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The Parliament of Sri Lanka | Welcome - Land Reform ......The President of the Democratic Socialist...
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1 President’s Secretariat Land Reform Commission Performance 2010 1 st January, 2010 – 31 st December, 2010
Transcript of The Parliament of Sri Lanka | Welcome - Land Reform ......The President of the Democratic Socialist...
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President’s Secretariat
Land Reform Commission
Performance
2010
1st January, 2010 – 31st December, 2010
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Land Reform Commission Performance Report 2010
Contents Page No
1. Introduction
2. Staff of the Land Reforms Commission
3. Composition of the Staff
4. Performance
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06/01/2012 His Excellency Mahinda Rajapakse, The President of the Democratic Socialist Republic of Sri Lanka, Temple Trees Colombo 03 Your Excellency, Performance Report The members of the Land Reforms Commission are pleased to submit to you the following documents in accordance with Section 14(2) of the Finance Act No. 38 of 1971.
01. Performance Report of the Land Reform Commission. 02. Balance Sheet of the Land Reform Commission as at 31st December, 2010 03. Income & Expenditure Account of Land Reform Commission for the year ended
31st December 2010. 04. Report of the Auditor General
Thanking you. Yours faithfully, Nimal G Punchihewa Attorney-at-Law Chairman Land Reform Commission
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Information of the Land Reform Commission
Institution- Land Reform Commission Ministry - President Secretariat Address- C 82, Hector Kobbakaduwa Mawatha, Colombo 07 Email Address [email protected] Contact Number 0112694251/0112672273 Fax Number 0112693438/698849 Auditors Auditor General, Department of Auditor General,
Colombo 07
Bankers Bank of Ceylon, Corporate Branch, Fort National Savings bank, Borella State Mortgage and Investment bank, Kollupitiy
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Introduction Land Reform Commission which has been established under Land Reform Act No. 1 of 1972 inherits a proud history which goes back to year 1972. The role of Land Reform Commission, for a period over 35 years, has been performed by the provisions made by Land Reform Act amended from time to time as well as by policy decisions taken by the government from time to time. Procedures adopted for the achievement of the major role and release of statutory obligations of land owners, payment of compensation to land owners, utilization of lands which have been vested in productive investments have varied from time to time. Under the scheme for the delivery of one hundred thousand lots of land among the general public according to Mahinda Chintana of His Excellency the President after the Presidential Election held in year 2005, the Land Reform Commission has taken each and every step to make that program a total success. Further, during this period, the salaries of employees serving in the institution have been increased and a program has also been launched to inculcate new spirit whilst establishing their employment security. Accordingly, following measures have been taken during the period.
i. Recovery of the possession of the land which are belonging to the Land Reform Commission but not so far been identified.
ii. Recovery of the possession of lands which have been alienated for
unproductive investments.
iii. Taking actions in accordance with the Cabinet Decision on the lands delivered during the period from 2002-2004 without legal authority and utilizing such lands in productive investments after recovery of possession.
iv. Preparation of accelerated program for the purpose of distributing lands
which are belonging to Land Reform Commission under the program for the distribution of one hundred thousand lots of lands and implementation of the program “Ranbima Deeds Program” as a task of national importance whilst marking new turning point in the program implemented to regularize the lands distributed so far among the occupants
v. Programs for the increase of income.
a) Ranaviru Seva Authority
b) Obtaining compensation in respect of lands acquired by the government
c) Collecting income in respect of lands alienated to public institutions
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d) Preparation of proper program for the purpose of collecting lease rent in respect of lands alienated to various persons on lease but the lease rent has not so far been collected.
e) Alienations of granite on lease and collection of relevant income.
f) Collecting income by imposing new regulations in respect of Gem Lands.
g) Collecting revenue from lands with mineral resources such as silica,
dolomite and sand. With a view to make the staff aware on these tasks and call suggestions and comments of officers, it was commenced to appoint committees consisting of officers of the institution for each such task and to conduct workshops. Further, training programs have also been conducted to train the staff of the institution. As a timely measure to perform the role of Land Reform Commission according to government policies and also to Mahinda Chintana Concept introduced by His Excellency the President, necessary meetings have often been called under the direction of Hon. Minister of Agriculture Development. At these meetings, important decisions have been taken and follow up actions have also been taken with the implementation of such decision. In addition to the above, general public were offered an opportunity to forward their problems. Accordingly, necessary decisions were taken with immediate effect by the committees appointed by Hon. Minister. Also, direct discussions chaired by Hon. Minister have also been conducted on the demand of the occasion. In addition, under the direction and guidance of Hon. Minister, action was taken to provide lands for the investments identified as productive on the recommendations of advisory committee consisting of experts. Further, a committee consisting of Ministers has been appointed under the direction of His Excellency the President for taking further actions in respect of lands belonging to Land Reform Commission out of the lands in extent million acres taken over by the Land Reform Commission. Under this program, tremendous contribution was made to economic and social development of the country utilizing resources which have so far not been under the control of the Commission.
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Land Reforms Commission
VISION
Transformation of the Land Reform Commission as the leading institution
which bears the responsibility of utilizing lands and physical
resources vested under Lands Reform Act
for the progress of people and motherland.
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Land Reforms Commission
MISSION STATEMENT Ensuring active contribution for the national development by way of implementing land reform process, improving productivity of lands in excess of ceiling, giving effect to the maximum limit of ceiling on timely requirement, paying compensations, investing in productive economic fields and maintaining a reserve of lands which can be utilized for the benefit of future generations.
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Objectives 1. Compilation of information in respect of lands.
i. Identification of lands which have been declared but so far not identified.
ii. Identification of lands belonging to Land Reform Commission based on information provided by general public.
iii. Taking over of lands alienated to other parties if such lands are not utilized for the purpose for which they have been alienated.
2. Performance of following activities in respect of lands vested in the Land Reform
Commission
i. Release of statutory determination and legal obligations. ii. Taking over of lands by the Land Reform Commission which are in
excess of the ceiling. iii. Payment of compensation in respect of lands which were taken over by
the Land Reform Commission iv. Return of lands to the owners which were declared but not falling under
such requirements 3. Utilization of lands vested in the Land Reform Commission in productive
investments in accordance with the provisions stipulated in the act and policies made by the government with a view to achieve economic and social development of the country.
4. Collection of revenue which are to be collected in respect of lands belonging to
the commission and making contributions for the economic development process of the country.
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Functions: • Regularization of the maximum extent of land which can be kept under private
ownership in terms of the provisions of the Land Reform Act. • Identification and taking over of lands in excess of the ceiling. • Release of legal obligations in terms of the provisions of the acts. • Payment of compensation to the declarants in respect of lands taken over by the
Land Reform Commission. • Taking actions to return the possession of lands which have been taken over but
exempted from the encumbrances of the Land Reform Act.
• Updating land documents and collecting information on land in coordination with the field.
i. Lands which have been declared but so far not been identified. ii. Non-declared lands which are in excess of the ceiling. iii. Lands which have been alienated but not been utilized in productive
investments.
• Making contribution to achieve the economic development of the country. i. Providing lands for the projects approved by the Board of Investments. ii. Providing lands for the agricultural projects and other cultivation purposes. iii. Providing lands for industries.
• Making contribution to achieve the social development of the country. i. Distribution of lands among landless people for the construction of houses. ii. Providing lands to special projects launched in accordance with the policy
decisions of the government. iii. Providing lands to religious places. iv. Providing lands for public purposes. v. Providing lands to various public institutions.
• Implementation of revenue collection projects. i. Collecting revenue on natural resources. ii. Providing lands on lease and collection of lease rent. iii. Recovery of money due from the government, non-government
organizations and other persons.
• Restructuring of the organization structure of the Land Reform Commission i. Creating an efficient and well-trained staff. ii. Introduction of a proper system for the assignment of duties. iii. Assignment of duties through decentralization of powers. iv. Directing staff of the Commission for discussions, workshops and training
programs • Providing physical resources and other necessary facilities to achieve efficiency
and productivity.
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Land Reform Commission
Role
This role has to be enhanced within the subjects in broad aspects owing to the policy decisions taken by the government from time to time in addition to the all entrusted by the provisions of the Act.
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Land Reforms Commission
Legal Authority and Acts 1. Land Reform Act No. 1 of 1972 2. Land Reform (Amendment) Act No. 39 of 1975 3. Land Reform (Amendment) Act No. 14 of 1981 4. Land Reform (Special Provisions) Act No. 39 of 1981 5. Land Reform (Special Provisions) Act No. 14 of 1986 6. Land Reform (Special Provisions)(Amendment) Act No. 18 of 1986
According to the Act Nos. indicated (1) and (2) above 987,906 acres of lands have been vested in the Land Reform Commission in the following manner 1. From Local Declarents - 563,449 Acres 2. From Sterling Companies - 195,644 Acres 3. From Rupee Companies - 228,813 Acres Total - 987.906 Acres In respect of the Acts indicated in (1) and (2) above,
I. Amendments have been made by Acts No. (3) and (6) above. II. Provisions have been made by Acts indicated in (4), (5) and (6) above.
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The composition of the Land reform Commission established under Land Reform Act No 01 of 1972 is as follows
I. Chairman- Appointed by the Hon. Minister in charge of the
Subject II. Members 05 - Appointed by the Hon. Minister in charge of
the Subject III. Ex- officio members 05 –
The decisions and approvals taken by the board of this commission are applied in the implementation of the functions of the Commission. Approval of the Board of the Commission is obtained for each task. 627 meetings of the Board of the Commission have been conducted from 1972 up to 31.12.2010.
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Chairman appointed to the Land Reform Commission under Section 45 (1) of the Act
Serial No. Name Substantive
Post
Date of Appointment
and duration of holding office
Official Address
Telephone Number
01 Mr. Nmal G. Punchihewa, Attorney-at-Law
Chairman Land
Reforms Commission
From 03-12-2008 to
date
Land Reform Commission, C - 82, Hector Kobbekaduwa Mawatha, Colombo 07
0112698798
Members appointed under Section 45 (1) b of the Act
Serial No. Name Substantive
Post
Date of Appointment and duration
of holding office
Official Address
Telephone Number
1. Mr. Hariguptha Rohanadheera Attorney-at-Law
Executive Director
From 04-06-2008 up-to-date
Land Reform Commission, C 82, Hector Kobbekaduwa Mawatha, Colombo 07
0112693967
2. Mr. H. A. N. S. Kumara Mr. Sunil Gunawardhana
Assistant Director
Director
From 01-01-2010
To 16-06-2010
From 16-06-2010 Up-to-date
Department of National Budget, General
Treasury, Colombo 01
0112484500
3. Mr. P.L.U. Dissananyaka
Additional Secretary
From 21-10-2009 up-to-date
Ministry of Plantation Industries,
55/75, Vauxhall
Street, Colombo 02
0112438707
4. Mr. P. W. Senarathne
Chief Valuer
From 01-01-2007 up-to-date
Department of Valuation Maradana
Road, Colombo 10
0112695533
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Ex-officio Members under Section 45 (1) C of the Act
Serial No.
Name Substantive Post
Date of Appointment and duration of holding office
Official Address
Telephone Number
01 Mr. S. D. A. B. Boralessa Mr. R.P.R. Rajapakshe
Commissioner General of
Lands
From 01-01-2010
To 09-08-2010
19-08-2010 Up-to- date
Land Commissioner’s
Department, Hector
Kobbekaduwa Mawatha,
Colombo 07
0112866172
02 Mr. R. Hewawitharana
Commissioner General of Agrarian
Development
From 10-03-2008 up-to-date
Department of Agrarian
Development, 42, Sir Marcus
Fernando Mawatha,
Colombo 07
0112672712
03. Dr. Jinadaree de Zoysa Mr. Kamal Mankotty
Director General of Agriculture
From 11-06-2009
To 15-07-2010
From 15-07-2010
Up-to-date
Department of Agriculture, Gannoruwa, Peradeniya
0812388331
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Management of Physical Resources
Serial No. Type of Asset
Posi
tion
at th
e co
mm
ence
men
t of
the
Yea
r
Changes occur during the year
Posi
tion
at th
e en
d of
th
e Y
ear
1. Cabs 10 10 2. Jeeps 02 02 3. Vans 01 01 4. Motorcycles 01 01 5. Duplo Machines 01 01 6. Photocopiers 05 05 7. Computers 31 31 8. Computer Printers 31 31 9. Laptop Computers 01 01 10. Fax Machines 15 15 11. Typewriters 21 21 12. Electronic Typewriters 03 03 13. Safes 10 10 14. Cameras 01 01 15. Television sets 01 01 16. Refrigerators 01 01 17. Roneo Machines 02 02 18. Loud Speakers 01 01
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Staff of the Land Reforms Commission
With a view to transform the Land reforms Commission as the leading institutions for the management of lands and physical resources alienated under Land Reform Commission to ensure the prosperity of people and the country chairman performs his role as a Chief Executive Officer of the Land Reforms Commission. Further a staff consists of 415 officers including Executive Director, Division Director and Directors carry out the functions of the Land Reforms Commission assisting the Chairman. The staff has been divided into 14 divisions and 18 district offices.
