the Opposition Leader has called on the government to submit a detailed statement of all EPF and ETF share purchases from January 1, 2010 to April 30, 2012, to the parliament. He has said the statement should be certified by the Finance Ministry Secretary, who is the Chief Accounting Officer of the Ministry under which the EPF and ETF operate. According to the Opposition Leader, the monies of the EPF and ETF, belongs to the members. The EPF has over 13 million contributing and non-contributing members while ETF has 2.3 million accounts. Government agencies have custody of these Funds and therefore play only a fiduciary role, managing the Funds in the best interest of the members including investment in Treasury Bills and shares. "Recently the media carried news items alleging fraud and market manipulations in share transactions. This includes a push and dump strategy in which speculators pushed up the value of shares and then dumped them on these two Funds resulting in a loss for the Funds and a gain for a ring of speculators. These reports state that the loss in respect of five companies is alleged to be in the range of over Rs. 4 billion. This has caused consternation among the members, trade unions as well as employers who contributed on behalf of their employees. It has also impacted on the financial market," Wickremasinghe has said. "There are media reports that this issue will also be taken up by the International Labour Organization in Geneva," he has added. Referring to the recent assessment by the rating agency Standard and Poor which gave an economic risk score of 8 in the Banking Industry Country Risk Assessment (BICRA) and placed Sri Lanka in the "very high risk" category, Wickremasinghe has pointed out that the S&P report has also said that it sees "a potential conflict of interest in the Central Bank's role as its monetary board oversees EPF investments In addition to policy formulation and supervision of banks." "We see a potential conflict of interest in the Central Bank's role. In addition to policy formulation and supervision of banks, the monetary board of the Central Bank also oversees Employees' Provident Fund investments. The fund is a large investor in Sri Lanka banking stocks," S&P said. The Central Bank however, rejected S&P statement saying that there is no conflict of interest as a result of the EPF investing in shares of banks. The Bank criticized the rating agency for apparently founding its statement on the recent allegations that, according to the Bank, have obviously been designed to achieve the objective of discrediting the EPF. The Opposition Leader however has emphasized that the parliamentarians have a duty of oversight over these funds and safeguarding the rights of members. He has charged that full details of the investments made by these Funds are not even available to Parliament or its members. "In view of the media reports by the financial agencies and the reaction of financial and trade union sectors it is imperative that the Parliament takes action to fulfill its obligations," Wickremasinghe has explained. "Therefore this House requires details of all the transactions of the two Funds to make a considered decision regarding the truth or otherwise of these allegations and further action if any to secure the Funds," he has said. According to Wickremasinghe, the government has an obligation to the House to make available all the information required by the House to make its own determination on this matter. "Not only the Ministers even the officials have a duty to keep the House informed of all the information required and give truthful answers. Article 4 (a) of the Constitution have vested this House with the powers to ensure compliance." The Opposition Leader has concluded by saying, "These two Funds and the Central Bank come under the Ministry of Finance. In these circumstances I request this government to inform the House of the present position of the investments made by the Funds by tabling a detailed statement of all EPF and ETF share purchases from 01 January 2010 to 30 April 2012 (inclusive) certified by the Secretary to the Ministry of Finance who is the Chief Accounting Officer of the Ministry under which the EPF and ETF operate."
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