ACT, No. 01 OF 2013

01of2013.pdf
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PARLIAMENT OF THE DEMOCRATIC
SOCIALIST REPUBLIC OF
SRI LANKA
DIVINEGUMA ACT, No. 1 OF 2013
[Certified on 11th January, 2013]
Printed on the Order of Government
Published as a Supplement to Part II of the Gazette of the Democratic
Socialist Republic of Sri Lanka of January 11, 2013
PRINTEDATTHE DEPARTMENTOFGOVERNMENTPRINTING,SRILANKA
TO BEPURCHASED AT THE GOVERNMENT PUBLICATIONS BUREAU, COLOMBO 5
Price : Rs. 25.00 Postage : Rs. 25.00

Divineguma Act, No. 1 of 2013 1
[Certified on 11th January, 2013]
L.D.—O. 13/2012.
ANACT TO PROVIDE FOR THE ESTABLISHMENT OF ADEPARTMENT TO BE
CALLED AND KNOWN AS THE DEPARTMENT OF DIVINEGUMA
DEVELOPMENT BY AMALGAMATING THE SAMURDHI AUTHORITY OF
SRI LANKA ESTABLISHED BY ACT, NO. 30 OF 1995, SOUTHERN
DEVELOPMENT AUTHORITY OF SRI LANKA ESTABLISHED BY ACT,
NO. 18 OF 1996, THE UDARATA DEVELOPMENT AUTHORITY OF SRI
LANKA ESTABLISHED BY ACT, NO. 26 OF 2005; TO ESTABLISH
DIVINEGUMA COMMUNITY BASED ORGANIZATIONSAT RURAL LEVEL
AND TO PROVIDE FOR A CO-ORDINATING NETWORK AT THE DISTRICT
LEVELANDNATIONAL LEVEL; TOESTABLISH DIVINEGUMA COMMUNITY
BASED BANKS AND DIVINEGUMA COMMUNITY BASED BANKING
SOCIETIES; TO REPEAL SAMURDHI AUTHORITY OF SRI LANKA ACT,
NO. 30 OF 1995, SOUTHERN DEVELOPMENT AUTHORITY OF SRI
LANKA ACT, NO.18 OF 1996 AND UDARATA DEVELOPMENT
AUTHORITY OF SRI LANKA ACT, NO. 26 OF 2005 AND TO PROVIDE
FOR MATTERS CONNECTED THEREWITH OR INCIDENTAL THERETO.
WHEREAS, in furtherance of the economic development Preamble.
process and in giving effect to the national policy of
alleviating poverty and ensuring social equity, it has become
necessary to improve the individual, family, group and
community centered livelihood development activities:
AND WHEREAS, Divineguma intends to mobilize people
into a national development process at community
level establishing divineguma community based
organizations thus building up regional, district and
national level co-ordinating network and developing and
promoting a micro- finance banking system:
NOW THEREFORE be it enacted by the Parliament of the
Democratic Socialist Republic of Sri Lanka as follows:-
1. This Act may be cited as the Divineguma Act, Short title and
No 1 of 2013, and the provisions of this Act other than date of operation.
this section, shall come into operation on such date as the
Minister may appoint by Order published in the Gazette
2—PL005889—4,190 (08/2012)
2 Divineguma Act, No. 1 of 2013
(hereinafter referred to as the "appointed date"). The
provisions of this section shall come into operation on the
date on which this Act becomes an Act of Parliament.
PART I
ESTABLISHMENT OF DIVINEGUMA
DEVELOPMENTDEPARTMENT
Establishment 2. There shall be established for the purpose of this Act,
of Divineguma
a government department called the Divineguma
Development
Department. Development Department (in this Act referred to as the
"Department").
Director- 3. (1) There shall be appointed a Director-General of the
General and Department (in this Act referred to as the "Director-General")
other officers
and servants of and such other officers and servants as may be required from
the Department. time to time to carry out the powers and functions of the
Department.
