Much respected Sarath Ganegoda urged to stay on by State. “Bureaucracy can be fixed”
There are moments in public enterprise when rhetoric gives way to reality. When slogans are replaced by spreadsheets. And when, quietly, almost reluctantly, a state institution begins to behave like a business.
Sri Lankan Airlines, under the chairmanship of Sarath Ganegoda – appointed in the wake of President Anura Kumara Dissanayake’s September 2024 victory – appears to have entered such a moment.
For years, the national carrier was not so much an airline as it was a fiscal liability with wings. Losses were routine. Treasury bailouts were expected. And decision-making often appeared to serve interests far removed from commercial logic. Aircraft were flown, yes – but the numbers rarely landed.
Be that as it may, something changed.
The first signal was discipline. Not the kind announced in press conferences, but the kind reflected in yields. Passenger and cargo yields began to improve – not dramatically, but meaningfully. Routes were examined with a sharper eye. Pricing reflected demand rather than habit. The airline, for perhaps the first time in years, began asking a simple question: does this make money?
Then came the harder decisions.
The restructuring of the airline’s USD 300 million bond – long a symbol of accumulated financial strain – was not merely a technical exercise. It was a statement. A willingness to confront legacy obligations and bring them into commercial reality. Haircuts are never easy. But neither is pretending that debt will disappear on its own.
The Ganegoda-led team has had significant success negotiating the debt downwards by securing a haircut. The Ganegoda-led negotiations with an European engine manufacturer, thought to be Rolls Royce, saw a penalty amount of USD40 million being written off. These financial gains highlighted the commercial world’s understanding that Sri Lankan Airlines was in steady and honourable hands.
More quietly, and perhaps more importantly, there appears to have been a shift in culture.
The “googlies” – the unexplained inefficiencies, the quiet favours, the operational absurdities that insiders long whispered about – began to face scrutiny. Economy purchases upgraded by proximity to power and authority to the premium service Business Class came to an ignominious end and requests to the Chairman’s office mysteriously were left not replied to. Yields were up. Procurement practices tightened. Decision pathways shortened. And the casual assumption that the Treasury would always be there to absorb the consequences began to fade.
For decades, that assumption was the airline’s greatest enabler – and its greatest weakness.
Because when losses are socialised, accountability disappears.
What the current board seems to have recognised is that reform is not an announcement. It is a process of removal. Removing excess. Removing indulgence. Removing the comfort of guaranteed rescue.
None of this is to suggest that SriLankan Airlines has suddenly become a model carrier. It has not. The structural challenges remain formidable. Fleet limitations, competitive pressures, and the broader volatility of the aviation industry have not disappeared
As revealed in these pages for several weeks at least four members of the board have felt that no more can be done until politicians make a policy decision on how to go to the next step: these figures are well known to be achievers and feel they cannot move forward without the politicians making some of those hard decisions. refleeting, route optimisation and having a leaner workforce where delivery is very heavy.
The ‘Acheivers’ however appear foxed by the latent bureaucracy and processes. In spite of the fact that Sri Lankan Airlines is constituted under the Companies Act, the painful slowness of government machinery has caused frustration at board level.
Says an insider, “for the first time ever probably, the Chairman has served on a pure non-remunerative basis. I doubt if he’s even had a free ticket to which he would be entitled”.
Detractors do not like this: thus the tabloid media including some on-line sites seem it fit to cast aspersion on the real delivered items and the existing board, all the while making out they are acting in the spirit of national interest – when in fact they are flaming the seeds of distrust and negativity. Especially when much of what is written is anchored anywhere other than in fact.
Be that as it may, there is a difference now.
A difference in tone. In intent. In the willingness to confront uncomfortable truths.
And perhaps most significantly, a difference in expectation.
The Treasury is no longer the first resort. It is, at least in principle, the last.
Be that as it may:
For the first time in a long time, SriLankan Airlines is not asking how much it can be givenbut how much it can earn.
And in a country still learning the cost of excess, that may be the most important shift of all.The biggest cause of any further loss will be squarely on the government doorstep: for not having the courage to act instead of continuing to act with hesitancy as its anchor.
