UNP media spokesman misleading public on printing currency notes - Siyambalapitiya

Deputy Finance Minister Ranjith Siyambalapitiya said the UNP media spokesman was trying to gain political mileage for his party by misleading the people with incorrect information on money printed by the Central Bank (CB) this year.

The Minister said the CB had to print Rs. 12 billion in excess last year due to the economic growth rate and the GDP deflation exceeding the anticipated rate.

The economic growth rate last year was 7.4 percent though the anticipated rate was 6 percent and GDP deflation reached 10.3 percent though the anticipated rate was 9 percent.

The CB printed notes worth Rs. 12 billion in excess of its target due to the high economic growth rate and the GDP deflation reported last year. The bank planned to issue notes to the value of Rs. 30 billion last year.

The CB annually prints currency notes taking into consideration the economic growth rate and GDP deflation of the previous year.

To accuse the Government that it wanted the CB to print currency notes worth Rs. 38 billion to spend on promotional activities and maintain a jumbo Cabinet is sheer ignorance of the actual maintenance cost of the Cabinet and the Government's monetary policy, Siyambalapitiya said.

The Minister said the maintenance cost of a Cabinet Minister for a year is Rs. 20 million and the overall cost of the Cabinet is around Rs. 800 million.

When asked why the Government doesn't slash the maintenance cost per Cabinet Minister by cutting down his or her perks, he said the fuel allowance per Minister has been reduced and unnecessary expenses have been pruned.

Ministers and MPs of successive governments have been severely criticised for enjoying too many perks and misusing public funds.

Siyambalapitiya said increasing productivity is the only way to balance economic growth and inflation. The fertilizer subsidy has increased the yield by 20 bushels per acre. The Mahinda Chintana 10-year development program is focused on developing industries and increasing productivity in all sectors.

Siyambalapitiya said the Government gets money for its development projects from international donor agencies and most investments are on infrastructure development activities.

Deputy Director Economic Research CB, Swarna Guneratne said the focus of the 2006 monetary policy was to contain high monetary expansion without interrupting the growth of the economy.

The CB is following a strict monetary policy this year under its road map for monetary and financial sector policies to curb inflation while supporting economic growth.

LF