SLIIT: A Journey Against the Odds
SLIIT is Sri Lanka’s leading non-state, degree awarding institute approved by the University Grants Commission (UGC) and Ministry of Higher Education under the Universities Act. The Institute is a member of the Association of Commonwealth Universities (ACU) and the International Association of Universities (IAU) and is the first Sri Lankan institute to be accredited by the Institution of Engineering & Technology, UK.
In recent times, SLIIT has once again been in the news about its status in terms of whether it should be a government enterprise or not. Therefore, we believe that this is an excellent moment to share the true story of the origins, affiliations and ownership status of SLIIT.
But before we go to the beginning of our story, we would like to clarify the following facts, which will become even clearer once you understand the SLIIT story.
- SLIIT is a company limited by guarantee. Therefore, it is not “owned” by any legal or natural entity(s), nor does it pay out dividends to anyone. All financial surpluses are utilized to fund the continuous development of academic programmes, facilities and faculty, along with the provision of scholarships.
- Eminent academics and professionals become Members of the Institute, as Guarantors, until their retirement. This is the same model of “custodianship” that is followed by the highest ranking and most successful universities in the world.
- SLIIT is not, and has never been, owned by the Government or the Mahapola Trust Fund (MTF) at any point in time.
- SLIIT was not part of any Government Ministry at its inception, nor is it presently, though, for a period, it was listed under certain ministries.
- The Institute was founded in 1999 with zero investment from the Government, apart from an industry promotion grant provided by the BOI. The original Guarantors were all acting as individuals and not representing any other organization.
- It was only in 2005, 6 years after the establishment, and successful running of SLIIT, that an executable agreement with the Mahapola Trust Fund (MTF) was finally entered into for the operation of Malabe Campus. Thus, it was only at this point that MTF nominated members to join the Board of SLIIT.
Now, let us go back to 1998…
Sri Lanka’s IT/BPM industry was on the cusp of unprecedented growth and demand. Understanding the enormous potential for Sri Lanka to gain from the coming tech boom, Prof. Lalith Gamage realized that Sri Lanka needed to produce large numbers of IT professionals to meet the demand for these skills. Prof. Gamage was, at the time, a Senior Lecturer and the Director of the Computing Services Centre at the University of Moratuwa (UoM). He wrote a proposal for the establishment of an institute of information technology at UoM and submitted it to the then Minister of Internal and International Commerce and Food, Hon. Kingsley T. Wickramaratne.
Subsequent to this, the matter was escalated to the Cabinet level jointly by the Ministry of Education and Higher Education and the Ministry of Internal and International Commerce and Food, in June 1998. It was proposed that the MTF would fund some capital expenditure and provide an allotment of land in Malabe to house the institute. This was subsequent to discussions with the Chairman of the MTF, a role always filled by the Chief Justice. The Cabinet in principle agreed to this project, however the Ministry of Finance raised concerns citing the lack of qualified academics to teach at this new institute, along with the burden it would place on the Consolidated Fund.
These concerns were addressed through further submissions indicating that existing lecturers from UoM, along with visiting lecturers from industry would initially make up the faculty, while the MTF’s financial contribution would ease the burden on the consolidated fund. However, no response was received for over 6 months.
Keen to forge ahead, regardless, Prof. Gamage requested Mr. Kingsley T. Wickramarathne, then Minister of Internal and International Commerce and Food to convene a meeting with Ministry officials, like-minded professionals, and academics, to find a way to make the much-needed institute a reality, which took place on 28 January 1999. The purpose of this meeting was to find a way forward for this project, and at the meeting it was proposed to form a company limited by guarantee as an interim measure. This would set the wheels in motion and, once cabinet approval was obtained, the Government could, if they wished, takeover the Institute and attach it to UoM.
SLIIT is Born
In March 1999, Sri Lanka Institute of Information Technology (SLIIT) was officially registered as a company limited by guarantee. All of the initial Guarantors acted in their personal capacities and did not represent any organization. Neither the Government nor the MTF had any ownership in the new institute. Thus, SLIIT was born as an independent, non-government entity.
Prof. Sam Karunaratne was appointed Chairman and Prof. Gamage took up duties as Managing Director/CEO (MD/CEO) of SLIIT. There were no other employees of the company at that time, so the Chairman and MD/CEO personally worked together to develop the structure, recruitment schemes and the academic programmes, curricula and course material, for the Institute.
To avoid any further delay waiting for Cabinet approvals, the Chairman and MD/CEO commenced SLIIT operations with an industry promotion grant provided by the BOI together with their time, effort and personal financial contribution. It is crucial to note here that, when operations first started, there was no official Government involvement in the Institute.
Then, in May 1999, the Ministry of Finance rejected the plans for the establishment Institute of Information Technology (IIT) at UoM. IIT at UoM was originally what SLIIT was envisioned to be by Prof. Gamage, and it would have been, if the plan had been approved.
Keeping the Dream Alive
Refusing to give up, the founders of SLIIT decided to keep going and, in September 1999, SLIIT started commercial operations, with its two-year Diploma Programme, at a rented space located at the Bank of Ceylon Merchant Tower in Colpetty. Over 3,150 applications were received, and 400 were accepted, proving that our MD/CEO’s intuition about the need for IT education was accurate. With such broad-based interest, the income from tuition and other fees was sufficient to make SLIIT financially sustainable.
Due to student agitations at UoM, the university management decided to cut all ties with the Institute. This resulted in Prof. Gamage resigning from his position at UoM, at great personal risk, to keep the SLIIT dream alive.
