Turning loss-making State enterprises into thriving businesses:

Remarkable progress in two years - Minister Dayasritha Tissera

By Ranil WIJAYAPALA

Minister Tissera inspects mineral deposits in Pulmudai

Lanka Phosphate Eppawala.

When President Mahinda Rajapaksa, set up State Resource and Enterprise Development Ministry almost two years ago, a heavy burden was cast on the Ministry to transform those 26 institutions which had earlier been reputed State institutions that had undergone ups and downs under different governments, into thriving enterprises.

It had to undertake the responsibility to minimise the losses in the institutions, transform profit making institutions into lucrative ventures and to transform the institution that can be changed into profit making institutes introducing new managements.

Dayasritha Tissera, a novice to the Cabinet in 2010, had to undertake this responsibility along with his Ministry staff, on behalf of the Government when the opposition was focusing their eyes on these enterprises which were in the process of collapsing after becoming a burden to the Government.

Today after two years of hard work Minister Dayasritha Tissera is talking in a satisfied tone about the measures his Ministry had taken to make these State enterprises moving ones that can contribute at least on a small scale to the national economy. “We have done many things to bring those institutions to the present State and we have to do a lot more in the future”, Minister Dayasritha Tissera said. “When we took over this Ministry we had to obtain funds from the Treasury to run these institutions on a monthly basis. Now we are not obtaining funds from the Treasury to run these institutions. We have made plans to make use of the profits made by certain institutions under our Ministry to strengthen the loss making institutions under our Ministry.

The Cabinet has given approval for this process and the State Management Corporation was established with that objective”, he added.

Accordingly, we were able to compensate the workers of the Ceramic Corporation after obtaining Rs. 500 million from the Pulmudai Mineral Sands Company which is the highest profit making institution under him. The Mineral Sands Company which is one of the important institutions under the Ministry, has now been transformed into an institute that earned a profit of Rs. 1,530 million in the year 2011.

“When our Ministry took over, it was making a profit of Rs. 220 million and within the past one and half years we have been able to increase that profit to Rs. 1,530. “We are planning to set up new machinery worth US$ 70 million in the Pulmoddai Mineral Sands Company to increase its production capacity”, he added.

State Resources and Enterprise Development Minister Dayasritha Tissera has said that the increase in profits was due to the end of the war and the Company’s open tender policy.

The Company currently exports mineral sand to Russia, Japan, US and the UK and is to venture into value added export products. At the same time, the Ministry has also taken the initiative to increase the capacity of the Lanka Phosphate Limited, Eppawala, after installing new machinery at a cost of Rs.56 million.

“We are making use of new technology to produce di-ammonia phosphate and tri-super phosphate at the Lanka Phosphate Limited at Eppawala. The newly established fertiliser plant will commence work soon to expand its capacity.

“It is expected to produce 200 metric tons of fertiliser per day. The new machine has a capacity to manufacture 10 metric tons in one hour compared to the old machine which manufactured five mt per hour.

It is not enough to meet the total requirement of fertiliser,” the Minister said. According to the Minister, the annual phosphate requirement of the country is 75,000 metric tons and the new fertiliser plant will meet the total requirement and help the country save Rs.20 billion spent to import fertiliser annually. Lanka Cement Corporation has also undergone tremendous progress during the past two years with the new measures introduced by the Ministry to improve their production capacity.

“With regard to the cement industry what we are doing at present is to import cement bags and release them to the market. We have made plans to import cement in bulk form and bag them in Sri Lanka and release them to the market. Step by step we are going to restart the cement production in the country specially at the Kankesanthurai factory”, the Minister said.

The Lanka Cement Corporation is also manufacturing block stones and cement blocks to be used for repairing activities of roads. Lanka Ceramic Corporation which also had a series of issues has also restarted its manufacturing process after the Ministry took the initiative to resolve a lot of problems of the workers. “With the collaboration of the Sri Lanka Army and the Civil Defence Force we have restarted the tile and bricks production at these factories”, the Minister said.

The Valachchenai Paper Factory has also started contributing towards the national paper requirement producing over 130 metric tonnes of paper during the month of May.

“In 2009, this factory had produced only 30 metric tonnes of paper per month. At present, it has increased by three to four times. Presently, the administration is having the ability to pay the salaries of its employees and electricity bills from its own income”, the Minister added.

“Currently, ninety five percent of the total national paper requirement is met by imported paper and we are planning to produce more paper, with the aim of increasing the monthly paper production of the Valachchenai Paper Factory up to 200 metric tonnes and up to 500 metric tonnes within one year.

The ministry aims to produce more paper stocks which would be sufficient to cover the paper requirements of the country”, the Minister said. The plantation sector institutions under the State Resource and Enterprise Development Ministry is also changing for the better as they are undergoing a restructuring process under the Ministry.

“If we consider National Estate Development Board and State Plantations Corporation and Elkaduwa plantation, they are undergoing new reforms and we are now in the process of minimising the losses incurred by these institutes to minimise the burden on the government”, the Minister said. Even the BCC Lanka Limited also was restructured for better income generation and it has now become a profit generating entity. There are some ventures we are still searching investors and Kantale Sugar Factory is one such entity. “Now we are in the process of searching an investor for the Kanatale sugar factory we will be able to finalise the process very soon”, he said.

When transforming those institutions into thriving business ventures, the Ministry had to resolve a lot of workers’ issues.

“We have taken steps to resolve major issues with regard to the workers attached to Lanka Paper Mills and Lanka Ceramic Corporation. Even for Salusala and Laksala we are in the process of solving issues of the workers step by step by paying compensation for those who volunteer to retire and to obtain the service of the workers who are not willing to retire under voluntary retirement schemes”, the Minister said.

“We are continuing all these processes in a very transparent manner after. We are giving these institutions for investors under management agreements after clear valuation by the government valuers. We are adopting very transparent process with the involvement of the Finance Ministry and other relevant Ministries. We are taking decisions with regard to selecting the investors for these institutions after appointing committees to select the investors”, the Minister said.

“Therefore, there is no possibility of taking wrong decisions in this process. We are giving these institutions under management agreements and under that we make sure that the government also can charge an annual tax from these investors”, the Minister added.

“At the same time we have gone beyond the value of the government valuer when handing over these institutions for investors as we go for investors offering the highest bid for these institutions. So far we have been successful in the process”, the Minister remarked.

“Therefore, I am confident that our Ministry, within the past two years has been able to render an exemplary service to revive all institutions which have been cast on us”, Minister Tissera said.