Batticaloa District ITAK MP Shanakiyan Rasamanickam has asked in Parliament whether Rs. 41 billion in Treasury fuel subsidies reached consumers, noting that the Ceylon Petroleum Corporation (CPC) posted a Rs. 29.2 billion profit in the same period.
Speaking in Parliament on Thursday, he questioned whether the full benefit of the Rs. 41 billion allocated to the CPC between April and June had been passed on through lower fuel prices. He called for greater transparency in the use of public funds.
Rasamanickam said the CPC recorded a net profit of Rs. 29.2 billion during the same three months. He asked whether the State-owned corporation’s priority should be generating profits or providing affordable fuel.
He also challenged Deputy Minister Kaushalya Ariyarathne’s statement that fuel was being sold below its import cost. Rasamanickam said diesel was imported at Rs. 307 per litre and petrol at Rs. 322, and he sought clarification on how those figures compared with retail prices and the fuel pricing formula.
Referring to the Finance Ministry’s Mid-Year Fiscal Position Report, he said the Treasury held Rs. 690.3 billion in cash at the end of June.
He asked for details of all fuel subsidies provided since January and called for targeted relief for farmers, fishermen and public transport operators. He warned that higher diesel prices could increase production and transport costs.
Background
The CPC is the State-owned company that imports and sells a large share of the fuel used in Sri Lanka. Retail prices of petrol and diesel are revised under a pricing formula, and changes in the global oil price, the exchange rate and taxes feed into what motorists pay at the pump.
A subsidy from the Treasury is public money paid to cover part of the cost of a product so that the selling price stays lower than it would otherwise be. When a subsidy is paid to a state corporation, MPs and economists commonly ask how much of it reaches consumers and how much improves the company’s own accounts. That is the question Rasamanickam raised.
The Mid-Year Fiscal Position Report is the Finance Ministry’s published update on government revenue, spending and cash balances for the first half of the year, and the figures he cited come from it.
What it means
Diesel is widely used in farming, fishing, goods transport and buses, so its price affects the cost of food and travel for households. Rasamanickam warned that higher diesel prices could raise production and transport costs.
He argued for relief aimed at farmers, fishermen and public transport operators rather than a general subsidy. The reports did not carry a response from the Government to his questions on how the Rs. 41 billion was used or how the retail prices were set, so those questions remain open.