(2) The Director-General may delegate in writing to any
public officer any of his powers, functions and duties as may
from time to time be considered necessary.
Objects of the 4. The objects of the Department shall be:-
Department.
(a) to carry out such development activities as may be
required to alleviate poverty and to bring about a
society guaranteeing social equity;
(b) to promote the individual, family, group and
community centered livelihood economic
development activities;
(c) to ensure food security for each individual and
family;
(d) to mobilize and empower people to speed up the
national development;
Divineguma Act, No. 1 of 2013 3
(e) to provide micro-financial facilities for the purpose
of promoting the livelihood development of
people;
(f) to develop physical and social infrastructure
facilities as may be required for the development of
the livelihood of people;
(g) to carry out such studies and research as may be
required relating to the economic and social
upliftment of people;
(h) to develop the human capital in order to uplift living
standards of people; and
(i) to create a social security network for those who are
in need of social security.
5. The Department shall, in the discharge of its functions Powers of the
have the power:- Department.
(a) to supervise and monitor the establishment, control
and management of divineguma community based
organizations, divineguma regional organizations
and divineguma district committees;
(b) to create a network of organizations linking
divineguma beneficiaries at zonal, district, regional,
village, Grama Niladari division and community
level and attend to matters connected therewith or
incidental thereto;
(c) to establish centres for storage, marketing and
processing of the products of divineguma
beneficiaries and to make available physical and
financial resources for the said purpose;
(d) to maintain the Divineguma Development Fund
and the Divineguma Revolving Fund established
under sections 36 and 37 of this Act;
4 Divineguma Act, No. 1 of 2013
(e) to utilize the moneys of the Divineguma
Development Fund and the Divineguma Revolving
Fund for the purpose of this Act;
(f) to supervise, manage, monitor and audit
divineguma community based organizations,
divineguma regional organisations, divineguma
district committees, divineguma community based
banks and divineguma community based banking
societies;
(g) to arrange for the conduct of lotteries with the
assistance of the National Lotteries Board to raise
funds for the Divineguma Development Fund;
(h) to collect information as may be required, to plan,
supervise, monitor and implement the divineguma
development programmes;
(i) to secure the co-operation of government
departments, state institutions, local authorities,
public corporations, provincial authorities and
other private or public bodies, natural or legal
persons;
(j) to assist in implementing divineguma
development programmes, by divineguma
community based organizations and divineguma
regional organizations;
(k) to implement and operate programmes which will
economically and socially uplift living standards
of people and to develop infrastructure facilities;
(l) to utilize the resources of the Department for the
purposes of training and awareness programmes
that may be conducted by the Department;
(m) to take such measures as may be necessary to
purchase raw-materials, equipment, technology and
Divineguma Act, No. 1 of 2013 5
products of divineguma beneficiaries for the
purpose of promoting the activities of divineguma
beneficiaries and to store them and make them
available to producers as and when the need arises;
(n) to provide marketing facilities including the
setting up of marketing centers enabling
divineguma beneficiaries to introduce and sell their
products at national and international markets and
to maintain, monitor and supervise such centers;
(o) to liaise with governmental and non-governmental
organizations;
(p) to assign the responsibility of implementing
divineguma development projects to divineguma
community based organizations and divineguma
regional organizations;
(q) to possess and hold, any property movable or
immovable, which may become vested in it by
virtue of any purchase, grant, gift, testamentary
disposition or otherwise; and
(r) to attend to all matters connected with or incidental
to such objects and functions as are specified in
this Act.
6. The functions of the Department shall be :– Functions of the
Department.
