Govt. settles Rs.191bn worth of arrears to various contractors and suppliers

25 February 2023 03:27 am Views - 1370

• Arrears settled despite economy having contracted by 8%
• As of Jan. 31, 2023, govt. has settled 53% of outstanding bills
• Yet to settle Rs.169bn

By Nishel Fernando
The government has settled the majority of the arrears to the tune of Rs.191 billion to contractors and suppliers, after assuming power on August 31, last year, despite an 8 percent contraction in the economy during the year, Finance State Minister Ranjith Siyambalapitiya said.

As of August 31, last year, the government owed Rs.360 billion to various contractors and suppliers. As of January 31, 2023, the government has been able to settle 53 percent of these bills, amounting to Rs.191 billion.

Siyambalapitiya emphasised that it should be viewed as a positive development that the government was able to settle the majority of the arrears, despite the estimated 8 percent economic contraction in 2022.

According to Siyambalapitiya, the government still needs to settle Rs.169 billion in arrears. Rs.100 billion worth of outstanding bills are categorised as recurrent expenditure, while Rs.69 billion is categorised as capital expenditure.
He noted that several of these outstanding bills would be settled on a prioritised basis and it include Rs.18.9 billion worth of outstanding bills for health and medicine, Rs.19.3 billion for pensions and gratuity and Rs.12 billion for fertiliser and chemical supplies.

Upon the recommendation of a committee appointed by the Treasury secretary, the Cabinet of Ministers this week approved a proposal to settle the outstanding payments owed to various parties by issuing Treasury bonds.