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Staff of Land Reform Commission as at 31-12-2010
Serial No. Post Number Permanent Contract Casual
1. Chairman 01 01 - - 2. Executive Director 01 01 - - 3. Secretary 01 01 02 - 4. Consultant 02 02 - 5. Director I 03 01 - - 6. Director II 03 03 7. Director III 01 01 8. Accountant III 01 01 - - 9. Assistant Director IV 27 27 - - 10. Legal officer IV 01 01 - - 11. Evaluation Inspector IV 01 01 - - 12. Legal Assistant V 02 02 - - 13. Staff Assistant V 27 27 - 14. Transport Officer IV 01 01 - - 15. Typist Stenographer V 02 02 - - 16. Accounting Officer V 01 01 - - 17. Clerk V 73 73 - - 18. Clerk VII 104 101 01 02 19. Accounts Clerk VII 03 03 - - 20. Field Officer VI 11 11 - - 21. Field Officer VII 45 45 22. Courts Clerk VI 02 02 - - 23. Typist VI 18 18 24. Typist VII 20 20 25. Shroff Vi 01 01 - - 26. Droughts man VI 01 01 - - 27. Telephone Operator VI 01 01 - - 28. Roneo Machine Operator VIII 01 01 29. Photocopy Machine Operator
VIII 01 01 - -
30. Driver VIII 17 17 - - 31. Bookbinder VIII 01 01 - - 32. K.K.S. VIII 11 11 - - 33. Officer Laborer IX 19 19 34. Security Guard VIII 02 02 - - 35. Security Guard IX 05 03 36. Sanitary Laborer VIII 02 02 - - 37. Sanitary Laborer IX 01 01 38. Coordinator 01 - 01
Total 415 405 06 04
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Land Reform Commission
Chairman
Executive Director
Management & Human
Resource Development
Division
Finance Division
Land Ceiling Land Alienation
Survey & Demarcation
Division
Valuation & Compensation
Division
Legal Division
Implementing the provisions
of the Act
Updating Documents
Investments Deeds Unit
Internal Audit Division
Investigation Division
i. L.R.C.D.O ii. Physical
Resource Administration
iii. Control of Vehicles
iv. Record Room v. Administration vi. Staff
Administration
I. Payment Division ii. Financial Control Division iii. Revenue Division
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A brief report on the tasks of each division of the Land reforms Commission and the progress of the tasks performed from 01st January 2010 to 31st December 2010 is given below.
1. Chairman’s Division and Executive Director’s Division • Chairman – Mr. Nimal G. Punchihewa, Attorney- at – Law • Executive Director – Mr. Hariguptha Rohanadheera, Attorney- at – Law
I. Obtaining approval and instructions required for all the tasks of Land Reforms
Commission II. Taking actions to solve problems of the public who visit the office. III. Formalizing the activities of the institution through coordination with the Ministry IV. Coordinating with His Excellency the President and Hon. Ministers.
2. Secretary’s Division
• Secretary – Mr. Senarath Wanigathunga, Attorney- at – Law I. Examining the Commission Papers submitted by all divisions of the Head Office and
referring them to the Director Board II. Obtaining reports of Director Board meetings and referring them to relevant divisions III. Calling project committees and keep records relevant to such meetings.
3. Management and Human Resource Development Division
• Director – Mrs. P.A.M.R. Chandrasekara
I. All administration activities relevant to all officers of the Land Reforms Commission II. Activities related to recruitments, promotions, transfers and salary increments,
personnel administration III. Activities related to coordinating with the district offices. IV. Performing welfare activities of the officers V. Fulfilling office needs and requirements VI. Carrying out daily office maintenance activities
Main tasks performed from 01.01.2010 to 31.12.2010
I. Management of organization structure and the staff of the institution II. Updating the recruitment procedure III. Training and development of the staff IV. Formalizing the district offices V. Implementing annual transfers VI. Establishing a methodical promotion scheme VII. Fulfilling office requirements
I. Management of organization structure and the staff of the institution Even though actions have been taken to get the approval on the organization structure, cadre and posts for a long period of time, it has become difficult to be implemented.
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Several attempts were made to find solution for this problematic situation by organizing discussion sessions with the Department of Management Services, National Salaries and Carders Commission, and with the Presidential Secretariat. on the instructions received at the discussion sessions with the National Salaries and Carders Commission it was informed to get the approval of the relevant to getting approval for the cadre and the cadre and the organization structure were presented to the Presidential Secretariat along with all necessary information. After a study done on the matters submitted, recommendation was given for the list of posts relevant to the approval of the cadre of the Land reforms Commission by the letter of the Secretary to H.E. the President no RDID/2/2/1/2 dated 30.11.2010 to the National Salaries and Carders Commission. II. Updating the recruitment procedure It was discussed with the National Salaries and Cadres Commission on getting approval for restructuring the cadre and since it was informed to restructure the recruitment procedure of the Land Reforms Commission, actions were taken to present a copy of the recruitment procedure to the National Salaries and Cadres Commission.
III. Development of the Staff • Around 120 officers were directed to follow English and Tamil language Courses
with the aim of improving skills, knowledge and experience of the staff. • A scholarship was offered to the Director Human Resources to follow a Diploma
Course in E- State Policy for Chief Modification Officers organized jointly by the Information Technology Institute of the Presidential Secretariat and the Postgraduate Institute of Sri Lanka, by the same institution.
IV. Formalizing the district offices
• The concept of S-5 was introduced to district offices in order to carry out activities efficiently and methodically and many offices have started implementing the concept.
• Actions were taken to provide computers and fax machines in two phases and to provide required office equipment for offices which have not received any, within few phases.
V. Implementing annual transfers
Actions have been taken to call application from the officers who expect to be transferred in accordance with the Transfer Procedure 2010 prepared relevant to the Land reforms Commission. Appropriately appointed Transfer Board has provided transfers for the officers with maximum justice.
VI. Establishing a formal Promotion Scheme It can be observed that there is a gradual development in all the tasks of the Commission as a whole. Attitude development of the staff, methodical work, studies, use of modern methods and technology can be noted especially. Accordingly it has been proposed to provide an absorption into grades or promotions for the officers who have satisfied qualifications following a formal method after getting the
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approval for new recruitment procedure and the cadre. It has also been proposed to recruit new suitable officers under new salaries for vacant posts after getting the approval for new recruitment procedure and the cadre.
VII. Fulfilling office requirements • Actions were taken to purchase 03 new cabs following prescribed
procedure, to carry out day today activities of the office in an effective way. • Actions were taken to update the files kept in the record room which had
been a great necessity. In addition to the main duties mentioned above, other daily activities such as recruitment of the staff and providing increments were carried out successfully and an exhibition stall was successfully maintained at Deyata Kirula National Development Exhibition held on 04th February 2010.
4. Internal Audit Division
• Under the supervision of Mr. T. Narendranadan Director (Acting)
I. Duties are performed as per the powers vested by the Subsection 01-03 of Section 2 of Part II of the Financial Regulation Of Land Reforms Commission which is compiled in accordance with the Land Reforms Act No. 1 of 1972 and the Finance Act No 38 of 1971.
II. Pre auditing of the payment of compensation and interest of the lands entrusted to the Commission
III. Assisting the future activities of the Land Reforms Commission by minimizing the flaws of final accounts
IV. Calling for information from relevant divisions and examining its adequacy for audit queries forwarded from the Auditor General and conducting inquiries for complaints forwarded Major tasks performed from 01.01.2010 to 31.12.2010
• Holding one Auditing and Management Committee due to delay in appointing the representative of Treasury to the Commission for the year 2010
• Correct methodologies of duties were established after few raids to district offices • Auditing files for paying compensation 12 • Auditing files for payment of interest 10 • Replying 10 audit queries and final report of the Auditor General received from the
Department of Auditor General with regard to year 2010 • Examining AL applications to prepare deeds
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5. Land Ceiling Division Director – Mrs. W.H.M. Kusum Herath I. Obtaining declarations from the persons who own lands of which the extent exceeds
the ceiling i.e. more than 50 acres of agricultural lands II. Separating 50 acres from the lands on the consent of the declarants for which the
declarations have been made by the declarants and provide such lands to them by way of publishing gazette notifications.
III. Providing lands for the children who are above the age of 18 as at 26.08.1972 of the declarant or to the parents of the declarant as per the request of declarants subjected to a ceiling of 50 acres as per Section 14 of the Land Reforms Act.
IV. Providing lands for the children of the declarant who are below the age of 18 as at 26.08.1972, but who held the ownership of the land, on the request of the declarant subject to Section 22 E of the Act.
V. Referring particulars of land which are alienated to the Commission after providing lands for legal obligations, to the valuation and compensation division in order to pay compensation
VI Settling matters which are remaining unsettled for three decades Number of legal obligations completed from 01.01.2010 to 31.12.2010
i. Issuing Statutory determination Gazettes under Section 19 16 ii. Drafting Gazettes 19 iii. Drafting of deeds for statutory determination transfers
under Section 22 (1) a 24 iv. Issuing deeds 24 v. Submitting draft deeds under Section 14 17 vi. Releasing deeds under Section 14 15 vii. Providing alternate lands for minors under Section 22 (1) a 02 viii. Releasing non- declarant lands 02 ix. Releasing lands of temples and devalas 03
6. Valuation and Compensation Division Under the supervision of Mr. J.W. Hapuarachchi Director (Acting)
i. Paying compensation in accordance with Land Reforms Act 01 of 1972 and amended acts
ii. Getting certified the accuracy of the ownership of land with regard to compensation iii. Investigations on ownership and division of compensation and on testamentary cases. iv. Paying of compensation for the lands alienated to the Commission from declarants v. Calling of government valuation reports for alienation and sale of lands
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Progress Physical Financial
Calling Valuation for selling and leasing of lands
89
Calling valuation from the Chief Valuer and Reporting valuation
26 Rs. 236,048,425.00
Valuation of Granite 01 Rs. 192,100.00 Revision of lease rent 28 Valuation of timber 29 Rs. 1,147,676.00 Payment of Compensation and Interest 10 Rs. 1,384,109.85 Valuation and service fees Rs. 2,458,604.25 Calculating compensation 02 Rs. 203,850.00
7. Land Alienation Division • Under the supervision of Executive Director • Mrs. Pushpa Karunarathne, Assistant Director • Mrs. Thusharika Sanjeewant Wadduwage, Assistant Director • Mrs. Anusha Chandanrathne, Assistant Director
i. Alientation of lands to persons for housing purposes ii. Selling/leasing of land to State Cooperations and Boards iii. Selling of land for agricultural purposes
Tasks performed from 01.01.2010 to 31.12.2010 I Sales Number of Persons Extent
A R P i. Referring to prepare deeds relevant to lands to be alienated for persons for housing purposes
1367 283 2 08
ii. Referring to prepare deeds relevant to lands to be sold to State Corporations and Boards
04 06 2 22
iii. Referring to prepare deeds relevant to lands to be sold to people (Paddy Fields)
06 04 3 27
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8. Projects Division
• Under the supervision of Executive Director • Mrs. W.K.K. Gunathilaka, Assistant Director
i. Lease of land on the prescribed methodology followed by the Land Reforms Commission in leasing lands (for projects)
ii. Referring the projects committee before leasing lands for projects. iii. Preparing relevant reports to obtain approval of the Director Board. iv. Submitting to the Minister in charge of the subject for approval v. Calling valuation reports vi. Recover the lease and provide a formal lease agreement.
v Actions have been taken to issue 38 survey orders for 497 acres 1 rood and 34 perches
for various projects from 01.01.2010 to 31.12.2010.