(a) to formulate and facilitate such projects that would
improve the income generation of individuals,
families, groups and communities;
(b) to assist in increasing the employment
opportunities of devineguma beneficiaries;
(c) to promote marketing activities;
6 Divineguma Act, No. 1 of 2013
(d) to develop necessary awareness of the community
on livelihood development;
(e) to motivate people towards environmental friendly
lifestyle;
(f) to liaise with such institutions that provide
resources and services required for the promotion
of individual, family, group and community
centered development projects;
(g) to promote saving habits amongst people;
(h) to remove obstructions faced by divineguma
beneficiaries in gaining access to resources and
services;
(i) to launch programmes that would lead to creation
of a righteous social environment conducive to
the well being of the community;
(j) to mobilise the participation of divineguma
benificiaries in the planning and management of
projects and schemes for their economic upliftment;
(k) to facilitate the providing of services to divineguma
beneficiries by any government department,
corporation, local government institution, private
sector organization and non-governmental
organizations; and
(l) to assist in creating an institutional framework for
the development of saving habits of divineguma
beneficiaries and granting of loans to them.
Divineguma 7. (1) There shall be established a Divineguma National
National Council to assist, under the superintendence of the Secretary
Council. to the Ministry of the Minister, the Department in respect of
matters relating to the policy and management of
divineguma development programmes.
(2) The Divineguma National Council shall function
subject to such directions of the Minister, as may be issued
in accordance with government policies provided for and
determined by the Cabinet of Ministers.
Divineguma Act, No. 1 of 2013 7
(3) The Divineguma National Council shall consist of
the following members:-
(a) the Director-General who shall be the Chairman;
(b) Director of the Department who is in charge of the
subject of Micro-Finance;
(c) Director of the Department who is in charge of the
subject of divineguma community based
organizations;
(d) Director of the Department who is in charge of the
subject of Livelihood;
(e) Secretary to the Ministry of the Minister to whom
the subject of Finance is assigned, or his
representative;
(f) Secretary to the Ministry of the Minister or his
representative; and
(g) five persons nominated by the Minister.
8. (1) The Minister may, by Order published in the Minister to
Gazette establish, for the purpose of ensuring the effective establish
and proper implementation of the provisions of this Act, administrative
zones.
administrative zones integrating administrative activities
of two or more districts, covering the entire island.
(2) There shall be appointed by the Cabinet of
Ministers, to each such zone a Head, of a similar standing
to that of a Head of a government department, to be in charge
of each such zone.
PART II
DIVINEGUMA COMMUNITY BASED ORGANIZATIONS
9. There shall be established, for each Grama Niladari Establishment of
division or for a portion of a Grama Niladari division or for divineguma
community
several Grama Niladari divisions as may be specified by the
based
Minister by Order published in the Gazette, divineguma organizations.
community based organizations with the voluntary
participation of divineguma beneficiaries.
8 Divineguma Act, No. 1 of 2013
Objects of the 10. The objects of the divineguma community based
divineguma
organizations shall be:–
community
based
(a) to improve the social and economic conditions of
organizations.
divineguma members resident within its area of
authority;
(b) to identify livelihood development opportunities
and its potential;
(c) to provide assistance and aid that are required for
the livelihood development activities, under the
guidance of the Department;
(d) to develop the physical and human resources that
are required for the improvement of the livelihood
activities;
(e) to provide such opportunities as may be required
to improve the saving habits of divineguma
beneficiaries;
(f) to expand the opportunities that are available in
obtaining micro financial facilities and to improve
the investment capabilities;
(g) to uplift the level of education and skills of
divineguma beneficiaries and their families;
(h) to provide raw materials, consultancy services and
technological facilities as may be required for the
promotion of production and productivity;
(i) to provide facilities for storage and processing of
any products of divineguma beneficiaries and for
the promotion of marketing of such products; and
(j) to develop self-confidence, collective responsibility
towards society, good qualities and values of
divineguma beneficiaries.
Divineguma Act, No. 1 of 2013 9
11. The powers of the divineguma community based Powers of the
organizations, subject to the direction and supervision of divineguma
community
the Department, shall be:–
based
organizations.
