The Lanka Electricity (Private) Company Limited (LECO) has been criticized for spending over 400 million rupees on renting a building for its head office while leaving a plot of land purchased in 2001 for the same purpose unused for more than 22 years. An audit by the National Audit Office uncovered this significant financial mismanagement.
LECO acquired a 73.7-perch plot of land at No. 508, Elvitigala Mawatha, Narahenpita, in 2001 for 53.5 million rupees, with the intention of building a head office. Despite the purchase, the land has remained undeveloped, forcing the company to rent premises and pay exorbitant rental fees. By the end of 2023, the company had spent 409.2 million rupees on rent.
Efforts to construct the building were initiated in 2014 when the Board of Directors hired the Central Engineering Consultancy Bureau to prepare plans and tender documents. However, this project was shelved and reassigned to the University of Moratuwa in 2015, yet no progress was made. LECO justified the delay, citing the economic recession in the country after 2015 as a primary reason for the stagnation.
The audit report also highlighted irregularities in LECO’s financial management. In 2023, the company paid 36.4 million rupees to its executive officers for unused annual and medical leave from 2022. Of this, 8.2 million rupees was allocated for annual leave and 28.2 million rupees for medical leave. These payments were made without verifying fingerprint attendance records, raising concerns about the authenticity of the claims.
The audit report underscores significant inefficiencies in LECO’s financial and operational management. The expenditure on rent, coupled with delays in constructing its head office, highlights poor decision-making and lack of strategic foresight. Recommendations include accelerating the head office construction to avoid further financial drain and implementing stricter controls on leave payment processes to ensure transparency and accountability.
This revelation has prompted calls for greater scrutiny and reform in state-owned enterprises to prevent similar wastage of public funds. The National Audit Office has urged immediate action to address these inefficiencies and ensure that resources are utilized more effectively to serve public interests.
