Sri Lanka's Rajapaksa wins 2015 budget vote despite defections

Reuters News
Posted: Nov 24, 2014 9:46 AM

By Shihar Aneez and Ranga Sirilal

COLOMBO (Reuters) - Sri Lankan President Mahinda Rajapaksa, who is facing a split in his ruling coalition ahead of a snap presidential poll on Jan. 8, won the final vote on the 2015 budget Monday with a strong majority.

Rajapaksa is aiming for a budget deficit of 4.6 percent of the gross domestic product (GDP), its lowest since 1977, from this year's revised 5 percent.

However, the opposition said the figure would be much higher after the budget was loosened.

Health Minister Mithripala Sirisena announced on Friday that he would contest the snap poll against Rajapaksa.

Since the election announcement a day earlier, seven Rajapaksa loyalists including Sirisena and Fisheries Minister, Education Services Minister, a deputy minister and three legislators have defected from the ruling party.

Rajapaksa's 2015 budget, filled with populist policies, was passed with 152 in favor of it against 57 in the 225-member parliament. Rajapaksa tweeted that the budget was passed with more than two-third majority.

"(Rajapaksa) needs more popularity to win the election. So there are many policies certainly designed to boost his popularity," Sasha Riser-Kositsky, an analyst at the Eurasia Group told Reuters.

"Rajapaksa still has control of state machinery and his policies will not be aimed at reforms."

Local media had predicted massive defections from Rajapaksa's camp during the budget vote and the possibility of him losing the parliament majority.

The state-controlled Daily News on Monday quoted Rajapaksa as saying that he had details of corruption by the defectors.

"I have their files and documents which will be very detrimental for their well being. I will not use them against those who had left, betraying the party, but I warn them not to throw stone from inside glass houses," Rajapaksa was quoted.

Political analysts said his threat would have stopped some expected defections on Monday. None of the defectors have yet commented on the allegations.

Eran Wickramaratne, an opposition legislator on Monday told the parliament that the Appropriation Bill was amended to increase total expenditure by 356 billion rupees ($2.72 billion), while the borrowing limit was also increased to 1.78 trillion rupees from the original 1.34 trillion rupees.

"We were told during the budget speech that the budget deficit had reduced overtime from 5.9 percent in 2013, 5 percent in 2014 to an estimate of 4.6 percent in the 2015. But after the amendment to increase budget expenditure the deficit will rise to 7.7 percent."

However, Rajapaksa's ruling party said the opposition was tricking the public with the numbers.

(Reporting by Shihar Aneez; Editing by Toby Chopra)