Arrack sticker scandal raises fresh questions over Sri Lanka’s state tender process, digital printing costs and procurement failures.
Arrack sticker scandal revelations at Parliament’s Committee on Public Finance have exposed the naked truth about Sri Lanka’s state tender committees and procurement failures.
The recent disclosure over the “security sticker” fixed to liquor bottles by the Excise Department has become a clear mirror of how corrupt, careless and irresponsible the state mechanism and procurement process in Sri Lanka have become.
At the COPF meeting chaired by Dr. Harsha de Silva, a serious practical and financial irregularity was exposed through a revealing exchange.
Committee Chairman Dr. Harsha de Silva asked:
“Now, the problem with this sticker. How is the production? We are questioning how much is being sold illegally.”
Deputy Excise Commissioner M. Jayantha Silva replied:
“The sticker process started in 2022. After January 2, 2027, the current company’s contract will end. Arrangements are being made to call for a new tender. They need to print and supply the stickers. Affixing the sticker is done by the liquor manufacturer. They pay $5.99 per 1,000 stickers. Including port charges and customs duties, it comes to $7.99. One of the two local companies has faster production, and because the other company’s stickers need to be cooled and contain water, the paper sticker cannot be applied. So those two companies have been given a digital sticker. Over 80% are digital. They don’t stick. They are digitally printed.”
Dr. Harsha de Silva then asked:
“When it’s digitally printed, how much do they charge for that?”
Deputy Excise Commissioner M. Jayantha Silva answered:
“That too is $7.99, Sir.”
These answers show that for 80% of the bottles produced by two major local liquor manufacturers, no physical paper sticker is being affixed. Instead, a “digital sticker” is printed directly onto the bottle. Yet, shockingly, the government still pays the same $7.99 to the foreign company for digital printing, although its raw material and production costs are extremely minimal compared to paper stickers.
This raises several serious and urgent questions.
Have Tender And Technical Committees Become Rubber Stamps?
A physical paper sticker requires special paper, security printing inks, hologram technology, adhesive and transportation. Digital printing does not involve these physical costs, meaning the price should be reduced by a large margin. The committee chairman questioned that logic directly.
Dr. Harsha de Silva said:
“Ah… there is no sticker. I am asking, you said the cost of printing on paper is $5.99. This wouldn’t cost $5.99, right? In digital printing, there is no affixing, right? When moving from paper to digital print, the cost should be reduced by about 80%, right? Why are we paying $5.99?”
Despite this clear cost difference, how did tender committees approve the same production cost for digital printing as for paper stickers? Why did the Technical Evaluation Committees, made up of senior officials from relevant ministries, fail to understand such a basic arithmetic and technological difference? This is not mere ignorance. It appears to be deliberate facilitation of the looting of public funds.
Is The Tender Figure Really An Excuse?
To Dr. Harsha de Silva’s question, the Deputy Commissioner gave the following answer:
“That’s the figure given in the tender, Sir.”
That response is both laughable and deeply irresponsible. A basic principle in procurement is that contracts should include clauses allowing prices to be revised proportionately if the production method changes, such as moving from paper stickers to digital printing.
For whose benefit were such weak contracts drafted without flexible clauses that protect public money and prevent the company from gaining an unfair advantage?
Technical Committees Must Be Held Responsible
In large-scale fraud within state institutions, blame is often placed only on politicians. Yet the tender documents are drafted, technically evaluated and recommended for final approval by highly paid senior state officials who present themselves as experts.
Today, these committees within the public service appear to have become rubber stamps that sign with closed eyes, either under pressure from above or because of commission payments.
Those who approved the same payment per 1,000 stickers for both paper and digital versions, including members of tender evaluation committees and technical committees, must be urgently identified. They must be questioned over this financial crime, and Sri Lanka must establish a legal framework to recover lost public funds from those responsible.
The digital sticker on liquor bottles is not just another fraud. It is evidence exposing the serious loopholes in Sri Lanka’s state procurement process and the deep corruption within the bureaucracy. This tender is expected to end in 2027, with a new tender to follow. But if the corrupt committee system remains unchanged, the next tender will simply pour old wine into new bottles while public funds are looted again.
