This is the second report in a series of two reports on Sri Lanka’s central government budget for the year 2021. The report assesses whether the expenditure allocations and taxation policies are in line with the government’s policy.
The published information on debt underestimates Sri Lanka’s overall external public debt burden and its distribution amongst external lenders. This problem arises because Sri Lanka’s reporting of external debt is limited to debt held directly by the central government and excludes debt held by state-owned enterprises (SOEs). This reporting problem is especially evident when estimating Sri Lanka’s overall debt obligations to China, since much of Sri Lanka’s debt from China is placed on the books of Sri Lanka’s SOEs. It also exposes a loophole by which debt statistics can be manipulated, and even miscounted, in the midst of such manipulations.
The role played by the Cabinet of Ministers is critical to ensure that the government functions efficiently and effectively. Verité Research has found that the way in which Cabinet portfolios are designed in Sri Lanka impedes the ability of government to be effective.
Verité Research conducted a forum on ” Improving National Budget Practices: Solutions for a Professional Government” on the 27th of February 2020 at Hilton Colombo. At this forum Verité Research discussed how the government can improve its budget process through better formulation, implementation and controls which will lead to effective and efficient management of public finance.