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Received letters Replies District
Num
ber
of le
tter
s re
ceiv
ed f
rom
di
stri
ct o
ffic
es
Num
ber
of le
tter
s re
ceiv
ed fr
om
pers
ons
and
othe
r in
stitu
tions
Num
ber
of le
tter
s re
ceiv
ed o
n Pu
blic
D
ay
Num
ber
of le
tter
s re
ceiv
ing
from
br
anch
es a
nd o
ther
way
s
Tota
l num
ber
of le
tter
s
Num
ber
of le
tter
file
d
Num
ber
of r
eplie
s to
par
ties
Num
ber
of c
allin
g of
rep
orts
Surv
ey o
rder
s Is
sued
Subm
itted
to p
roje
ct e
valu
atio
n co
mm
ittee
Subm
itted
to th
e co
mm
issi
on
Subm
itted
to th
e ap
prov
al o
f H.E
the
Pres
iden
t
Cal
ling
of e
valu
atio
ns
Exam
ined
the
file
s an
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nt to
ex
ecut
ive
dire
ctor
Tele
phon
e co
nver
satio
ns a
s pe
r th
e ad
vice
of E
xecu
tive
Dir
ecto
r
Sent
to p
repa
re d
eeds
of l
ease
Revi
sion
of l
ease
Num
ber
of le
tter
s to
be
repl
ied
Dis
cuss
ions
hel
d w
ith th
e ex
. Dir
Oth
er
Colombo 41 73 36 64 214 47 83 13 03 02 06 06 08 27 32 01 03 20 22 Kalutara 42 82 35 61 220 48 100 53 08 04 07 08 07 37 39 02 03 20 17 Gampaha 29 55 27 27 138 30 54 28 08 01 04 25 18 07 21 09 Galle 36 40 24 26 126 34 48 27 05 01 03 26 17 02 07 13 Hambantota 17 52 22 30 121 26 61 25 06 01 15 21 03 07 Matara Embilipitiya 14 89 35 40 178 46 92 39 06 06 07 05 05 26 22 02 28 28 Rathnapura Kegalle 50 95 51 51 247 32 110 62 03 02 02 04 25 25 01 06 07 07 Kandy 63 110 42 68 283 58 112 64 10 06 11 100
2 10 36 42 05 06 21 21
Nuwara- Eliya 74 81 60 73 288 37 116 77 08 01 06 03 02 23 30 03 40 12 Matale 58 63 37 51 209 39 90 51 01 01 02 05 12 11 02 28 04 Moneragala 05 06 01 12 04 05 02 01 01 03 05 Badulla Kurunegala Puttalam 54 73 63 56 246 62 76 47 03 07 09 01 08 24 16 14 06 Batticola 06 05 06 02 19 08 04 02 01 Anuradhapura 25 40 17 25 25 14 54 24 02 06 17 20 06 07 Trincomalee 11 15 18 31 08 02 Total 525 879 473 575 2452 51
6 1013
516 50 28 70 39 57 295 296 09 61 220
153
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Survey Orders issued from 01.01.2010- 31.12.2010 Serial No Date Institution/ Person District Name of the Land Extent 1 07.01.2011 R.P. Rajapaksha Rathnapura Maduwanwela
Nindagama 10 acres
2 04.01.2011 Bandula Senanayaka Puttalam Davulkurunda 38 acres 3 26.01.2011 T.K.N. Thushari ranasinghe Badulla Yelwerton Watta 40 perches 4 09.02.2011 Industrialists of Ministry of
Industrial Development Kuruneagla Puswelagawa
Mukalana 35 acres
5 11.02.2011 G.N. gamini Gunathissa M.R.M. Rifkhan
Puttalam Kombumunai Watta
10 acres
6 16.03.2011 Sri Lanka Telecom Kurunegala St. Bridget Watta 02 perches 7 16.03.2011 Land Reforms commission Kalutara Meddegedara
Watta
8 29.03.2011 Blue Bay Mineral International (Pvt) Ltd
Kandy Ambalamana Watta 25 acres
9 30.03.2011 H.A. Lalindra Thisera Puttalam Shermila Watta 20 acres 10 04.04.2011 M.K.L. Ranasinghe Kegalle Nagastenna Watta 18 perches 11 31.03.2011 District Office- Hambantota Gannoruwa Kahil
Watta All plots of free lands
12 06.04.2011 District Office Anuradhapura
Anuradhapura Periyakamathi Kani 24 acres
13 21.04.2011 M.D. Mekhala Darshani Kalutara Newchatel Watta 03 acres 14 11.05.2011 M.A. Anura
C.N. Vithanage Pichchai Chandran H.H. Dharmapala
Nuwaraeliya Peedru Watta 02 acres 2 roods 00 perches
15 11.05.2011 Lionel Gunathilake Rathnapura Epliyagoda Watta 24 acres 16 25.05.2011 Central Engineering
Consultancy Bureau Kandy Green wood watta Bare land
17 12.05.2011 W.G. Wimaladasa Rathnapura Epiliyagoda Watta 24 acres 18 10.06.2011 St. Sebastian Fisheries
Cooperative Society Puttalam Anawasana Group 01 acre
19 10.06.2011 M.I. Ammer Hammeza Puttalam Theliththoda Bazar 13 acres 20 13.06.2011 Pathberi Henford Watta Kegalle Heminford Watta 02 acres 2 roods 00
28
……………………….. perches 21 16.06.2011 Chandrasiri Vithanarachchi Rathnapura Maduwanwela
Nindagama 10 acres
22 10.06.2011 Etisalat Lanka (Pvt) Ltd. Kalutara Batawalakele Geekiyana Kanda
20 perches
23 21.06.2011 U.H. Sunil Hambantota Kurudana Watta 02 acres 24 27.06.2011 W. Gunasinghe Rathnapura Weraluketiyahena 01 acre 25 28.06.2011 International Buddhist
Centre Kandy Kandy Spring Hill Watta 46 acres 1 rood 06
perches 26 28.06.2011 R.A.C.S. Ranasinghe Kandy Rosshill watta 02 acres 27 07.06.2011 A.S. Aloka Bandara Puttalam Sinnathottam Watta 25 acres 28 10.06.2011 Director/ Nuwaraeliya Nuwaraeliya Peedru Watta 29 01.07.2011 Sarath Weerarathne Kandy Grrenwood Watta 15 acres 30 01.07.2011 B.A. Rathnapala Colombo Gulshana Watta 10 acres 31 05.07.2011 Sri Lanka Broadcasting
Cooperation Nuwaraeliya Peedru Watta 10perches
32 20.07.2011 B.R. Vijitha Kularathne Kegalle Yatideriya Watta 2 roods 18 perches
29
Alienation of Land Approved by Land Reforms Commission from 01.01.2010 to 31.12.2010 1 Kurunegla
15/6/515- A Phoenix Industries Limited Makadura Watta 06 03 33.48 Manufacturing
Plastic Items 2 Nuwaraeliya
15/6/5/893 Poththa Hannadige Nayana Ranga Dias
Watawala watta 25 0 00 Cultivation Project
3 Batticola 15/6/1400
S.M.S. Holdings Shnatha valeey watta / Kirimutti Watta
04 0 00 Manufacturing Cement Blocks
4 Puttalam 15/6/1510 -A
Kanro Coir Pvt Ltd Karanawa Watta 01 2 4.72
5 Nuwaraeliya 15/6/Projects/Gen
H.M. Dharmapala H.A. Anura P.N. Vithanage Pichchai Chandran Ranjanee Jayarathne Niroshan Saliya Kithsiri Kottegoda
Peedru Watta 60 perches 120 perches 60 perches 60 perches 60 perches 02 2 00
6 Kandy 15/6/4 Silica/ Gen
Blue Bay Mineral International Pvt Ltd
Ambalamana Watta 25 0 00 Silica Project
7 Badulla 15/6/1538
K. Niledra Thushari Ranasinghe
Yelwerton Watta 00 1 03.7 Manufacturing Cement Blocks
8 Kurunegla 15/6/1451
Ajith Bandara Thennakoon Welpitiya Watta 13 1 19 Agri Project
9 Matale 15/6/1363
S.M. Jayarathne Nandadeva U.K.G. Somawathie
Nikoloya Watta Extent remaining 20 perches
10 Puttalam 15/6/1565
St. Sebastian Fisheries Cooperative Society
Anwasal Group 01 0 00 Repairing Boats
11 Kandy 15/6/513- G
Kandy Tristar Plastic Industries Pvt Limited
Ulapane mahawila Watta
00 0 40 Manufacturing of Polythene
12 Kandy 15/4/4672
Bowalwawatta Vajirarama Aranya Senasana
Spring Hill Watta 30 0 00 Aranya Senansana
13 Kalutara 15/4/2/832
Vaduge Thilak Devasiri Yatadola Watta (St. George Watta)
00 3 11.2
14 Anuradhapura 15/6/report/..
1. 10 persons of the Chief Incumbent of Sirambewa
Nagollawa Paddy Land
2 acres each
Paddy Cultivation
30
rajamaha Viharaya 2. For 10 persons 3. Nagollawa Agri Village 4. Civil Defense Department Horowpathana
20 acres Remaining extent
15 Kandy 15/6/513 - D
Aktharee Industries Pvt Ltd Mahawila watta 101 2 00 Factory of flexible packing items and P.V.C. Pipes
16 Rathnapura 15/6/1130
K.T. Wickramasinghe Brampton Watta 10 0 00 Propagated Tea and agro cultivation programme
17 Galle 15/6/236
Intex Mode (Pvt) Ltd Gallinda watta 04 2 12.6
18 Puttalam 15/6/844- G
Bell Interiors Institution Karanawa Watta 00 1 22.5 Furniture and Pantry Cupboard factory
19 Gampaha 15/6/1426
Mrs. Arundathi Jayakody Galimure watta 12 2 35
20 Puttalam 15/6/844- E
Femto Industries Pvt Ltd Karanawa watta 00 2 00 Manufacturing Socks
21 Galle 15/6/1507
Bharati Airtel Lanka Pvt Ltd St. Leonard Watta 00 0 20 Communication Tower
22 Kandy 15/6/1536
Mr. P. Vijayan Little Valley Watta 00 3 00 For self-employment
23 Puttalam 15/6/1403 15/6/1403
P.S.Gamini Jayatissa M.R.M. Rifkhan
Kombumunai Kani Watta
10 0 00 Salt Project
24 Gampaha 15/4/23/1305
Saraswathi Buddhist Council Saraswathi Watta 20 0 00
31
9. Deeds Division
• Mr. Ernie Kithulgoda Yasathilaka, Deeds Consultant
i. Preparinglow income conditional/ unconditional deeds according to Sections 22(i) d (i) b, in the Land Reforms Act.
ii. Examining, signing and certifying the prepared deeds
Provision of deeds has been done in the following manner during the period of 01.01.2010 to 31.12.2010.
District Number of Deeds Colombo 148 Gampaha 343 Kegalle 238 Kalutara 274 Matale 78 Badulla 240 Kurunegala 116 Puttalam 297 Kandy 150 Nuwaraeliya 172 Anuradhapura 28 Batticola 11 Ampara 57 Trincomalee 27 Matara 158 Hambantota 48 Galle 106 Rathnapura 70 Moneragala 189 Embilipitiya 77 Total 2827
10. Surveying and Subdividing Division
• Mr. M.W.K. Dharmawardana, Director i. Supervising and giving instructions on surveying activities of all districts
examining and approving plans of each land. ii. Leasing, selling, statutory determination and issuing plans approved for the
alienation of land within families to relevant institutions. iii. Engaged in field duties in order to identify lands and for activities related to
boundaries of lands on requirement Revised number of Plans
Received number of Plans
Approved number of plans
Income received from surveying
95 598 503 620,000.00
32
11. Legal Division
• Mrs. W. E.V. Silva, Director • Mr. Udayasiri Rajapakshe, Director
Activities related to preparing files, presenting reports, engaging in activities related to proxies, appearing, providing legal instructions for various alienations, preparing deeds, preparing agreements on lease, and appearing for courts for 547 full legal cases filed against the Land Reforms Commission by the Supreme Court, Appeal Court, High Court, District Court, Magistrate Court, Labour Tribunal, Human Rights Commission and Ombudsman and other labour dsputes and the cases filed by the Land Reforms Commission against individuals and institution. No. of cases as at
01-01-2010 Cases
concluded/ settled during the year 2010
No. of cases filed during the year
2010
Cases pending as at 31-12-2010
Supreme Court 10 02 01 09 Appeal Court 48 01 10 58 High Court 39 - 07 46 District Court - 03 24 404 Magistrate Court 60 43 - 17 Primary Court - - - - Labour Tribunal 03 - 03 06 Labour Disputes 09 07 - 02 Human Rights Commission
11 09 - 02
Ombudsman - - 01 01 Total 563 65 48 547
12. Investigation Division
• Mr. Chaminda Rodrigo, Director i. Engaging in field examinations with regard to the land complaints made by
individuals and institutions ii. Calling related parties for investigations, conducting investigations and
proposing the most suitable solutions for such matters iii. Field investigations, site investigations and conducting investigations.
i. Number of field investigations conducted 21 ii. Investigations conducted within the office 38 iii. Number of investigations solved 10
33
13. Finance Division
• Mrs. Shyamali Rathnayaka, Director
i. Making payments of monthly salaries and allowances to all the officers in Land Reforms Commission
ii. Depositing E.P.F. and E.T.F. payments of the officers on time iii. Preparing monthly accounts reports and submitting to the Commission iv. Preparing monthly Bank Reconciliation Statements on time and submitting to relevant
institutions v. Referring monthly and annual accounts statements to the Auditor General and to the
Ministry vi. Spending the income received by the Land Reforms Commission only for most
important requirements and to invest the balance on productive means.
14. Revenue Division i. Collecting revenue received from lease and sale of land and taking appropriate steps to
recover lease in arrears ii. Collecting revenue received from mineral resources and other ways of income iii. Participating at Investigations on acquisition of lands and collecting revenue iv. Collecting of income from lands after finding particulars of such unidentified lands
Financial Progress of the Land Reforms Commission as at 31.12.2010
Description Year 2009 Year 2010 Lease of lands Rs.35,563,716.00 Rs.60,601,931.00 Lease of gem lands Rs.2,752,313.00 Rs. 3,410,005.00 Sale of lands and compensation on acquisition
Rs. 563,515.06 Rs.53,990,588.00
Other revenues Rs.21,326,325.00 Rs.21,268,449.00
34
LP/A/LRC/FA/2010/02 28 September 2011
The Chairman,
Land Reform Commission
Report of the Auditor General on the Financial Statements of the Land Reform
Commission for the year ended 31 December 2010 in terms of Section 14(2)(c) of the
Finance Act, No.38 of 1971.
----------------------------------------------------------------------------------------
The audit of financial statements of the Land Reform Commission for the year ended 31
December 2010 was carried out under my direction in pursuance of provision in
Article 154(1) of the Constitution of the Democratic Socialist Republic of Sri Lanka read
in conjunction with Section 13(1) of the Finance Act, No.38 of 1971 and Section 56 of
the Land Reform Commission Act, No. 1 of 1972. My comments and observations
which I consider should be published with the annual report of the Commission in
terms of Section 14(2)(c) of the Finance Act appear in this report. A detailed report in
terms of Section 13(7) (a) of the Finance Act was issued by me on 09 June 2011.
1.2 Responsibility of the Management for the Financial Statements
----------------------------------------------------------------------------------
Management is responsible for the preparation and fair presentation of these
financial statements in accordance with Sri Lanka Accounting Standards. This
responsibility includes; designing, implementing and maintaining internal
control relevant to the preparation and fair presentation of financial statements
that are free from material misstatements, whether due to fraud or error;
selecting and applying appropriate accounting policies and making accounting
estimates that are reasonable in the circumstances.
