Recap on how Presidential Commission witness Ms. Epitawela first blew the lid off ex-SriLankan Airlines CEO’s nepotism in 2015:
Manager, Network Planning and Research at SriLankan Airlines, Priyadarshani Epitawala, who was the advertising manager of SriLankan Airlines in 2011 recently bared details on how her ex-boss fiddled with procurement standards to favour a party with links to the then administration.
Testifying before the Presidential Commission of Inquiry (PCoI) investigating allegations of fraud and corruption in the national carrier on July 19, 2018, Epitawala said, Kapila Chandrasena, the former Chief Executive of SriLankan Airlines, in 2011 had made her ignore procurement standards set by Emirates, which was managing the airline earlier, and award advertising deals to Kuma Stickers without competitive tenders.
Kuma Stickers became a household name during the final years of the Rajapaksa presidency, when the advertiser proudly stamped ‘Kuma Stickers’ on thousands of hoardings featuring the image of Mahinda Rajapaksa. It was also revealed at the Commission that another agency called Vihanga Marketing & Advertising Services Pvt Ltd (both companies were owned by the same family) has also engaged with SriLankan advertising. Both, Kuma Stickers and Vihanga Marketing are companies based in Beliatta, Hambantota, the hometown of the former first family. The official had first made this revelation when she appeared before the Board of Inquiry (BoI) on SriLankan Airlines headed by Attorney-at-Law J.C. Weliamuna appointed by then Minister of Ports, Shipping and Civil Aviation, Arjuna Ranatunga in February 2015.
According to the Weliamuna report published in 2015, Ms. Epitawela informed the BoI that, one day in 2011, the owner of Kuma Stickers had called her and said “we do Namal Babage campaign, we don’t have money and we help His Excellency also. Do your best and give us the best”. He also apparently said, if you do not help us, you will also face the same fate as Manoj. Manoj lost his job because he did not help us, he said.
In the recent hearing, Epitawala has said that Chandrasena’s predecessor, Manoj Gunawardena, who headed the Airline following Emirates’ exit in 2008, had however instructed her not to renew contracts for outdoor advertising hoardings, placed at good locations at lower prices, as part of a cost cutting strategy. The five-member PCoI has been tasked with investigating allegations into allegations of large scale frauds and malpractices in SriLankan Airlines, SriLankan Catering Ltd and Mihin Lanka (Pvt) Ltd over a 12-year period from January 1 2006 to 31st January 31 2018.
The Presidential Commission had recently revealed that the national carrier has paid over Rs. 415 million to two advertising agencies closely linked to former President Mahinda Rajapaksa for displaying hoardings on behalf of the airline. This is despite the fact that the agencies had charged exorbitant rates well above market prices and there was no evidence of competitive bidding for contracts of hoardings .The two agencies owned by the same family – allegedly given special preference during the reigns of Kapila Chandrasena as Chief Executive – were Kuma Stickers (Pvt) Ltd and Vihanga Marketing and Advertising Services (Pvt) Ltd in Beliatte, Hambantota, the hometown of the former first family.
“Only one tender document was available, for the only hoarding contract won by a company based in the Northern Province, where it had quoted a price of Rs. 790,000 rupees for the hoarding in 2014. Kuma Stickers had quoted a price of 990,000 rupees,” Senior Manager Marketing at SriLankan Airlines, Saminda Perera who testified before the Commission said.
When Ms. Epitawala, the former Advertising Manager testified before the Weliamuna Committee in 2015, she had disclosed that although the rates offered by Kuma Stickers for hoardings were excessively high (in the range of Rs. 2,500 to 3,000 while advertisers like Opel offered Rs.1111 per square feet), she was persuaded to offer contracts to the selected agencies due to the undue pressure from the former top management.
She informed the Commission on Thursday (July 19) that former CEO, Chandrasena had instructed her to give all possible hoardings to Kuma Stickers (Pvt) Ltd for advertising irrespective of the fact whether the supplier had the right or not for the site.
Relating the attempts of persuasion to prioritise Kuma Stickers following the appointment of the CEO in May 2011, Ms. Epitawala told the Presidential Commission, “Mr. Chandrasena told me that there’s a person who has a lot of clout on advertising and with municipalities. He gave me a number, of Kuma Stickers. Mr. Chandrasena said the government does a lot of business with Kuma Stickers, and we should support them.”
“I didn’t know whether he meant we should go exclusively with Kuma Stickers. When I asked Mr. Chandrasena if we should go exclusively with Kuma Stickers, he said to get the best deal for the airline.”
She said, by then, most of the hoardings in areas outside Colombo where SriLankan wanted to advertise were controlled by Kuma Stickers, while within Colombo, preference was given to locations held by Kuma Stickers due to Chandrasena’s request.
When Epitawala had begun negotiations with Kuma Stickers, Chandrasena had criticized her for taking too long, she said.
“I said that we needed to go through the proper procurement procedures, and he said, it would take too long. He said to go through the SMT (Senior Management Team) system,” Epitawala said.
“He said, since Kuma Stickers was doing a lot of work for us, we should not look at it like a normal supplier. By then, Kuma Stickers was working with us almost like an advertising agency. So he said we should look at another process.”
Testifying before the Presidential CoI, Epitawela also alleged an act of personal victimization as she attempted to re-acquire hoardings in some of the locations Emirates had advertised in, for two of the best locations in Kandana (1,100 rupees per square foot) and Dematagoda (833 rupees per square foot) owned by two other suppliers. She was transferred out of the advertising department to the Media Relations Division by her then bosses as she did not stick to their orders, she indicated.