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| Sunday, 28 April 2002 |
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Budget 2002 - A recipe for social disaster A press release by Movement for National Land and Agricultural Reform (MONLAR). The first Budget proposal of the new United National Front Government in March 2002 contains sufficient ingredients for another major social disaster in the country, not too far away, if some of its major proposals were to be accepted and implemented. We the Movement for National Land and Agricultural Reform (MONLAR) would like to bring some of these aspects of the budget proposals to the serious attention of those who are involved in and are able to influence policy making in the country. We would also like to alert all those who are concerned about Peace, Justice and Social Harmony to the need for serious rethinking. The ordinary people who have suffered so much, for so long, due to the unwise and extremely undemocratic policy planning urgently need such concern. What are the conclusions that one could draw from the first section in the Budget speech which says that there is a complete break down in the economy with growth rate reaching negative figures for the first time in History? Is this total failure, entirely due to the inefficiency and lack of management of the former PA government during the last 7 years? Or is it to be understood as the final result of the totality of market led policies adopted throughout the last 24 years, without interruption by the two Governments of UNP and PA, an unwise policy of complete dependence on the private sector, the business community in Sri Lanka and foreign investors. Is it not clear that the policy and also those who were responsible for planning and implementation remained the same, although the governments changed? Those who could cross over from one to the other party in power, so easily, did so to ensure that the policies remained unchanged. Is it not frightening to see that even with such obvious and disastrous failure and resultant violence, particularly against the poor, the government does not have the slightest hesitation or a brief moment of "rethinking" before deciding to simply continue with the same strategy even more vigorously and utilizing far more destructive policy instruments. Let's look at some concrete facts and realities. The Budget has proposed immediate issuing of titles and quick process of land regularization to make it easier for 1.2 million small farmers to sell their land away quickly, if they so desire. It was very clear that this was one of the strongest and most consistent recommendations of the World Bank since their policy recommendation "Non Plantation Sector Policy Alternatives" (March 1996). The Budget clearly says how much the people are already indebted. The total debt works out to Rs. 77,500 per person. All farmers in the country are already dangerously indebted. Whatever the promises of the Government, the paddy farmers this season are again condemned to sell their paddy at prices ranging from Rs. 8 to Rs. 10 per Kg. Only in some rare instances they are able to get Rs. 11 for their paddy. In Mahaweli areas the cost of production of a Kg of paddy is about Rs. 13.50. The number of such farmers who suffer such terrible losses is about a million families. In spite of this experience every year for last so many years, the prices of paddy remain so low due to the stubborn policy of the World bank that dictates that the Government should not intervene in any way in supportive marketing. Thus, there is a complete monopoly in the paddy/rice market in the hands of a small group of rich middlemen traders. It is no secret that there are arrangements made by the Government to start water privatization and water marketing, in the name of better water management. Another proposal in the budget is to privatize public utilities that are not making profits. This would include not only electricity, Postal services and telephones etc. but would also include services essential to the people including the poor such as water and sanitation.. There are plans to build more infrastructure facilities such as super highways, Economic Development Zones etc at a cost of several hundred million rupees to the State. These State expenses would not be recovered from taxes from the rich and the big businesses. Therefore, all these would further burden the people. About 60,000 young people were killed during the recent rebellion in the South. These were youth who became economic destitute without proper livelihoods. The war in the North East has also killed over 60,000 youth both in the North and the South (LTTE at a recent press interview gave these figures as over 60,000 civilians and about 17,000 LTTE combatants. Much explanation is not needed to show how these violence and deaths were also largely related to the absence of livelihoods for youth. The economic philosophy and strategy on which the present Budget is based would, intentionally, create millions of new economic refugees and destitute. Therefore it is clear that worse forms of social violence and destruction of lives through suppression and political unrest would result. Is it for the purpose of creating a sufficiently strong repressive machinery to meet the opposition that people may launch against such destruction , that we see the new efforts to form a kind of unity and alliance between the two major political parties. Both major political parties, have in fact agreed with this economic policies. They are very likely to unite to meet the urgent needs of the present economic proposals. We feel the most important question that needs to be raised in relation to the budget proposals and the proposed political alliance is the actual purpose behind this proposed politics without descent. It was from August 1998 that the business community/private sector trade chambers have admitted that although they have been leading the economy as the "engine of development "during the period of last 24 years, they have not succeeded in reducing poverty or in solving any other social problem such as unemployment, health, education etc. What we had instead, were only massive loss of life, social and political unrest, injustice, hunger and poverty. The discussions on this budget, throughout the country, should raise the question as to whether this economic policy should be allowed to continue any longer. We MONLAR believe that this question should be raised far more intensely by the people and their organizations. |
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