SRI LANKA: GOVERNMENT SCRAPES TOGETHER A FINAL

C O N F I D E N T I A L SECTION 01 OF 03 COLOMBO 001677

SIPDIS

SIPDIS

DEPARTMENT FOR SCA/INS

E.O. 12958: DECL: 12/17/2017
TAGS: PGOV PREL PTER PHUM MOPS CE
SUBJECT: SRI LANKA: GOVERNMENT SCRAPES TOGETHER A FINAL
BUDGET VOTE WIN

REF: COLOMBO 1656

Classified By: Ambassador Robert O. Blake, Jr., for reasons 1.4(b,d).


1. SUMMARY: On December 14, the United People's Freedom
Alliance passed its budget with a majority of 47 votes. The
Government's victory was not assured until the JVP decided,
in the final hours before the vote, to abstain. The decision
to abstain, after voting against the budget in the first two
readings, is causing dissension within the JVP leadership.
It is not clear what the government promised the JVP in
exchange for its vote switch. Among the JVP's longstanding
demands are the abrogation of the Cease-Fire Agreement and
the dissolution of the All-Party Representative Committee
charged with developing a devolution proposal. Meanwhile,
the British High Commission on December 13 issued a
condemnation on behalf of the EU of the abduction of family
members and staff of three Tamil National Alliance members of
parliament (reftel). The Pillaiyan group released the family
members and staff member in Batticaloa on December 15 after 4
TNA MPs abstained from the final budget vote. The vote
revealed more about the government's weakness that its
strengths. There were incidents of hostage-taking in two
successive rounds of budget voting that clearly intended to
sway votes in favor of the budget. With the departure of the
moderate SLMC leader Hakeem from the Cabinet, the government
now appears more dependent on the JVP's tacit support for its
own survival. End Summary.

CWC Decides Not to Risk It
--------------


2. (C) On December 14, the United People's Freedom Alliance
passed its budget with a majority of 47 votes. Despite this
seemingly comfortable majority, the Government's victory was
not assured until the JVP decided, in the final moments
before the vote, to abstain. When the JVP decision to
abstain became apparent, several other MPs - notably the
Ceylon Workers' Congress, which represents Up-Country Tamils
- decided against voting with the opposition, giving the
ruling coalition an even bigger lead. According to local
press and Embassy contacts, the CWC had decided to vote
against the budget over concerns about the recent treatment
of Tamil civilians in Colombo and unresolved problems of
estate workers. The CWC reversed its decision, however, as
soon as it realized the JVP planned to abstain, making it
impossible to defeat the government.


3. (C) Former Foreign Minister (and leader of the dissident
SLFP-M faction) Mangala Samaraweera told a news conference on
December 17 that the opposition had lined up two UNP
crossovers now serving as ministers, three SLFP ministers and
six other government MPs to vote against the budget. When
the JVP shift became known, according to Samawaweera, "we
asked those willing to cross over to stay. We did not want
them to take a risk at a time when there was no majority to
beat the government."

JVP's Abstention Causes Internal Dissent
--------------


4. (C) The JVP's last minute decision to abstain was likely
an act of self-preservation. The JVP, according to Embassy
contacts, feared that with the eleventh-hour crossover of
Anura Bandaranaike (the brother of former President Chandrika
Kumaratunga) to the opposition and the possible loss of the
Ceylon Workers Congress (CWC) votes, the Government stood a
good chance of losing the vote. The JVP, afraid of losing
seats in the general election that would likely result, could
not accept the risk and was forced to abstain. Local press
reports that the Government may have promised the JVP that it
would abrogate the Cease-Fire Agreement (CFA) and reduce the

COLOMBO 00001677 002 OF 003


cabinet to only thirty ministers. Minister of Transport
Dullas Allahaperuma, one of the President's main political
operatives, told Pol, however, that while the Government is
considering some reduction of ministers during an upcoming
cabinet reshuffle, the total could not be reduced to thirty.
He also dismissed the idea that the Government would abrogate
the CFA.


5. (C) The decision to abstain, after voting against the
budget in the first two readings, is reportedly causing
significant dissension within the JVP leadership. The JVP
politburo on December 13 decided to vote against the budget.
This decision was supported by JVP Secretary General Tilvin
Silva and MPs Vijitha Herath and Anura Kumara Dissanayake who
argued that the JVP would lose credibility if it changed its
position on the budget. JVP MPs Wimal Weerawansa and KD
Lalkantha, however, insisted on abstaining rather than
allowing the Government to lose the vote - which might well
usher in a UNP-led government. This group argued that
support for the proposed budget, and with it the preservation
of the current government, was necessary to continue the
campaign to defeat the LTTE.

