Mattala Airport’s expenditure is 21 times its income – Auditor General

The Auditor General has reported that the operational expenditure of the Mattala International Airport in 2021 was twenty-one times higher than its income for the same period. 

These comments were made by the Auditor General while reporting on the 2021 financial statements of the Airports and Aviation Services Sri Lanka Private Limited yesterday (Dec. 24).

Furthermore, the Auditor General has highlighted the operational performances of the international airports in Rathmalana, Jaffna and Batticaloa. 

Airport and Aviation Services Sri Lanka Private Limited company recently released its Annual report for the year 2021. 

Commenting on the report the Auditor General made several key observations including the performance of the airports within the country. 

Accordingly, the Company had entered into two agreements with the Japan International Cooperation Agency (JICA) for funding worth 74,397 million Japanese Yen on the 28th of March 2012 and 24th of March 2016.

The funds were to be utilized for Phase II Stage 02 of Bandaranaike International Airport Development Project, however, 82 per cent of the funding value was awarded with a huge delay on the 4th of March 2020. 

Further, a sum of Rs.359.5 million was paid by the Airport and Aviation Services Sri Lanka Limited from April 20, 2013 to April 20, 2022 to the JICA as commitment fees due to under-utilization of funds. 

The Auditor General also noted that no action had been taken to recover the outstanding debtor balance of Sri Lankan Airlines, amounting to Rs. 1.4135 billion. 

As at the end of year under review, the debtor balance of Sri Lankan Airlines was 35 per cent from the total balance of trade debtors of the Airport and Aviation Services Limited.

Furthermore, the Auditor General observed that the operating cost of the Mattala International Airport in the year 2021 was Rs. 2.02 billion and that it was twenty-one times higher than the operating income during the same period. 

The Net Loss after tax of the airport for the year under review was Rs. 4.44 billion and the Cumulative net loss after tax from year 2017 to 2021 stood at Rs. 20.59 billion. 

Although the expected annual passenger capacity of the Mattala Airport was around one million passengers per year, the total number of passengers during the last five years was only 91,747 and total flight movements of last five years were 2,396. 

It was also noted that the total cost of 247.7 million US dollars incurred for the construction of this airport was not effectively used.

The Auditor General further highlighted that the Colombo International Airport, Ratmalana had incurred a cumulative loss of Rs. 1.693 billion from 2017 to 2021, including a loss of Rs. 461.08 million for 2021.

Meanwhile, the Jaffna International Airport, inaugurated in 2019, has incurred continuous losses for last 03 consecutive years, he added.

The Jaffna Airport has earned no revenue in the year 2021 and incurred an expenditure of Rs. 40.74 million.

Reporting on the performance of the Batticaloa International Airport, the Auditor General stated that the Airport earned no revenue for the four years since its inauguration, while Rs. 74.64 million had been incurred as expenditure for last four years.