35
1.3 Scope of Audit and Basis of Opinion
-----------------------------------------------
My responsibility is to express an opinion on these financial statements based on
my audit. Audit opinion, comments and findings in this report are based on
review of the financial statements presented to audit and substantive tests of
samples of transactions. The scope and extent of such review and tests were
such as to enable as wide audit coverage as possible within the limitations of
staff, other resources and time available to me. The audit was carried out in
accordance with Sri Lanka Auditing Standards to obtain reasonable assurance as
to whether the financial statements are free from material misstatements. The
audit includes the examination on a test basis of evidence supporting the
amounts and disclosures in financial statements and assessment of accounting
policies used and significant estimates made by the management in the
preparation of financial statements as well as evaluating their overall
presentation. I believe that my audit provides a reasonable basis for my opinion.
Sub sections (3) and (4) of the Section 13 of the Finance Act, No.38 of 1971
give discretionary powers to the Auditor General to determine the scope and
extent of the Audit.
2. Financial Statements
-------------------------
2.1 Opinion
----------
In view of my comments and observations appearing in this report, I am unable
to express an opinion on the financial statements of the Land Reform
Commission for the year ended 31 December 2010 presented to audit.
2.2 Comments on Financial Statements
---------------------------------------------
36
2.2.1 Sri Lanka Accounting Standards
-------------------------------------------
The following observations were made.
(a) Although the provision for gratuity as at 31 December 2010 amounted
to Rs.31,913,642, the balance of the Sinking Fund Investment Account
existed in this connection amounted to Rs.5 million only. Thus, it was
observed that the Sinking Fund had not been maintained with the
corresponding provision for gratuity in terms of Accounting Standard
No.16. [
(b) The useful life, residual value, cost etc. had not been considered when
deciding the rate of depreciation in respect of some of the fixed assets of
the Commission in terms of Accounting Standard No.18.
(c) Six hundred and forty eight court cases had been filed as at end of the
year under review against the Commission and by the Commission on
various matters. Out of these, 104 cases had been settled. But, the
disclosures on contingent liabilities had not been made in respect of the
balance 544 cases in terms of Accounting Standard No. 36
(d) Lands acquired by the Commission had not been identified and brought
to account as investment property in terms of Accounting Standard
No.40. Even though the value of land in extent of 546,141 acres
belonging to the Commission as at 31 December 2010 had been shown
as Rs. 676,169,345, the Commission had not possessed a detailed
schedule or a Register of Lands in respect of these lands. In addition to
this, adjustments had not been made with regard to the cost on income
from sale of lands amounting to Rs.472,039,446 from the year 2006 to
the year under review. In this connection any information relating to
extent of lands had not been presented for audit. Accordingly, the
correctness of the value of lands shown in the financial statements could
not be confirmed in audit.
37
(e) Disclosures had not been made in the accounts whether the Commission
had adopted necessary accounting practices in order to maintain its
assets at the value not more than the realizable value in terms of
Accounting Standard No 41.
[
2.2.2 Disclosure of Accounting Policies
-------------------------------------------
The following observations were made.
(a) The policies relating to identification of revenue and accounting of
revenue had not been disclosed in the financial statements.
(b) The accounting policies used for valuation of stocks had not been
disclosed in the financial statements.
(c) A register containing detailed information on lands given under the lease
agreements had not been prepared.
(d) The fundamental basis such as cash basis or accrual basis followed in the
preparation of accounts had not been disclosed under the accounting
policies.
2.2.3 Accounting Deficiencies
--------------------------------
The following observation was made.
(a) Differences were observed between the value shown in the documents of
the Boards of Survey and the value shown in the financial statements in
respect of stock of stationeries of the Head Office. As a result, the value of
stock of stationeries had been overstated by Rs.327,706.
(b) The Lease Account and the Lease Suspense Interest Account had been
overstated by Rs.235,993 and Rs.14,893 respectively.
38
(c) Revenue on sale of lands had been overstated by Rs.213,280 and revenue
on sale of agricultural land had been understated by Rs. 245,400
(d) The revenue on administration charges and the revenue withheld as
reserves had been brought to account understating by Rs.31,620 while
transferring to the General Ledger.
(e) Lease rentals amounting to Rs.8,115,169 to be recovered for the year
under review from leasing out of lands had not been brought to account.
(f) Unsettled advances amounting to Rs.131,500 for the year under review
had been brought to account as expenditure.
(g) Although according to the files maintained by the Commission for the
rentals of the Head Office Building, rentals payable as at 31 December
2010 amounted to Rs.35,803,000, it had been shown in the financial
statements as Rs.10,680,000. Adjustments had not been made even during
the year under review in respect of building rentals amounting to
Rs.600,000 which had not been brought to account for the year 2009 on
the basis of undervaluation of building rent.
(h) Computers and software amounting to Rs. 1,402,040 purchased in the
year 2008 had been brought to account under office equipment and
adjustments for provision of depreciation amounting to Rs.166,319 had
not been made in order to correct this erroneous accounting entries.
(i) During the year under review any adjustment had not been made in
respect of doubtful debts and the balance of provision for doubtful debts as
at 31 December 2010 amounted to Rs.8,270,356 thus, representing 0.4
per cent of the total balance of the debtors.
39
2.2.4 Accounts Receivables and Payables
--------------------------------------------
(a) Adequate actions had not been taken to recover sums aggregating Rs.
2,140,531,267 remained outstanding for more than 09 years from various debtors
and recoverable from 9 institutions.
(b) According to the age analysis of debtors balances, action had not been taken for
more than 11 years to recover a sum of Rs.2,071,113,696 from the Government
institutions and Rs.2,921,575 from other various parties. Out of the current assets as
at end of the year under review, a sum of Rs.2,140,531,267 or 94 per cent had
consisted loan balances receivables and it represented 63 per cents of the value of
the total assets. Although the Committee on Public Enterprises in its meeting held in
the month of November 2008 and the audit report for the year 2009 had queried
about the action taken by the Commission to recover the outstanding amount,
proper action had not been taken to recover the above balances.
2.2.5 Un-settled Balances
-------------------------
The following Observations were made.
(a) The unsettled balances of the Compensation Suspense Account maintained for more
than 18 years under stage I and stage II totalled Rs.248, 096,381
(b) As the transfers of lands had been prohibited by the decision of the Cabinet of
Ministers No.CS/CP/26/2004,dated 22 July 2004, the advances amounting to Rs.
13,217,292 obtained from 470 persons in respect of transfer of lands had not been
settled.
2.2.6 Lack of Evidence for Audit.
40
----------------------------------
The following items of accounts could not be satisfactorily vouched /verified due
to non rendition of evidence indicated against each item.
(g) Although two institutions rendered the lowest quotations had been rejected considering
the weakness of their services when making selection of suppliers for the security services
of the Commission, any documentary evidence obtained thereon had not been presented
for audit.
Item of Account
--------------------
Balance
-----------------
Rs.
Evidence not Presented
----------------------------
(a) Debtors 2,140,614,380 Confirmation of balances
(b) Six items of fixed
assets
727,397,965 Boards of Survey Reports, Register of
Lands, Register of Buildings and
detailed schedules.
(c) Trade and other
payable expenditure
101,770,631 Age analysis and detailed schedules
(d) Motor vehicle Repair
Expenditure
4,377,171 Price enquiries and quotations
relating to repairs amounting to
Rs.3,645,120
(e) Compensation
suspense Account
248,096,381 Detail on the manner of arriving the
balance
(f) Sale of Timber 56,222 Documentary Evidence relating to
valuation of timber
41
2.2.7 Non - compliance with Laws, Rules, Regulations etc.
------------------------------------------------------------------
Instances of non- compliance with the following laws, rules etc. were observed.
Reference to Laws, Rules,
Regulations etc.
--------------------------------------
Non- compliance
---------------------
(a) Finance Act No.38 of 1971
--------------------------------
(I) Paragraph 11 of the Finance Act
and the Public Enterprises
Circular No.PED 25(1) dated 10
August 2004
(II) Sub section 7 of Section 13
(8) of the Finance Act
The required approval had not been obtained in
respect of investments amounting to
Rs.404,388,972.
The report of the Auditor General in terms of
Section 13 (7) (a) for the year 2009 had not been
discussed by the Commission and the action taken
thereon had not been reported to the Auditor
General.
(b) Government Financial
Regulations
--------------------------------
42
(I) FR 371 (2)
(II) FR 1646
(III) FR 502 (2)
Advances amounting to Rs.1,125,247 had been
granted to the non staff grade officers during the
year under review.
Running charts and monthly summaries in respect
of 14 vehicles had not been presented to the
Auditor General chronologically.
Register of fixed Assets containing the information
such as cost, identification code, date of
acquisition, rate of depreciation per annum and
installation had not been maintained in respect of
each item of fixed assets.
(c) Circulars
----------
I. Treasury Circulars
i. Public Enterprises Circular
No.PED 12 dated 02 June
2003
i. The Commission had approved food and
lodging allowance to the Chairman and the
Acting Executive Director at the rate of Rs.2,000
and Rs.1,500 respectively contrary to the circular
provision.
ii. Even though according to the Public Enterprises
Circular No.PED 12 dated 02 June 2003, an
Executive Officer could obtain fuel subject to the
43
II. Public Administration Circular
i. Paragraph 1(6) of the
Circular No. 22/99 dated 08
October 1999
maximum of 190 liters of diesel per month, the
Acting Executive Director of the Commission had
used 2754 liters of fuel exceeding this limit
without the approval. In this connection
additional expenditure incurred to the
Commission amounted to Rs.243,199.
Even though according to the Circular instruction
the Deed Adviser of the Commission appointed
on temporary basis could not obtain the official
vehicle facilities, he had used a vehicle to travel
to and from residence and he had utilized
1820.54 liters of fuel from the month of January
to December 2010. The expenditure thereon
amounted to Rs.132,900.
In this connection the Chairman had reported as
follows.
“It was informed to the relevant Divisions to
furnish the detail of the quantity of fuel in excess
of the approved limit to the Board of Directors.
An Evaluation Committee should be appointed to
evaluate the disposable assets and determine the
minimum bid for them. At least three members
44
ii. Section 2.3.1 of the Circular
No.353(5) dated 3 January
2003
iii. Section 02.1 of the Circular
No.09/2009 dated 16 April
2009
should be consisted in this regard. Even though
an Engineer / Technical Officer and as more
suitably an Officer of the Department of
Valuation or at least an Accountant should be
consisted, action in terms of this Circular
provision had not been taken in respect of
market valuation of the Narangollae Estate, tea
factory amounting to Rs. 1,900,000
Even though all the Government employees
including Head of the Institution should prove
their arrival and departure through thumb mark
printing machine, the Acting Executive Director
and the Deed Advisor had not done accordingly.
The Acting Executive Director had used pool
vehicles in addition to his official vehicles.
According to the lease agreement it was
mentioned that if the lessee has failed to pay
lease the lease agreement is terminated
automatically and the relevant lease agreement
should be cancelled. Even though a private
company had defaulted the lease payment from
October 1993 to Year 2005 action had not been
45
iv. Circular No.11/2006 dated 14
July 2006
III. Circular of the Presidential
Secretariat
Section 8(c) of the Circular
No.SEI/A/4/34 dated 21 July
1995
taken accordingly.
(d) Section (c) of the Nation
Building Act No.09 of 2009
Even though according to the Nation Building Act,
tax should be recovered from any person carrying
out business which provide any nature of services,
action had not been taken by the Commission in
accordance with this provision.
(e) Government Procurement
Guidelines
-----------------------------
I. Section 9.3.1 (b)
Even though approval of the Secretary of the Line
Ministry should be obtained for repairs exceeding
Rs.100,000, such approval had not been obtained
for vehicle repairs made in 4 instances by spending
Rs.1,289,309.
46
(f) Establishments Code
-------------------------
Section 13.3 of Chapter II
Although acting appointment could be made as a
temporary measure until the permanent
appointment is made, the acting period of three
officers of the Land Reform Commission had
exceeded 3 years and a sum of Rs.230,760 had
been paid as acting salary. The Chairman informed
in his reply that applications for the relevant post
had been called for but the activities of recruitment
was failure as no one willing to join the service with
the relevant salary steps.
3. Financial and Operating Review --------------------------------------
3.1 Financial Review ----------------------
3.1.1 Financial Results -----------------------
According to the income statement presented, the working of the Commission for the
year under review had resulted in a surplus of Rs. 10,221,761 as compared with the
corresponding surplus of Rs. 22,585,948 for the preceding year, thus indicating a
decrease of Rs. 12,364,187 in the surplus or 55 per cent. A comparison of figures of the
income statement for the year under review with those of the previous year, shows that
the decrease in other operational income (fixed deposits) from Rs.50.3 million to Rs.36.9
million and increase in administrative expenditure from Rs.141.4 million to Rs.154.8
million and increase in other operational expenditure from Rs.3.4 million to Rs.5.5
million had been the reason for decrease in surplus.
47
(b) After making adjustment for changes in working capital, 50 per cent decrease was
observed in the net cash flow from operating activities.
3.2 Operating Review
-----------------------
3.2.1 Performance
---------------
(a) According to the Action Plan, the performance report showing the targets the
manner of achievement of progress had not been presented.
(b) Action had not been taken during the year under review in respect of 04
activities included in the Action Plan for the year 2010.
(c) The percentage of non-achievement of performance in respect of 09 activities
included in the Action Plan for the year 2010 had been at the higher range
between 54% to 83%. As such it was observed that the purpose of the Action
Plan had not been properly fulfilled.