SLMC Quits Government, Except for Two
--------------


6. (C) Sri Lanka Muslim Congress (SLMC) leader Rauff Hakeem
made the decision to leave the Government on December 13 over
the government's broken promises to address grievances of
Muslims in the East, particularly on alleged seizures of
their farm lands by the Environment Ministry (reftel). He
took three other MPs with him, while two others remained with
the Government. One, K. Baiz, feared charges for corruption
and illegal possession of firearms if he crossed to the
opposition. Another, Nijamuddin, reportedly gave in to
Government offers of power and perks. The government then
held Nijamuddin in safe-keeping at the Hilton Residences
apartment building for more than two days, until just before
the vote, so that his SLMC colleagues could not turn him
around. In an apparent reprisal for Hakeem's turnabout, on
December 17 the Inland Revenue Department raided a Colombo
ice-cream parlor Hakeem's wife Shahnaz owns, checking its
financial records. (Note: Hakeem had previously called for
the Inland Revenue chief's suspension because of an alleged
Value-Added Tax scam that cost the government billions of
rupees.)


7. (C) In another bizarre twist, a Buddhist monk who holds
one of nine seats in Parliament for the monk-based JHU
reportedly had pledged to support the opposition. Under
severe pressure, he checked into a private hospital to avoid
having to vote. Government representatives found him there,
had him transferred under armed guard to a government-run
hospital, then brought him into parliament with an IV drip in
place to cast his vote. He voted for the budget.

Government's Strong-arm Tactics Condemned
--------------


8. (C) The British High Commission on December 13 issued a
statement on behalf of the EU condemning the abduction of
family members and staff of three Tamil National Alliance
members of parliament (reftel). The statement noted that
"The European Union is deeply concerned by disturbing reports
of abductions of a number of civilians connected to members
of the Sri Lankan parliament. Kidnapping is the behavior of
terrorists and the EU condemns it without reservation."
Local press reports say that one MP received a call from her
secretary just before the vote warning that those kidnapped

SIPDIS
would be killed if the MPs voted against the budget. Four
TNA MPs abstained from the final budget vote. On the evening
of December 15, the Pillaiyan group released the family

COLOMBO 00001677 003 OF 003


members and staff in Batticaloa.


9. (C) There is widespread speculation, fueled by comments by
key ministers, that the President will carry out a Cabinet
reshuffle soon. It is also possible that he will move to
prorogue Parliament (suspend it for up to two months). This
would give the President an opportunity to terminate some
investigations that have become increasingly uncomfortable
for his government, banish the prospect of a no-confidence
vote against individual ministers such as Tourism Minister
Milinda Moragoda, and replace the heads of two oversight
committees, Committee on Public Enterprises (COPE) chair
Wijedasa Rajapakse and Rauff Hakeem at the Public Accounts
Committee. The fiscal consequences of the budget battle will
also emerge over time, as the payments and perks promised to
ensure votes for the government reached astronomic
proportions.


10. (C) COMMENT: Embassy shares the European Union's
misgivings about the apparent use of hostage-taking by a
paramilitary allied to the government as a means of swaying
two successive budget votes. The government's repeated use
of such extreme tactics has damaged its standing as a
democratic regime. We will be watching closely to see how
the JVP resolves its internal conflicts over strategy
proceeding from its change of positions between the two
budget votes. It is likely that the JVP extracted some
concrete concessions in exchange for its switch, since it
will need to show that it got something in exchange for
saving a government that many of its supporters consider
ineffective, profligate, and corrupt. In addition to
demanding the abrogation of the Cease-Fire Agreement, the JVP
has long been agitating for the government to terminate the
APRC process to draft a devolution proposal. The JVP is not
the only party that has likely lost credibility with its core
voters, however. We would expect the two parties
representing Up-Country Tamils to pay heavily for their
continued support of the government in the next general
election. In the meantime, the Government continues to
market the budget win as a victory in the fight against
terrorism. What the budget vote demonstrated to most
observers, however, is that the government has now become
dependent on tacit support from the JVP for its continued
survival.
BLAKE