Cabinet this week made a decision to liquidate government affiliated security service Rakna Araksha Lanka Ltd.
The company was established through a Cabinet decision in 2006 to provide security to special institutions such as economic targets, public institutions and private institutions during the war as army officers who were responsible for such tasks were deployed for other security purposes around the country.
“With the present peaceful situation in the country, it has been observed that such a firm is unnecessary”, said Co-cabinet spokesperson Minister Gayantha Karunathilake yesterday.
The work undertaken by Rakna Araksha Lanka is to be reassigned to the Civil Defence Force and the Sri Lanka Navy, he added speaking at the Parliamentary Complex.
According to the Cabinet memorandum on the company, its net assets as of 31 August 2016 stands at Rs 3,264 million.
The company also holds a deposit worth Rs 160 million from Avant Garde Security Services and Rs 2.5 million to be paid to the Sri Lanka Navy for having using the armoury at the Welisara naval camp.
The security service has 1972 security staff on land and 420 security staff at sea and according to the government, many are contract employees and a significant portion ended their contract in September of this year.
The President who had submitted the proposal to liquidate the company, had explained that the government no longer needed a private security firm and that the firm itself had acted beyond their ‘Articles of Association’ by providing security at sea and for private organizations.
Furthermore the company had suffered considerable losses given that the government no longer provided patronage to it and it was no longer sensible to keep it going as a government entity.
The COPE report in August this year had also pointed out that there were legal issues over the third party agreements Rakna Araksha Lanka had signed on to and that the profit share system of the company was not favourable to the government, as over 75 percent of it was being paid to Avant Garde.
The company was also investigated by the Presidential Commission of Inquiry to Investigate and Inquire into Serious Acts of Fraud, Corruption and Abuse of Power, State Resources and Privileges (PRECIFAC) for having used Rakna Lanka employees for election work during the 2015 Presidential elections.
Rakna Lanka would be liquidated in accordance with the Attorney General’s recommendations.