3.2.2 Management Inefficiencies
----------------------------------
(a) A programme had been introduced for providing lands to the employees of the
Commission with the purpose of welfare of the employees based on the decision of
the Commission. Even Though more than 4 years had elapsed, action had not been
taken to provide lands for the advances amounting to Rs.3, 584,600 obtained
from them for sale of lands.
(b) It was observed that considerable amount of cash had remained idle in the Bank
Current Accounts of the Commission during the year under review and in those
instances more than Rs.20 million had remained idle for more than 3 months
period. As a result, the interest income that could be earned by investing the above
amount effectively had been lost.
(c) An Advisor of the Deed Division had been appointed on assignment basis for three
months period with the approval of the Commission from the month of June
48
2007. Even though it was informed that not to make recruitment for posts
without the approval of the Department of Management Services, his service
period had been extended from time to time from the month of December 2009 to
June 2011. Adequate information were not made available in the personal file to
confirm the qualification of this officer. According to the condition of the
recruitment, monthly report for his duty had also not been submitted by him.
Further, according to the information of the vehicle running charts submitted for
audit, the amount spent for him for fuel was Rs.273,650.
(d) Several files relating to activities completed and non-completed had been stored at
the record room in an improper manner. As a result, there was a risk of
misplacement of files of the Commission.
(e) Even though it was mentioned in the running chart by the Driver that the vehicle
No.53 – 9673 had been used for a distance of 274 k.m after handing over it to the
garage for repairs, in this connection any action had not been taken by the
Commission.
(f) The Government had lost very large amount of tax of Rs.16,712,517 due to non-
registration of the Commission for the Value Added Tax in terms of Value Added
Tax Act No.14 of 2002.
In this connection the Chairman had reported in the following manner.
“The Commission is not an institution with the main purpose of earning profit and
it provides lands to the helpless and needy people. In the same way if this tax is
recovered, it would be recovered from the general public. As a result, this was a
difficult activity.”
3.2.3. Identified Losses
---------------------
A sum of Rs. 1,700,000 paid during the year 2007 to obtain a computer software
package had been brought to account as advance up to 31 December 2010. It was
49
revealed in audit that the investigation is being conducted by the Department of
Criminal Investigation in respect of this payment. In this connection any disclosure had
not been made in the financial statements.
3.2.4 Operational Inefficiencies
---------------------------------
(a) Eight hundred and sixty nine plots of lands with several problems such as lands
for which information could not be found, lands not transferred, lands for
which the present information were not made available, were observed at the
review of Registers prepared in respect of lands belonging to 6 District Offices.
(b) Leasing out of Waljapala Estate at Minuwangoda for an Industrial Park during
the year 1998
--------------------------------------------------------------------------------
------------------
Land in extent of 15 acres, 1 rood and 4 perches had been vested to the
Industrial Ministry in respect of 13 industries. In this connection the following
matters were observed.
I. The amount of lease from one institution had been under recovered due
to under computation of the extent of land leased out by 1 rood 33
perches.
II. The lease amount had not been recovered from two institutions. The
Chairman informed me in the month of March 2011 that action is being
taken to obtain the date of handing over of possession from the Ministry
and to recover cash from that date by entering into a lease agreement.
III. The lease amount recoverable from a company amounted to Rs.211,688
whereas two companies had failed to pay the lease amount but,
surcharges had not been recovered. Even though the recovery of
surcharge was implemented as a procedure of the Commission, the
Chairman informed me that the recovery of surcharges is difficult at the
instances of non-inclusion of such a condition in the lease agreement.
IV. The lease amount of 4 plots of land had to be revised. As a result, a
considerable amount of income to be recovered by the commission had
50
been lost. The chairman informed that action is being taken to revise and
recover.
(c) Mirigama Batagolla Estate and Renagala Estate
The following matters were observed
I. Even though 50 acres and 26 perches of this land had been leased out to a
Plantation Company in the month of January 2004, the lease amount had not
been recovered for a land in extent of 02 acres and 26 perches. The Chairman
informed me in the month of February 2011 that the legal action could not be
taken to recover the outstanding amount relating to that plots of land until a
development or utilization is taking place due to not handing over of possession
legally.
II. Payment of lease amounting to Rs.369,600 had been defaulted by this Plantation
Company from March 2009 to March 2010 and the surcharge not recovered
up to March 2009 amounted to Rs.6,100.
III. Timbers existed in the land assessed at Rs.52,222 had been sold to the lessee for
a sum of Rs.34,000 in the year 2005 and the lessee had also functioned as the
member of the Tender Board. The Chairman informed me in the month of
February 2011 that it was accepted that the transaction had not been carried
out openly and correctly and action had been taken for not occurring such
situation.
(d) Johnsland Estate Land
This land belonging to the Board of Authority of the Gampaha District had been vested
from the month of August 2009 and the lease amount for the period 2009 – 2013 was
Rs.1,930,500. It was observed in audit that the lease amount along with the surcharge
to be recovered from the year 2009 up to the month of December 2010 amounted to
Rs.810,810
(e) Bothale Estate Land
A land in extent of 05 acres and 29 perches had been leased out from the year 1998
and annual lease for the years from 2003 to 2008 amounted to Rs.6,075. The
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Chairman informed me that the lease amount had been revised from the year 2010
after obtaining the assessment value through the Government Chief Valuer for the new
lease agreement.
3.2.5 Corporate Plan
----------------
The following matters were observed according to the Corporate Plan prepared for the
period 2011-2015.
(a) When preparing Corporate Plan, action had not been taken in accordance with
Section 5.1.2 of the Public Enterprises Circular No.PED 12 dated 02 June 2003.
(b) When preparing Corporate Plan, the surplus shown in the financial statements
from the year 2005 had been given incorrectly.
(c) Even though it was shown that the Corporate Plan submitted, had been prepared
for the period from 2011 to 2015, income and expenditure for the years 2013 to
2015 had not been forecasted in the Corporate Plan.
(d) Ten activities for which details of physical and financial targets expected to
achieve each year were not reflected in the Corporate Plan, had been included in
the Corporate Plan. Accordingly, it was observed that attention had not been paid
by the Commission for achieving objectives expected in the Corporate Plan in
accordance with paragraph 5.1.1 of the Public Enterprises Circular No.PED.12
dated 02 June 2003.
3.2.6 Budgetary Control
-----------------------
Significant variances were observed between the estimated income and expenditure
and the actual income and expenditure thus, it was observed that the budget had not
been made use of as an effective instrument of management control.
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3.2.7 Personal Management
----------------------------
Although the approved cadre of the Commission stood at 190, the actual cadre of the
Commission as at 31 December 2010 stood at 412. Accordingly, excess cadre stood at
231. All these excess employees had been granted permanent status during the year
2009 based on the decision of the Commission subject to the covering approval of the
Salaries and Cadre Committee of the Department of Management Services without
amending the approved cadre. However, the approval had not been obtained thereon
up to April 2011. As a result, salaries and wages had been paid for 231 employees in
excess of approved cadre.
3.2.8 Internal Audit ---------------
(a) Even though an Internal Audit Unit of the Commission is operated, the post of
Chief Internal Auditor had remained vacant from the month of February 2007.
(b) Even though it was planned to operate the internal audit in order to cover the
activities of the Finance Division, activities of the Land Maximum Limit Division,
activities of annual budget estimate, activities of vesting of land and activities of
rectification of deficiencies reported by the Auditor General for the year 2010,
those activities had not been carried out as planned.
3.2.9 Audit and Management Committee ----------------------------------------------
The Commission is functioned under the Presidential Secretariat but a representative of
the Secretariat had not participated in the meetings of the Audit and Management
Committee.
4. Systems and Controls ----------------------------
Deficiencies in system and controls observed during the course of audit were brought
to the notice of the Chairman from time to time . Special attention in needed in respect
of the following areas of control.
(a) Accounting
(b) Fixed assets
(c) Interest Income on Fixed Deposits
(d) Activities of the Land Division
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(e) Vehicle control
(f) Record room
(g) Recovery of Debtors Balance
(g) Granting Advances
(h) Investment of Surplus Funds
H.A.S. Samaraweera
Auditor General
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2/1/102 LP/A/LRC/FA/2010/02 04.08.2011 Auditor General Department of Auditor General, Independence Square, Colombo 07. Report of the Auditor General as per Section 14 (2) (c) of the Finance Act No 38 of 1971 on Financial Statement for the year ending at 31st December 2010, of the Land Reform Commission Reference the Report of the Auditor General of even number dated sent to me o the above matter. Answers for the issues inquired in the said report are given below. 2. Financial Statements 2:1 Opinion 2:2 Clarification regarding the Financial Statements 2:2:1 Sri Lanka Accounting Standards a) The gratuity of the officers should be paid after resigning from the service. Accordingly,
those allocations have been indicated under current liabilities. Even though they have been indicated under current liabilities in each year in the accounting process, it has not been noted in any year that should not be indicated as a current liability. However, instructions have been given to rectify it in future.
b) Generally the payment of gratuity is made from the recurrent account. The Land Reform Commission possesses an investment of Rs. 5 Million maintained specially for the payment of gratuity. Relevant money which is for such allocation has been invested in short term fixed deposits.
c) When the fixed assets of the Commission are depreciated, the productive lifetime and cost of the assets, etc have been taken into consideration. However, it has become difficult to find information on certain old assets included in fixed assets (information on the purchase). Therefore, it is difficult to adjust debris value.
d) Allocations cannot be made in this regard since it is impossible to state the dates on which the court decisions would be issued regarding the cases of the Commission and further some instances are reported where certain cases are concluded without making any payment. It is also impossible to forecast the number of cases which would be filed. Further, it has become impossible to make allocations since payments have been made as a whole in some cases.
e) As per Accounting Standards No. 40, the cost of land which have either been sold or leased has not been identified. This problem has not yet been solved due to the inability to regularize the adjustments made for the lands taken over by the Commission. However, it has been noted to make proper investments identifying the correct value of lands once the Register of Land which is at present been prepared is updated.
f) It has become difficult to identify the items and the year of purchase in relation to the cost of certain fixed assets. 50% of the value of certain assets and welfare items has now been depreciated. Further, it has become problematic to remove the debris value of such items. Therefore, relevant officers have been instructed to take a decision in this regard in due course.
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2:2:2 Revealing Accounting Policies a) The money received in the selling of land or leasing is accounted on accrued basis and
at certain instances on cash basis. b) Weighted average price method was applied for valuation of stock. It was noted to
reveal them in financial statements in future. c) It was noted to submit a description on contingency liabilities along with financial
statements. d) Since, the register of lands is being updated, it is hereby informed that particulars of
lands can be provided once the task is completed. e) Income on investment (interest) has been shown on accrued basis. f) When accounts are prepared the income and expenditure are calculated on accrued
basis. Since, the particulars of certain expenses have not been received even at the time of preparing accounts, it has to follow the cash basis at such occasions.
2:2:3 Accounting Deficiencies 2:2:3:1 Under and Over statement in Accounts a) When stock verification is made on stationeries, the remaining stock at the main office
as well as District offices was accounted as at 31st December. Accordingly, the value of the stock of stationery has not been over estimated by Rs. 327,706/-.
b) Since, the percentage of the recovery of lease on value added basis in 2009 has been reduced from 15% to 12.5% the adjustments in accounts in relation to the vehicles obtained on lease have been correctly made. Since, the information is not sufficient to inquire on the money indicated by you under this, you are kindly requested to provide us necessary information.
c) The over estimation by Rs. 213,280/- which has been made when the income of land sales is transferred from relevant accounts to common ledger and the under estimation of the income on sales of paddy lands by RS. 245,400/- is an inadvertence occurred due to the confusion of classification. Therefore, it has been noted to rectify the same.
d) It has been noted to rectify the under estimation of Rs. 31,620/- which has been made when revenue on administrative expenses and the revenue retained as reserves have been included in the common ledger in the preparation of accounts in year 2011.
e) The withholding tax of Rs. 1651175/- has been included in Rs. 36918042.65 which is the income of interest on fixed deposits. Therefore, no reduction is occurred in the revenue of interest.
2:2:3:2 Deficiencies in accounting a) The normal practice is to account the money collected as advances in the relevant
category of expenditure once such advance is settled. Since, such settlement has not been made at the time of preparation of the advance account indicated under this section, it has been mentioned that money has totally been spent. Therefore, that advance has been accounted at that time as expenses due to above reasons.
b) Several discussions have been made with the additional Secretary, Public Administration regarding the rental for the Head Office. Since an approval was seemed to be granted to alienate the building to the Commission, the total valuation amount has not been accounted in year 2009. At present it seems that it would be allowed to pay the due amount on installment basis as per the discussions, relevant officers have been informed to account this adjustment correctly once instructions for payments are received in writing.
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c) When entries of the purchase of computer appliances in 2008 are rectified, the adjustment of depreciation equivalent to Rs. 166,319/- has been omitted by mistake. Therefore, it has been noted to rectify the same in due course.
d) It was impossible to find information on the cost of the photo copier which has been removed and the accumulated depreciation value of the same. Therefore, the total value of exchange was treated as the profit on the supposition that the machine has totally been depreciated.
e) Instructions have been given to minimize the balances of debtors as far as possible in 2012 and further to make allocations at the end of the year.
2:2:3:3 Omission from Accounts a) A lease rent of Rs. 8,115,169/- has been accounted. It has been indicated an amount of
Rs. 9,385,241/- as the lease rent to be recovered during the year under review since, the above amount and the amount to be recovered for the previous year have been included in the account.
b) In the withholding tax existed as at 21st December 2010, an amount of Rs. 225/- recovered in relation to year 2009 has been adjusted to the opening balance by way of accounting the payment in year 2010. In addition to the above, a lease rent of Rs. 12171/- has been paid relevant to the payment of compensation. However, it is an amount which has to be paid several years before. It has been adjusted by the payment of compensation. Accordingly, relevant adjustments have been made.
