By Dhammika Ranaweera

A determined stand-off between Minister of Public Enterprises Development Kabir Hashim and the Finance Ministry at yesterday’s Cabinet meeting sent emotions. roaring in connection with a clash of opinions on the amount of compensation to be paid for cancellation of an agreement signed by the previous regime to purchase aircraft.

Hashim objected to the Finance Ministry’s cancellation compensation estimate of US$ 154 million though Cabinet had agreed on a payment of between USS 75-85 million.

Informed sources said the previous UPFA regime had signed an agreement with Aircap Corporation in 2012 to purchase several aircraft.

However, the current government had decided to cancel that agreement on the basis that the intended purchase was not necessary.

As a result of that agreement being cancelled the government was under compulsion to pay compensation to the afore-mentioned firm, with the Cabinet agreeing to it.

The sum of compensation had been ratified by Cabinet after a Cabinet Sub-Committee formed to look into the matter sanctioned it.

However, sources revealed that Minister Hashim had pointed out at the Cabinet meeting yesterday that the decision taken by the Finance Ministry to pay a hefty sum as compensation, having disregarded the amount agreed by the subject Minister and the Cabinet, was unethical and was an arbitrary decision.

The source added that Minister Patali Ranawaka and Dr. Sarath Amunugama had also spoken in support of Minister Kabir Hashim at the Cabinet meeting.

It is also learnt that President Maithripala Sirisena has advised the Finance Ministry to temporarily suspend the payment of compensation to Aircap Corporation.

Courtesy:Ceylon Today