Posted on February 21st, 2017

By Dhammika Ranaweera Courtesy  Ceylon Today

A determined stand-off between Minister of Public Enterprises Development Kabir Hashim and the Finance Ministry at yesterday’s Cabinet meeting sent emotions…… roaring in connection with a clash of opinions on the amount of compensation to be paid for cancellation of an agreement signed by the previous regime to purchase aircraft.
Hashim objected to the Finance Ministry’s cancellation compensation estimate of US$ 154 million though Cabinet had agreed on a payment of between USS 75-85 million.
Informed sources said the previous UPFA regime had signed an agreement with Aircap Corporation in 2012 to purchase several aircraft.

However, the current government had decided to cancel that agreement on the basis that the intended purchase was not necessary.
As a result of that agreement being cancelled the government was under compulsion to pay compensation to the afore-mentioned firm, with the Cabinet agreeing to it.
The sum of compensation had been ratified by Cabinet after a Cabinet Sub-Committee formed to look into the matter sanctioned it.

However, sources revealed that Minister Hashim had pointed out at the Cabinet meeting yesterday that the decision taken by the Finance Ministry to pay a hefty sum as compensation, having disregarded the amount agreed by the subject Minister and the Cabinet, was unethical and was an arbitrary decision.
The source added that Minister Patali Ranawaka and Dr. Sarath Amunugama had also spoken in support of Minister Kabir Hashim at the Cabinet meeting.

It is also learnt that President Maithripala Sirisena has advised the Finance Ministry to temporarily suspend the payment of compensation to Aircap Corporation.


  1. Dilrook Says:

    In 2005 before the presidential election Hasim filed a case against Mahinda alleging he defrauded Help Hambantota Charity funds meant for tsunami victims by depositing the money in a private bank account. Sarath Silva decided there was no fraud.

    Given the balance of payment crisis, cancelling this order is the right thing to do. The dispute here is about the amount. Looks like someone had pocketed $69 – $79 million.

  2. Randeniyage Says:

    “someone had pocketed $69 – $79 million”. That someone MUST BE the Elephant with a tie, treasurer of BHG.

  3. Lorenzo Says:

    Hora Vs Hora

    Srilankan badly needs PLANES. We only have a handful of planes. This is a disgrace.

    Aircap Corporation is a LAWN tractor company!! They have NO planes!

    The correct name is AerCap.

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