2:2:4 Accounts Receivable and Payable a)b) Maximum effort has been made in respect of the recovery of money which are due
from Public and other institutions mentioned under miscellaneous debtors. A request has been made from the Secretary to H.E. the President to call for discussion with relevant parties including the General Treasury regarding the recovery of amount in arrears. Accordingly, Presidential Secretariat has requested the particulars of the outstanding amounts. Therefore, they have been submitted. In addition to the above, action has been taken to recover such amounts separately from each institution. Action taken in this regard is given in Annex 01.
c) The income on lease rent has also been accounted under the income receivable. 2:2:5 Inappropriate revealing Even though lands have been taken over under Land Reform Act No.1972 correct
register of land has not been prepared. It seems that certain statistics have been included without doing any survey or verification of ownership, but based on the declarations made by the declarants. Therefore, accurate documents are not available on the specific extent of lands taken over and removed.
Accordingly, it has become impossible to submit particulars regarding the documents or calculations. However, at present, a register of lands is being prepared by way of obtaining reports from the District and using existing information. It is expected to take further action once the register is prepared.
2:2:6 Unsettled Balances a) The reasons for the inability to settle balances are the defects in the certificates for
accepting the possession of the lands, non-confirmation of the ownership of lands by the declarants, failure of the declarants to show their lands and cases filed at the courts. In addition to the above, a higher interest has to be paid as it was impossible to settle this balance due to the disputes and cases which were remaining unsettled and the testamentary cases. The inability to make settlement is due to reasons beyond our control.
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b) The alienation made during the period from 2002 – 2004 have been cancelled by the Cabinet memorandum of No. CS/CP/26/2004 dated 22nd July 2004. Further, certain applicants have made requests from the Commission to provide them the lands legally since, they have developed properly their lands.
c) Having examined the development activities of such lands several requests have been referred to the Commission in order to provide such lands on lease. Then those decisions have been submitted for the approval of the Minster in charge of the subject. Since, a decision should be taken by the Cabinet in order to change any decision taken by the Cabinet, the Secretary to H.E. the President has informed by the letter No. RD/2/2/1/1/2/52 dated 17.09.2009 proposals of the Commission regarding the lands to be re- alienated for the approval of H.E. the President and then a Cabinet memorandum can be submitted. Accordingly, a Commission paper bearing No. 2544 dated 21.03.2011 has been submitted containing the proposals and the present condition of such lands. Further, the decision of the Commission has been referred to H.E. the President on 02.05.2011 for further action to be taken when a revised paper is submitted to the Cabinet of Ministers. Accordingly, the decision of the Cabinet of Ministers has so far not been referred to the Commission for further action.
2:2:7 Lack of evidence for auditing
a) Even though, the letters have been sent to the debtors for the confirmation of balances, no reply is received. Further, certain instances have been reported where such letters could not be delivered.
b) I- II It is noted to submit the registers of lands indicated under fixed assets after updating the same. The reasons for the balance of buildings of Rs. 4207822/- are the additions made to the buildings at Head Office and the cost borne for the buildings at Monergala office.
b) III-IV Even though, it has been indicated that evidences have not been provided for the Board of Survey on motor vehicles, office equipments, furniture, fittings welfare equipment, relevant reports have been submitted to you at the auditing. Further, you are hereby informed that it is possible to submit them at any occasion.
b) VII Even though, you have stated the purchase of computers to the value of Rs. 104,160/- the actual purchase has been a photo copier. Quotations have been obtained from the suppliers for the purchase of that photo copier.
c) Loan advances I) Even though, it has been informed by the letter dated 04.01.2011 to send
confirmation of balances to the amount of Rs. 300,000/- retained for the Lady Lohore Fund, no reply has been sent. That institution has requested confirmation from us by the letter dated 06.05.2011. Accordingly, we have sent them a reply and a copy of the same is attached herewith.
II) An amount of Rs. 185,000/- has been kept at filling stations in the following manner.
Niroshana Enterprises (Pvt) Ltd - Rs. 75,000.00 S.R. Dinamithra - Rs. 100,000.00 C. Wickramathunga - Rs. 10,000.00 Rs. 185,000.00 d) e) The representatives of the Treasury in Audit and Management Committee has
informed not to make allocations for bad debts. Therefore, no provision has been made for bad debts in 2010. Further, it is noted to submit time analysis regarding trade and other expenses to be made.
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f) The normal procedure is to take necessary action for repairing vehicles after calling quotation and bids. Action has been taken accordingly.
g) It is a problematic to determine the payment of compensation at one and the same occasion. Therefore, it has become impossible to submit written evidences to confirm the balances.
h) Relevant quotations are attached in the file in relation to the amount of Rs. 56,222/- mentioned by you. They can be submitted at any occasion.
i) An advance of Rs. 100,000/- has been provided to the Executive Director on my approval to bear incidental expenses at the ceremony for the awarding of Ranbima deeds in Hambanthota on 18.12.2010. Certain amounts of the advance should have to be provided to District Directors and the Officers at the Head Office who organise the ceremony to bear relevant expenses. The supervision on bearing of such expenses was entrusted to Executive Director. Only the essential expenses have been borne by that advance. However, due to the delay in submitting bills by the District Directors and certain officers at Head Officer to the effect that such expenses have been made, relevant advance could not be settled. The advance of Rs. 100,000/- obtained by the Executive Director has been settled on 19.04.2011 with some delay.
The advances obtained by the Executive Director on 02.07.2010, 30.07.2010 and
20.10.2010 should be settled after the prescribed duty, I have been reported that the settlement of bills was delayed due to the higher work load entrusted to the Executive Director and misplacing of certain bills.
Due to the delay occurred in finding misplaced bills, it could not settle this advance
on due date. However, on receipt of relevant bills, the advance obtained by the Executive Director has been completely settled on 25 and 2604.2011. Further, necessary instructions were given to relevant divisions to avoid such situations in future.
j) The stock verification to be carried out as at 31.12.2010 has been concluded at the
time of auditing. However, necessary information can be provided wherever necessary.
k) The Tender Board which held a meeting on 02.02.2010 to take a decision regarding the quotations received for supply of security services for year 2010 at the Head Office of the Land Reform Commission has revealed that the service provided by two institutions that made quotations was not satisfactory by communicating with the institutions over the phone which obtained the services from these two institutions. The members of the Tender Board have communicated over the phone with the institutions regarding the security services which have obtained such services from Reliable and Alert Security Services (Pvt) Ltd and Commercial Fields Security Services (Pvt) Ltd, which have provided the minimum quotations. The Directors of Management and Human Resource Development of the Department of Irrigation and Department of Pensions who have obtained the security services from Reliable and Alert Security Services (Pvt) Ltd and Directors of Management and Human Resource Development of the Department of Examinations and National Film Cooperation who have obtained the security services from Commercial Fields Security Services (Pvt) Ltd have informed that the service of above institutions is not satisfactory.
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Having taken into consideration the fact that above statements have been made by responsible officers of those institutions, the Tender Board decided to obtain the services for year 2010 from United For Security (Pvt) Ltd which is the third lowest bidder, even though there were no written evidences. However, it was taken into consideration the fact that above institution provides service for more than fifteen institutions during the period of more than five years in the field.
2:2:8 Non Compliance to the Rules and Regulations a) Finance Act No. 38 dated 1971
I. Para II of Finance Act and Public Enterprises Circular No. PED25(1) dated 10 August 2004. Approval of the Commission as well as the Hon. Minister of Finance and the Line Ministry has been obtained before the investment of income in excess of the Land Reform Commission.
II. Sub Section 7 of Section 13(8) of the Finance Act. Action has been taken in year 2009 to avoid weaknesses by way of submitting the report a, 13 (7) to the Land Reform Commission. The officers have been instructed to report to the Auditor General regarding such situations.
III. 13(5) (c) of Finance Act and FR 134 (2) The Internal Audit Plan has been prepared for year 2010 and it has been submitted to you on 10.03.2010.
b) Financial Regulations of the Government (I) FR 371 (2) I.I Even though, action has been taken to provide advances to officers in non staff Grade when such advances are provided as per FR 371(2), the supervision over such advances has been entrusted to a Staff Officer. Further, when such advance is provided, it is recommended and certified by a Staff Officer. Also it is supervised by a Staff Officer to verify that such advance is utilized strictly for the prescribed purpose. It has been observed that the officers obtained advances have utilized such amount properly and further made only the necessary expenses. However, it has been informed to the officers to refrain from issuing advances to officers in non staff grade. I.II Advances over Rs. 20,000/- have been provided only at the essential occasions such as awarding of deeds and building of stalls at Deyata Kirula exhibition for which higher expenses have to be made. Otherwise advances over Rs. 20,000/- have not been provided to officers in non staff grades. However, such instances have occurred only under the situations where it has become impossible to determine the expense to be borne for the duty entrusted to. However, at the instances where the total amount of advance has not bee spent action has been taken to settle the reaming amount. Further, relevant divisions were informed to make a proper estimate regarding the task to be performed before applying for advances in future. (II) Even though, the advance obtained as per FR 371(2)(a) should be settled
again once the prescribed task is concluded, such settlement has not been made properly due to the nature of duties entrusted to the officers who
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obtained such advances and performing duties outside the office. However, relevant officers were instructed to avoid such situations in future.
The advances obtained by the Executive Director should be settled after the prescribed duty, I have been reported that the settlement of bills was delayed due to the higher work load entrusted to the Executive Director and misplacing of certain bills. Due to the delay occurred in finding misplaced bills, it could not settle this advance on due date. However, on receipt of relevant bills, the advance obtained by the Executive Director has been settled on 19.04.2011, 25.04.2011 and 26.04.2011 submitting relevant bills.
(III) Monthly summaries have been prepared for all the vehicles except several vehicles in accordance with the running charts used for the vehicles belonging to the vehicles. The running chart books used for the vehicles are returned back once the chart is complete. However, it has become impossible to prepare summaries due to delay occurred in returning of such charts after the performance of duties. Preparation of monthly summaries of running charts of the vehicles has been delayed in several months only. All the running charts relevant to the period of non preparation of summaries have been taken to the custody of the officers of your division. However, all those running charts have also been received at present by this office. It is hereby informed that the monthly summary of running charts of all the vehicles belonging to the Commission has been prepared for year 2010.
(IV) FR 502 (2)
Fixed assets registers containing particulars mentioned under this are at present maintained.
(V) FR 104 Preliminary activities have been commenced as per FR 104 regarding the accidents occurred to the vehicles bearing No. 57-2404 and 53-9673. You will be informed once the report of the inquiry is received.
c) Circulars
I) Treasury Circulars The expense of Rs. 791,477/- indicated under this has been borne for the stationeries obtained in 2009. The Rainbow Stationery relevant in this regard is the institution which was granted approval of the Tender Board in 2009. It should be noted that most probably the purchase of stationeries has been made in year 2010 from the National Paper Cooperation.
II) Having taken into consideration the duties performed by Chairman and Executive Director outside the office specially even in very remote areas, at the meeting of the Commission held on 12.08.2009, it was discussed widely to make payments for
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reimbursement of expenses borne by them whilst on duty as personal to them. Accordingly, approval has been given to pay Rs. 2000 and Rs. 1500 for Chairman and Executive Director respectively for accommodation per day and Rs. 1500 and Rs. 1000 for Chairman and Executive Director respectively for meals when performing duties outside Colombo. However, Public Enterprises Circular No. PED/12 dated 2nd June 2003 was not made applicable for this purpose. It is hereby informed that we are compelled to go for such alternative since the officers have to personally bear expenses for meals and accommodation when they perform duties outside Colombo and further various difficulties are observed in the reimbursement of such expenses by way of submitting bills. However, instructions have been given that action should not be taken in future for such payments.
III) Public Administration Circulars i) Log entry books are maintained for all the vehicles belonging
to Land Reform Commission. However, at certain occasions a delay is observed in making such log entries due to heavy work load. However, relevant officers were informed to maintain hereinafter a log book with necessary updating and further to examine them properly.
ii) A necessity was arisen to obtain the services of an officer with proper training and knowledge in order to make the accelerated process for awarding of deeds implemented by the Land Reform Commission on the instruction of H.E. the President and on the guidance of the Secretary to H.E. the President.
Accordingly, Mr. E.Y. Kithulegoda, who has wide experience by serving in the Commission from its establishment and served as Coordinating Director, Executive Director of the Commission and further served as a Chairman of a local government institution and further as a Member of the Provincial Council has been appointed as a Consultant of the Deeds division on contract basis from 20.06.2007 subjected to the renewal of his term in every three months. A vehicle has not been assigned to Consultant – Deed. However, arrangements have been made to provide him a vehicle from the pool of the Commission having take into consideration the role played by him and the posts held by him either in and out the Commission.
Further, he was informed by me to inquire into the land investigations outside the office and the public disputes arisen in awarding deeds with a view to make use of his knowledge
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properly. Therefore, he has used the official vehicle for field duties also. Since it has to travel for distant areas to perform such duties, it has to run the vehicle for higher mileage using more fuel. Since the official vehicle provided for official duties is belonging to the pool, the fuel limit applied for the vehicle is as mentioned in Management Services Circular No. PED/50 dated 28.07.2008. i.e. The fuel limit subjected to Rs. 8000/- which is entitled to the Directors. However, in relation to the fuel used by the Deed Consultant beyond the approved limit, relevant divisions were informed to submit the particulars of fuel used reasonably beyond the maximum limit to the Board of Directors as per letter No. Public1/119/1 dated 29.09.2004 issued by the Department of Public Enterprises.
iii) At several occasions the District Director, Kegalle has been instructed to sell the old tea factory building belonging to the Commission and situated in Narangala estate in Divisional Secretary’s Division, Aranayaka in Kegalle district even through calling tenders after obtaining a valuation since the equipments are stolen from year 1997.
