A massive delay at Colombo Port’s Eastern Terminal has triggered a Rs. 4.2 billion compensation battle, exposing deep cracks in Sri Lanka’s project management, oversight, and accountability.
The Committee on Public Enterprises held a lengthy discussion regarding the delay in the construction of the Eastern Container Terminal of the Colombo Port and the circumstances arising due to the delay in the entire project. This discussion brought renewed attention to one of Sri Lanka’s most significant infrastructure struggles, particularly as the contractor has now requested Rs. 4,227 million in compensation for the prolonged delay.
The discussion took place when the Committee on Public Enterprises of Parliament met in Parliament under the chairmanship of its Chairman, Hon. Member of Parliament Dr. Nishantha Samaraweera, to examine the Auditor General’s reports for the years 2022 and 2023 and the current performance of the Sri Lanka Ports Authority. This oversight session was part of a broader effort to ensure transparency and accountability within key national institutions.
The Sri Lanka Ports Authority was convened by the Committee on Public Enterprises on September 10th to examine the Auditor General’s reports for the years 2022 and 2023 and the current performance. The matters that could not be discussed on that day were taken up at the Committee today. These unfinished issues largely concerned the development failures surrounding the Eastern Container Terminal and the escalating financial implications.
The Committee pointed out that the Cabinet had approved a contract worth Rs. 40,273 million with a company in November 2021 to carry out the development work of the Eastern Container Terminal of the Colombo Port. The agreements were signed in December 2021 and the construction work was scheduled to be completed on January 03, 2025. However, due to several factors, the construction was delayed and it was revealed that the work was scheduled to be completed in July 2026 after the extension of the deadline. Due to this, there was a delay of 548 days and the contractor has requested compensation amounting to Rs. 4,227 million. The Chairman of the Committee recommended that a report be submitted to the Committee including all the facts in this regard.
The officials who arrived pointed out that these development activities have been carried out very expeditiously and that these activities will be completed soon. They highlighted that certain external conditions contributed to the setbacks but assured that final completion will not be compromised.
The Committee also drew attention to the food expenses of the employees of the Authority and pointed out that the recommendations made by the COPE Committee in 2023 in this regard have not been implemented. The officials said that steps have been taken to reduce expenses and a competitive tender system has been introduced to minimize prices, ensuring better management of operational costs.
Drawing attention to the acceptance and disposal of all lands belonging to the Ports Authority, the Chairman of the Committee pointed out that legal action should be taken regarding lands recommended to be disposed of and acquired by the court. The officials said that necessary steps have been taken in this regard.
Attention was also drawn to the change of name of the Seeduwa Raddoluwa Sports Club to the Sri Lanka Ports Authority Sports Club and the recruitment of players who joined the club as employees of the Sri Lanka Ports Authority.
