Sri Lanka’s civil aviation sector is entering one of its most consequential periods of institutional change, as the Government intensifies investigations into alleged corruption, regulatory failures and revenue losses while simultaneously replacing key leadership positions across the aviation administration.
At the centre of the shake-up is the Civil Aviation Authority of Sri Lanka (CAASL), which is facing heightened scrutiny from Parliament’s Committee on Public Enterprises (COPE), the Commission to Investigate Allegations of Bribery or Corruption (CIABOC) and a special Presidential Investigation Committee examining aviation-related entities.
The scale of the scrutiny became clearer in July, when COPE referred 23 corruption cases involving CAASL and seven other state institutions to CIABOC for immediate criminal investigation. The referrals indicate that concerns surrounding the aviation sector extend beyond isolated administrative shortcomings and raise questions about the effectiveness of internal controls and regulatory oversight.
The authorities are also revisiting older cases. In April, the Right to Information Commission summoned CIABOC and senior airline personnel over delays in an investigation into an allegedly fraudulent jet endorsement connected to CAASL.
Another major concern is the authority’s deteriorating financial position. Six airlines reportedly owe CAASL Rs. 27.6 billion in unpaid embarkation levies, with SriLankan Airlines alone accounting for Rs. 24.6 billion.
The problem is particularly damaging because CAASL has reportedly been constrained by weaknesses in the Aviation Act that prevent it from effectively recovering outstanding payments. The Government has therefore moved towards legislative amendments aimed at closing the enforcement gap.
The issue goes beyond accounting. Every rupee that cannot be collected weakens the regulatory authority’s ability to finance operations, maintain oversight and perform safety-related responsibilities. It also raises a broader question: how could billions in statutory revenue remain outstanding without an effective enforcement mechanism?
At the same time, the Government is attempting to modernise cargo administration. On August 24, a multi-stakeholder committee involving CAASL, Sri Lanka Customs and airport authorities revived plans for an Air Cargo Community System (ACCS). The digital platform is intended to reduce manual paperwork, remove opportunities for middlemen and improve transparency in cargo-related transactions.
The leadership overhaul is equally significant. Col. (Retd.) O.R. Ranjith Rajasinghe assumed duties as CAASL Chairman on August 25, replacing Sunil Jayarathna. At AASL, Admiral (Retd.) Kanchana Banagoda is due to take over as chairman from September 1.
Captain Daminda Rambukwella continues as Director General of Civil Aviation and Chief Executive Officer.
Earlier this year, long-vacant technical positions, including the Deputy Director General of Flight Safety Regulation and Director of Aviation Security, were filled through a formalised recruitment scheme.
The Government is therefore pursuing a two-track strategy: investigate the past while rebuilding the institutions responsible for preventing future failures.
But leadership changes alone will not resolve the sector’s problems. The real test will be whether investigations produce accountability, billions in outstanding revenue are recovered, legal loopholes are closed and the new regulatory structure becomes genuinely more transparent and enforceable.