs. He unashamedly dissolved Parliament last year to thwart the then Opposition’s efforts to table a COPE report on the bond scam in Parliament and thereby prevented the issue being used against the so-called yahapalana government at the last general election. He went so far as to deny previous COPE Chairman D. E. W. Gunasekera a  National List seat so as to silence the latter. The President, however, to his credit, later, refused to reappoint Mahendran as Central Bank Governor. But, he has to do much more by way of atonement for his sin. He has to appoint a special presidential commission headed by a sitting Supreme Court judge to probe the bond scam and the losses suffered by the EPF.

Let all trade unionists be urged to pluck up enough courage to fight for the safety of the EPF.