Even though, it was ordered to sell that old tea factory under public auction since the value of the building is continuously decreasing, the District Director and the officers have conducted the auction deviating from the provisions of the relevant circular getting the participation of Grama Niladhari of the area. No notice has been published in newspapers regarding the auction. However, District Director has reported that notices have been published in District and Divisional Secretariats through the Government Agents and District Secretaries. However, all District Directors including Director Kegalle has been informed to follow 2:3:1 of Public Finance Circular No. 353 (5) in the removal of assets in future. iv) Officers were made aware of figure scanning system as per
Public Administration Circular No. 09/2009 dated 16.04.2009. This matter has been referred also to the Commission and further action is due to be taken on the decision of the Commission.
v) In addition to the duties entrusted, the Executive Director has been entrusted the duties of Land Alienation Division and Project Division.
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At certain occasions action has been taken on my verbal instructions to engage other officers in field duties entrusted to Executive Director. These are the duties entrusted to Executive Director and therefore entries in daily running chart have been made in the name of Executive Director even though other officers used pool vehicles for such duties under the instructions of Executive Director. Executive Director has also gone for certain field duties. However, all the drivers have been instructed to enter correctly the names of the officers engaged in duties on behalf of the Executive Director in daily running charts.
(III) Circulars issued by the Presidential Secretariat A portion of land in extent 3 a. 0 r. 0 p of Martin Estate Manaweriya in Puttalam district has been provided to Nimco Apparel (Pvt) Ltd from 08.10.1992 on lease. The Circular of the Presidential Secretariat No. SEI/A/4/34 has been issued in year 1995. However, the lease agreement has been entered into with Nimco Apparel (Pvt) Ltd before the issuance of above circular i.e. on 12.08.1994. Since a condition for the increase of lease rent has not been included in the agreement with Nimco Apparel (Pvt) Ltd action has to be taken legally in accordance with the lease agreement. Therefore, it seems action should have to be taken in 2005 in this regard.
d) Inland Revenue Act No. 10 of 2006 (Section 153) Even though, withholding tax has not been recovered for the supply of security services from January 2010, relevant amount has been recovered thereafter. Withholding tax for January, February and March 2010 has been recovered from the bill for October 2010. In the meantime, withholding tax for May and June has been recovered from the bill for November. They have been sent to the Department of Inland Revenue.
e) Nation Building Act No. 9 of 2009 (Section c)
Instructions were given to the Director to take action for recovery in future.
f) Procurement Guidelines of the Government i) Action has been taken to call quotations form three institutions for 2010 which have registered for the supply of uniforms for the Minor Employees. However, it was observed that even under the minimum quotations submitted by the above institutions, it has to bear an expense of Rs. 145,855/- for the purchase of uniform materials and further, Rs. 61,000/- as the tailoring charges (Rs. 1000/ x 60 persons) and accordingly the Commission has to bear the total expense of Rs. 206,855/-. IT has been discussed with the institution which made quotations in order to make a revision in the prices and also to seek the possibility to provide two sets of uniform
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to the employees. However, the institution has informed that it has submitted the minimum price and further only the selling of materials is done by the institution. Since it can further be delayed the provision of uniforms to the Minor Employees in 2010 under such situation, action has been taken to provide two sets of uniforms to each employee under the quotation of Rs. 73470/- from TATA Tailoring which is an institution not registered under the Commission. This has been carried out with the concurrence of both the Trade Unions and the employees. Even though, a representative of the above institution has visited the Head office to take the measurements from the employees for uniforms, it could not complete the task due to the absence of several employees from duty and further some of the staff members of the District Secretariat were unable to present themselves at the Head Office. Further, the employees, from whom measurement could not be taken, refused to accept the ready made uniforms. Under such circumstance Rs. 42660/- had to be paid for the provision of two sets of ready made uniforms for 18 employees from whom the measurement was taken and Rs. 52500/- has to be paid for provision of uniform materials to 43 employees from whom the measurement could not be taken. Accordingly, the total amount paid to TATA Tailoring is Rs. 95160/-. The employees to whom the uniform materials have been given for 2010 were not paid the tailoring charge of Rs. 1000/-. However, the Commission could save an amount of Rs. 56795/- when comparing with the prices in the quotations obtained for the purpose previously. Even though, no loss has incurred to the Commission at this instance, relevant officers were informed to provide uniforms for employees hereinafter following the provisions of the Procurement Guidelines. ii) The cabs bearing No. 53-9673, 251-7255, 251-7256 and 57-2486 belonging to the Land Reform Commission have been referred to the Auto Mobile Engineering Training Institute. The Technical Officer of the institution, having inspected the vehicles, has recommended that necessary repairs should be done immediately since various repairs required to be done for such vehicles. On the recommendation of the Technical Officer, action has been taken on 29.10.2009 to call quotation from ten institutions registered at the Commission for repairs to vehicles. However, only eight institutions have made quotations. The value of every quotation has reached up to Rs. 100,000/-. However, only on the approval of the Tender Board and the Commission, action has been taken to get the necessary repairs done by the institutions that have made minimum quotations. This task has been performed at several previous occasions on the approval of the Commission, but the approval of the Ministry has not been sought for the purpose. However, action will be taken to follow a proper methodology by way of discussing such matters with the Land Reform Commission.
g) Establishments Code Acting appointments should strictly be made as a temporary remedial measure until a permanent appointment is made.
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However, applications have been called by a new paper notice for recruitment to the post of Director/ Finance, Chief Internal Auditor and Director/ Valuation and Compensation and further have also been interviewed. However, the effort made for was fruitless as the candidates have not possessed the qualifications prescribed in the Procedure of Recruitment of the Commission and further they expressed their reluctance to serve under the salary prescribed for the post. Under such circumstances the most suitable officer has been appointed to act in the post of Director of Finance Division, Internal Audit Division and Valuation and Compensation Division. Action has been taken to obtain instructions from the National Cadres Commission and Department of Management Services regarding the recruitment for this main post which has been fallen vacant. However, it has been informed that no new recruitment should be made until the approval is received for the cadre and proposed new Scheme of Recruitment of the Commission. A draft of the Scheme of Recruitment has already been submitted to the National Salaries and Cadres Commission. Further, instructions are due to be obtained from the Department of Management Services for filling of this vacancy in order to carry out functions of the Commission without interruption until the new Scheme of Recruitment is approved.
(3) Financial and Operational Review 3.1 Financial Review
3.1.1 Financial Result a) Even though, it could not reach a net excess similar to the amount of operations
in year 2009, an increase of Rs. 10,221,761/- is shown in year 2010. The reason for this situation is the reduction of the percentage of interest given for the investment in 2010. However, it could be covered by the income on lease (increase of lands provide on lease basis than the land sales and provision of lands for projects on lease) income on timber and lease of metal.
b) The reduction of excess by 50% in 2010 comparatively to year 2009 has affected
mainly for the situation. In addition to the above, the increase of income to be recovered from the provision of lands to the projects in 2010 than 2009 is also a reason for this. Due to these reasons, the net cash flow has been decreased by 50% after the adjustment of working capital.
3.1.2 Transactions of contentious nature a) A report on fuel consumption was obtained from the agents for the jeep bearing No. KH9751. According to the report of the agent , the mileage of the vehicle should be 8.5 km per liter. However, it was observed at the test running made within a limited distance in Colombo with the assistance of Technical Officer that 8.5 km cannot be covered by a fuel liter. Therefore, the fuel adjustment has been revised as 8 km per liter. The agent has given the fuel consumption report, but there were some changes in the practical running. The transport officer who examined the relevant documents has informed this situation. It was observed that the fuel consumption level shown by the agent for the purpose of increasing their sale is not practical.
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Therefore, having provided particulars of fuel consumption of the vehicle, a written request has been made to the Auto Mobile Engineering Institution at Orugodawatta to provide a report making a re-inspection. Accordingly, this vehicle was driven nearly a distance of 80 km on 14.12.2010 and 15.12.2010. Having taken into consideration the road conditions, highway traffic, etc recommendations have been given to adjust the fuel consumption as 7 km per liter. The recommendations made by the Technical Officers who inspected the fuel consumption of the vehicle were taken into consideration. Since the maintenance of daily running charts with such weaknesses and deficiencies is difficult and no way suitable, it was removed from the running chart. Further, action has been taken to balance the running chart without considering the daily fuel consumption according to the Technical report.
b) Due to the limited number of vehicles in the pool, vehicles have not been assigned for each driver. Therefore, a situation has arisen for the Commission to run a vehicle as soon as it returns to the Commission after running form a duty. Therefore, it is impossible to make the relevant entry in the running chart as soon as the traveling is completed. It has been observed that ambiguous entries as well as changes in balancing of fuel due to making entries in running charts at later occasions. However, it has been informed such situation should not be observed herein after and action would have to be taken against the driver and the officers who inspect the running charts if similar incidents are again reported.
c) An amount of Rs. 6000/- has been obtained for making payments to six members of the Commission who were due to be participated in the meeting of the Commission which has to be conducted. However, only Rs. 3000/- has been paid as three members have been participated in the meeting. The remaining balance of Rs. 3000/- has been settled immediately on the following day by the receipt No. LRC/1 175551.
d) The van bearing No. 61-1117 belonging to the Commission has been handed over to the Arjuna Motors Institution following the proper methodology. The repair has been commenced based on the quotations submitted for the major repairs. However, action has been taken to submit two additional estimates after the dismantling of certain parts such as clutch plates, pressure plates, release bearing, etc of which the damages cannot be measured before such dismantling. Since, the value of those two additional estimates were Rs. 90500/- and Rs. 28400/-, the approval of the Executive Director has been applied. It is hereby noted that additional estimates have been submitted due to the repairs for the engine parts which were identified after dismantling. Further, it is noted that the vehicle should complete be dismantled in order to make such repairs. The repairs inside the system can be identified only to a limited extent if such inspection is made without dismantling relevant parts. Once the payments have
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been made for the additional estimated tasks, no short term repairs have been done either from Arjuna Motors or any other institution.
e) The ceremony for awarding Ranbima deeds has been held on Saturday 18th December. In response to the Fax message received from the Presidential Secretariat, several officers including Director/ Management and Human Resources participated in the activities relating to reservation of stalls at Deyata Kirula exhibition 2011 and organising activities prior to the exhibition. 19the December was a Sunday and 20th was a Poya Holiday. Accordingly, the officers set off on 21st for the duties entrusted to them and therefore no sufficient time was available for the provision of an advance to these officers for their meals and accommodation. Since the officers engaged in the awarding of Ranbima deeds have been engaged also for these tasks, the balance of the money obtained for the above ceremony has been utilised for this purpose.
f) Only the approval of the Commission was made applicable for granting leave to Mr. Hariguptha Rohanadeera (Attorney at law) Executive Director from 20.02.2010 to 19.04.2010 to contest as a candidate of the election and this matter was not referred to the appointing authority. Relevant appointment is made by the Commission with the concurrence of the Secretary of the relevant Ministry. At the inquiry made in this regard, it was revealed that the Executive Director has not used the vehicle on 20, 23,24,25.02.2010. Investigation is further carried out and the progress will be reported in due course. Attendance and leave of the post of Executive Director are not recorded. Normally most of the duties have to be performed out of the office during the office days also. If the Executive Director performed the duties during the period of leave obtained to contest the election, he has to sign cheques and make minutes in the files. Since he has not performed any of such duties, it is proved that he has obtained leave without performing his duties. It is hereby certified that no allowance or any payment has been made to the Executive Director during this period.
g) It has been proved by the letter No. 21 in the file for vehicles No. 2/7/10/3 that the official vehicle of No. KH – 9751 assigned to him by the Commission has not been used by the Executive Director during the period of leave for contesting election i.e. from 25.02.2010. It is hereby informed that the vehicle bearing No. KH – 9751 has been used for the duties in Trincomalee and Kurunegala districts during the period where the Executive Director was on leave and further particulars of relevant duties have been entered in daily running charts.
h) It has been observed at the inspection of daily running charts of the official vehicle provided to Executive Director more fuel consumption is shown due to the traveling to the distant areas for field duties.
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It is difficult to carry out functions of the Land Reform Commission without field duties. Either Executive Director or any other Director should be participated in such specific field duties. Therefore, with a view to get these tasks performed more effectively, action has been taken to make the Executive Director participate in such duties. In the performance of these duties, it has to use fuel beyond the limit prescribed in the circular to the official vehicle assigned to Executive Director. Once the clarifications made to the Commission for the fuel consumption in 2010beyond the limits, the Commission has granted approval accepting the clarifications.
i) 2.2.8 c Circulars – Answer given under Treasury Circular (II)
3.2 Operational Review 3.2.1 Performance a) All the Directors in charge of the divisions were informed that they are required to submit the progress of their divisions in accordance of the action plan 2011.
b) The performance of certain activities has been avoided due to granting priority to other duties on various situations and requirements.
c) Nine activities which have not been performed at satisfactory level in 2010 are
fallen under Human Resources. They cannot be competed due to the vacancies existing in the higher managerial posts including Director General.