The Finance Ministry had intimated to the Chairman of SLIIT in 2000 that funding could be made available to SLIIT provided the institute was Gazetted under a Government Ministry. Not wishing to leave such an opportunity on the table, the founders agreed to this arrangement. This marks the point at which SLIIT first came “under” a Ministry. However, while the promised funding was never delivered, SLIIT remained listed under various Ministries as a result the progress of the Institute was hindered by political interference from time to time.
Still, the Founders did their best to ensure that the institute remained operational, while looking to expand and improve the quality of the programmes on offer. To this end, the Institute worked to meet the strict standards required and established landmark partnerships, the first of their kind in Sri Lanka, with Curtin University, Australia and with the IBM Corporation, CISCO and Microsoft. SLIIT also sought approval from the UGC to obtain “degree awarding” status. It is important to state that all decisions with regard to the management of SLIIT are duly taken by the governing board of SLIIT following due process and with legal advice where necessary.
Coping With Growing Demand
As demand for SLIIT’s programmes grew, the Institute once again approached the Mahapola Trust Fund (MTF) to revisit the idea of developing the proposed Malabe Campus. However, this time SLIIT approached as an independent entity and not as a part of UoM. Then, in September 2000, the MTF agreed to provide LKR 500 million for construction work, while also allocating the land situated in Malabe. Construction began in 2001.
Meanwhile, 600 new students were enrolled at SLIIT’s Colombo Metro Campus (in Colpetty), and Curtin University agreed to franchise their IT degree programme to SLIIT. UGC also validated SLIIT’s Colombo Metro Campus and granted the Institute “degree awarding” status. It is very important to note that all of this happened well before the Malabe Campus was established, or agreements were entered into, and solely based off of SLIIT’s own merit.
Subsequent to the change of Government in 2001, the MTF suddenly stopped the promised funding, with no further explanation. Up to that point, LKR 373 million worth of funding had been made available, out of the promised LKR 500 million. With the Malabe Campus still not completed and no funding forthcoming, our MD/CEO once again took a great personal risk to keep the SLIIT dream alive. Using his own personal resources and assurances he obtained a loan from DFCC Bank and completed the first phase in 2002.
Ultimately, after much back and forth, an agreement was signed between the MTF and SLIIT in 2003 for SLIIT to lease out the land on which the Malabe Campus is situated, and for SLIIT to continue to operate independently, as a separate legal entity. However, this agreement was never executed as there was yet another change of Government.
A Sustainable Solution
Subsequent to numerous negotiations, in 2005, a new agreement was signed and executed. Under this agreement, MTF would lease the Malabe Campus to SLIIT for a period of 60 years. Furthermore, in recognition of the LKR 373 million (of the pledged LKR 500 million) in funding and for the lease of the land provided by the MTF, SLIIT would provide up to 5 board seats for members nominated by the MTF. Additionally, SLIIT would pay 20% of any financial surpluses generated only from the Malabe Campus to the MTF. This provision would not apply to SLIIT’s other campuses, which it operated with no assistance from the MTF. Thus, even under this agreement, SLIIT remained a separate legal entity. This mechanism continued uninterrupted until 2015, when there was another change of Government.
In 2015, the MTF, now under the control the new Government, wrote to SLIIT indicating that it wished to review the existing agreement, signed in 2005, citing various reasons. In this letter, the MTF requested SLIIT to return all of the funds originally contributed, in full. Later on, they also requested some interest also to be paid. This was after SLIIT had invested in excess of LKR 2 billion into the Malabe Campus from 2005 to 2015.
A new agreement was signed. SLIIT paid LKR 408.5 million to the MTF, which included the initial funding provided, plus interest, which was readily accepted by the Chairman of the Mahapola Trust Fund, a role always filled by the Chief Justice. The MTF renewed the lease of the Malabe Campus land to SLIIT for 60 years at a lease rental of LKR 20 million per annum and increasing every five years, up to a maximum of LKR 45 million. The current lease rental paid by SLIIT is 25 million and all payments over 6 years have been accepted by MTF. Subsequent to having been settled in full, for the money originally provided plus interest, the MTF withdrew its members from the board of SLIIT. Thus, the only nexus we have with the MTF is a lessor/lessee agreement and nothing further.
Contrary to popular speculation, ownership of the Malabe Campus land never changed. The MTF still owns the land on which the SLIIT Malabe Campus is situated and derives a handsome lease rental income from it.
Subsequent to the 2015 settlement, SLIIT continued its excellent higher education programmes and expanded its infrastructure. Then, in 2017 with the intention of promoting the expansion of the institution further by forging closer ties with foreign universities and attracting investment, SLIIT discussed the impediments it had with the government, as a result of being listed under a ministry. In response, His Excellency the President at the time, took necessary action. Thus, in 2017, as the Government neither held any share in SLIIT nor did it provide funds to the Institute, SLIIT was removed from being listed under any Ministry. This was done after obtaining Cabinet approval together with the Attorney General’s and Finance Ministry’s observations.
Thus, today, we have returned to our original state, in which we were forced to begin our journey; an independent, self-sustaining Sri Lankan institute of higher education that is not affiliated with any Government or Governmental Organization. Only now, unlike then, we are a premier centre for excellence in higher education. Thus, we are proud to say that the SLIIT dream continues to be fulfilled, as we create new opportunities for Sri Lanka’s aspiring youth engineering the future envisioned by our founders.