Officers were informed that they should see to per form the duties of their divisions targeting the action plan in 2011 whilst drawing thorough attention to all the activities.
3.2.2 Management Inefficiencies
a) Action has not been taken for more than 10 years to take a final decision on the auction of tea factory at Narangala Estate Kegalle due to the changes occurred at several occasions in the governing body and political interference.
Action has been taken to sell the building at an auction held in December 2009 with the participation of a Board of Officers after obtaining a valuation of tea factory Narangala from the Director, Valuation of the Commission, before such problematic situation arises again. Therefore, it has been concluded an activity in 2009 which has been delayed for more than 10 years.
b) It is observed that the advances obtained not only from employees, but also from other parties are included in the amount of Rs. 3,584,600/- which you have mentioned as obtained from employees. However, during the period where Commission was under the scope of the Ministry of Plantation, the scheme for providing a portion of land to the occupation of the officers serving in the Commission has been commenced on the approval of the Commission as well as the Director in charge of the subject. As an initiative, an advance of Rs. 10,000/- has been paid for the portion of land by each officer to the Commission. However, it has become impossible to conclude this task due to the
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inability to identify suitable lands from the field and further due to legal issues regarding the lands which have been identified.
However, lands have been provided to 77 officers. At present several lands have been identified for the provision of portions of land to another group of officers. Accordingly, necessary action is being taken in this regard.
c) Normally, the monthly expenditure of the Commission exceeds Rs. 12 Million. Therefore, action is taken to retain an amount which is equivalent or small amount more than the amount. At the end of every month, the money retained in the accounts of the District Offices is transferred to the accounts of the Head Office. However, only in March, April, November and December money exceeding the above amount has been retained in the accounts. The reason for such situation is that there was a necessity to retain money for salaries and wages, festival advance for these months. In addition to the above, the additional money which is available is invested in the short term fixed deposits. However, an amount over Rs. 20 Million has never been maintained continuously in current accounts for more than three months.
d) 2.2.8 (ii) has been clarified under (ii) of Public Administration Circular.
e) Arrangements have been made at the record room so as to facilitate to some extent to identify documents without much difficulty. Most of the files in land alienation Division have been updated. When the arrangements of the record room is observed, it is clear that action has been taken to categorize files as files which are closed and still being maintained. Further, files have been arranged in accordance with the districts and provinces.
Once the instructions and training are provided from the Department of National Archives to the officers in record room regarding the files of other divisions which are at the record room, prompt action is to be taken to commence more appropriate programme to update and preserve the files. The officer who served as the Record Keeper has been interdicted as he has made an attempt to take a land file out of the office premises without approval. It is hereby noted that a female staff officer is now engaged in the duties of the record room.
f) The answer under 2.2.7 (h) is the answer for this as well. g) The vehicle bearing No. 53-9673 has been handed over to New Chandra Motors
on 16.12.2009 for repairs following the prescribed procedure. The vehicle has been handed over to the office after repairs on 10.02.2010.
According to the running chart of this vehicle, the entry has been made for the last time on 04.12.2009. However, it has not been driven up to 16.12.2009 on which the vehicle sent for repairs. The meter reading of the vehicle as per running chart on 04.12.2009 is 522009. However, the meter reading on 11.02.2010 on which the vehicle has been used for the first time after repairs is 522283. Accordingly, a difference of 274 km is observed between the above two meter readings.
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At the time where the vehicle was handed over for repairs only a limited amount of fuel was in the fuel tank and practically it is impossible to drive this vehicle to a distance like 274 km using such limited fuel. However, an inquiry was made from the institution which repaired the vehicle so as to clarify whether any malpractice has occurred during this period. Based on the clarifications made by the above institution, all the officers engaged in this task have been inquired. Accordingly, action is to be taken after making further inquiries.
h) The Commission has not been registered under Value Added Tax Act No. 14 of
2002. The main objective of the Commission is not earning profit. Mostly, the lands are provided by the Commission to the poor and vulnerable people. Therefore, it is clear that if these taxes are recovered it has to be recovered indirectly from the general public. Therefore, it is a difficult task.
3.2.3 Identified losses
The software package purchased in 2007 on payment of Rs. 1,700,000/- has shown in the accounts as at 31.12.2010 as an advance. Since an investigation is at present being conducted by the Commission to Investigate Allegations of Bribery or Corruption regarding this purchase of computers, this transaction is shown as an advance until a decision is given by the Commission.
3.2.4 Operational Inefficiency (a) Instructions have been given to the relevant officers to make necessary entries after separating the lands such as lands of which particulars cannot be found, lands which have not been taken over, lands of which the particulars are not available in accordance with the Divisional Secretary’s Divisions and obtaining required information by way of conducting field investigations in terms of the particulars of the lands such as and the lands declared by the declarents according to the files of land ceiling division. The clarification made under 2.2.5 is applicable in this regard. (b) Provision of the land called “Waljapalawatta” in Minuwangoda for an
industrial city in year 1998. i. The lot No. 19 of the plan No. 2795 of the Surveyor General, which has
been provided to Texlani Pvt (Ltd) is relevant for this matter.
The total extent of this land is 1 a, 1 r, 38. The deficit extent from the above is 1 r, 33 p. An agreement is due to be made by way of recovering lease rent for the above deficit extent from the date on which the possession is handed over. A commission paper is being prepared to submit to the Commission. In order to prepare deed of lease for the land in extent 1 a, 0 r, 0.5 p for which the approval of Commission has been received, this matter has been referred to Deed Division.
ii. Action is taken to obtain the date of the recovery of possession in writing and to provide portions of land on lease for a period of thirty years from that date according to the procedure.
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iii. The lot No. 8 of plan No. 2795 of Surveyor General has previously been
granted to the institution called “Ready ware” in year 1998. According to the procedure adopted at that time, the valuation was determined by the Ministry of Industries. Since the functioning of the said institution was not satisfactory, the said land has been provided to the institution called “Venicles Lanka” in 2002 by the Ministry of Industries. The Chairman who held the office at that time has instructed to obtain the valuation for year 2002. Accordingly, valuation for year 2002 has been called. The valuation was Rs. 225,000/-.
iv. At the instances where the lessees avoid payment of lease rent annually
for the lands provided by the Commission on lease, a surcharge of 10% is added to the annual lease rent under the normal procedure of the Commission. However it has become impossible to recover such surcharge due to unavailability of a condition in the agreement regarding such surcharge.
v. Action is being taken to revise and recover the lease rents for the relevant
portions of land as mentioned below. Parisan Marketing Pvt (Ltd) No. 2795 lot No. 05 The lessee has been informed on 11.06.2011to to settle the revised lease
rent (Rs. 85,000/- per year). Southern Suntrees (Pvt)Ltd Plan No. 2795 lot No. 13 The lessees have been informed on 04.07.2011 to settle the revised lease
rent. Wilasa DCC (Pvt) Ltd No. 2795 Lot No. 18
It has been referred to the Director, Valuation and Compensation on 03.01.2011 to determine the revision of lease. Accordingly instructions have been given to recover relevant amounts after obtaining valuations.
G.K.Lanka PVT ltd No 2795 lot no 01 P.K.Lanka PVT ltd
Relevant institution has been informed to submit required documents for obtaining approval of the Commission. However such documents have so far not been submitted. Accordingly action has been taken to call the institution to the Head office on a Wednesday. It has also been informed to pay lease rent on 18.03.2011.
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(c) Meerigama Batagolla watta and Renagala Watta. i. 48 acres from the above land has been provided to Meerigama Plantation Company on 23.03.2004. The total lease rent to be paid up to 22.03.2009 has been paid by 09.02.2010. It is not possible legally to recover lease rent for a land which is not used and of which the possession has not been handed over. ii. Revised lease rent which was outstanding as at 23.03.2009 was Rs 336,000.00. Lessee has been informed to settle this amount on 10.03.2010, 24.04.2010, 17.05.2010 and 17.08.2010. Since he has not settled this amount it was decided to call lessee to the office for a discussion after discussing it with the relevant divisions. Even though, the lessee has been informed to come to the head Office by the letters dated 25.11.2011 and 18.03.2011 to discuss in this regard, he has not come to the Head Office. However, in response to a request made by the Chairman, Coconut Cultivation Board by the letter dated 24.07.2011, the lessee has been given time to settle the amount up to 01.09.2011. iii. It is accepted that this transaction has not done correctly and openly. Further, it is noted that every action has been taken to avoid such situation in future. (d) The land called “Jonslandwatta” Three acres from the above land have been provided to Negombo Rifle Society on lease in year 1999. The revised lease rent for the period from year 2008 to 2009 is Rs. 386,100/-. Accordingly, by the letters dated 29.08.2009 and 16.11.2009, the lessee has been informed to pay lease rent for the 5 years from year 2009. Further, he has been informed again on 10.01.2010 to pay the lease rent and the surcharge for year 2009. However, preliminary activities have been commenced in response to a request made to provide the 3 acres on sale Rifle Society. Prompt solution is due to be given in this regard. (e) The land called “Bothalewatta” A valuation has been obtained for year 2010 in respect of the portion of land in extent 5 a, 0 r, 29 p. According to the valuation of the Chief Valuer made in 2010, the lease rent for a year Rs. 38,000/-. The lessee has been informed in writing to recover the lease rent. Action will be taken to provide lease agreement once the lease rent for 5 years is settled. 3.2.5 Corporate Plan (a) Action has been taken as per Section 5.1.2 of Public Enterprises Circular No. PED12 dated 2nd of June 2003 in respect of the most of tasks in the preparation of the Corporate Plan. The officers were informed to pay their attention again to the Corporate Plan prepared and to prepare a revised Corporate Plan making the conditions and stipulations in the Circular applied properly. (b) Relevant divisions were informed to include correct financial information and further to avoid such weaknesses in future. (c) Certain changes can be occurred in the expected income once the Corporate Plan is prepared. The decrease in the percentage of interest given for investment in 2010 comparing with 2009 can be shown as an example. Accordingly, the information given in Corporate Plan can be varied in the year under review. (d) Attention of the relevant divisions were drawn to the non - forecasting of income and expenditure for 2013 – 2015 in Corporate Plan and further they were asked to make it correct. They were also informed to avoid such situation in future. (e) Heads of the Divisions and District Directors were instructed to include correct particulars when determining targets in Corporate Plans and further to take every possible action to achieve the relevant objective. 3.2.6 Budget Control Relevant divisions were informed to pay their thorough attention in this regard.
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3.2.7 Staff Management Even though, action has been taken for a long time to obtain the approval for the organizational structure, cadre and posts of the Land Reform Commission, so far it has become difficult to achieve this target. Therefore, action has been taken to clarify this situation by way of conducting discussions at several occasions with the Department of Management Services, National Salaries and Cadres Commission and the Presidential Secretariat. On the instructions given after the discussions conducted with the National Salaries and Cadres Commission, it has been informed to obtain approval of the Ministry for the cadre. Further, the cadre and the organizational structure have been submitted to the Presidential Secretariat along with all other relevant information. After the study made regarding the information submitted, the recommendation has been given to the salaries and Cadres Commission by the letter of the Secretary to H.E. the President No. RDID/2/2/1/2 dated 30.11.2010 for the list of posts which is relevant for obtaining approval for the cadre of the Land Reform Commission. Further, it is hereby informed that the approval of the Director of the Department of Management Services has been received by the letter No. DMS/E2/01/7/008/2 dated 31.01.2011 for the restructuring of cadre A discussion was conducted with the National Salaries and Cadres Commission regarding the approval for restructuring the cadre. Accordingly, it was informed that the new Procedure of Recruitment of the Land Reform Commission should be restructured. A copy of the Procedure of Recruitment has been submitted to the National Salaries and Cadres Commission on 24.02.2011. National Salaries and Cadres Commission has informed that action would be taken to grant approval for the cadre and the Procedure of Recruitment once the facts provided in respect of Procedure of Recruitment and cadre are studied. 3.2.8 Internal Audit
(a) At several occasions, applications were called by notifications published in the
newspapers for the post of Chief Internal Auditor which was fallen Vacant in the Land Reform Commission. However, a suitable officer could not be recruited as applications were not submitted according to the qualifications prescribed in the Procedure of Recruitment. Further, the candidates who have applied also have not possessed prescribed qualifications.
It is hereby stated that the reason for receiving limited number of applications is the salary scales determined on the qualifications in the Procedure of Recruitment of Land Reform Commission.
This situation was informed to the National Salaries and Cadres Commission as well as the Department of Management Services. However, the recruitment for this post is further delayed as it has been informed not to make recruitments until proper approval is granted to new Procedure of Recruitment and cadre. However, prompt action is to be taken to make clarifications to the Department of Management Services regarding the urgent requirement of the Commission and to obtain instruction and approval for making recruitments to the main posts including Chief Internal Auditor which were fallen vacant, with a view to continue the tasks of the Commission without interruption until the approval for new Procedure of Recruitment is received.
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(b) Most of the tasks have been performed according to the action plan submitted for year 2010. However, only several tasks were delayed as it has to engage in certain specific tasks which demanded prompt action. However, instructions were given that the method of implementing the Internal Audit Plan should be mentioned clearly in the same.
3.2.9 Audit and Management Committees Action is taken to obtain the instructions of the Secretary to H.E. the President in this
regard and further to get the participation of representative in the Audit and Management Committee.
4. System and Control Attention of the Commission was drawn to all the matters for which the report of the
Auditor General requested attention. Accordingly, instructions were given to follow proper procedures and systems by way of rectifying the said weaknesses and problems as far as possible.
Nimal G. Punchihewa, Attorney at Law Chairman Land Reform Commission