(a) to organize divineguma beneficiaries into small
groups;
(b) to give recognition to such small groups within
the community based organizations;
(c) to implement a social security programme for
divineguma beneficiaries;
(d) to provide necessary facilities for divineguma
beneficiaries in order to secure loans from
divineguma community based banks, established
under section 25 of this Act;
(e) to supervise and regulate loans obtained by
divineguma beneficiaries for livelihood activities;
(f) to provide resources and facilities for such
progarmmes as may be implemented to develop
the skills and knowledge of its members;
(g) to collect and manage membership fees and savings
of divineguma beneficiaries;
(h) to undertake and implement programmes which are
being initiated by the Department and other
recognized institutions for the well being of
divineguma beneficiaries;
(i) to receive such assistance such as grants and loans,
as may be provided by the government, non-
governmental and private institutions;
(j) to undertake and execute such contracts which may
be given to divineguma community based
organizations by the government and other
recognized institutions in order to raise funds;
10 Divineguma Act, No. 1 of 2013
(k) to undertake and implement development
programmes launched with the labour contribution
of the community;
(l) to provide facilities, services and technological
services in relation to the purchase of, reprocessing,
and value addition to, products;
(m) to maintain sales outlets and storages and to
organize markets and fairs for the promotion of
marketing;
(n) to utilize human and physical resources of the
divineguma community based organizations for
social security programmes;
(o) to maintain an office of divineguma community
based organizations; and
(p) to possess and hold, any property movable or
immovable which may become vested in it by
virtue of any purchase, grant, gift, testamentary
disposition or otherwise.
Functions of the 12. The functions of divineguma community based
divineguma organizations shall be:—
community
based (a) to encourage and provide guidance to its members
organizations. to organize themselves into small groups which
operate with mutual co-operation;
(b) to motivate its members to enhance their saving
habits and develop livelihood activities and to
provide assistance for such activities;
(c) to implement such programmes as may be required
for the development of vocational skills and
knowledge of its members;
(d) to organize shramadana activities with the
participation of its members; and
(e) to provide facilities for the production and
marketing activities.
Divineguma Act, No. 1 of 2013 11
13. The funds of divineguma community based Maintenance of
organizations shall be deposited and maintained in a funds of
divineguma
divineguma community based bank in accordance with such community
regulations as may be prescribed by the Minister. based
organizations.
14. Where a divineguma community based Appointment of
organization is not functional in the accomplishment of its an officer to
perform the
objects, the Director- General shall, in consultation with the
functions of
devineguma regional organization to which such defunct divineguma
divineguma community based organization belongs, cause community
such defunct divineguma community based organization to based
be merged with the nearest functional divineguma organizations.
community based organization or appoint an officer of the
Department to perform the functions of such organization
without interruption.
PART III
DIVINEGUMA REGIONAL ORGANIZATIONS
15. (1) There shall be established such number of Establishment of
divineguma regional organizations as may be necessary, divineguma
regional
comprising of not less than five divienguma community
organizations.
based organizations for the purpose of supervising,
monitoring and evaluating the functions of such
organisations at regional level.
(2) Every divineguma regional organization shall
consist of the following members:-
(a) chairman of each divineguma community based
organization;
(b) officer of the Department in charge of a region;
(c) Senior Manager of the divineguma community
based banking societies established under section
29 of this Act; and
(d) three persons involved in the development activities
of the area to be nominated by the Director-General.
12 Divineguma Act, No. 1 of 2013
(3) The Chairman and Secretary of each such divineguma
regional organization shall be elected from among the
members referred to in subsection (2).
(4) The Divisional Secretary of the Division, within whose
area of authority each such divineguma regional
organization is established, shall function as an Advisor to
each such divineguma regional organization.
Objects of the 16. The objects of every divineguma regional
divineguma organization, under the guidance and supervision of the
regional
Department, shall be:—
organizations.
(a) to provide necessary assistance to any divineguma
community based organization to carry out their
livelihood development activities;
(b) to develop such human resources as may be
necessary for the development of activities relating
to the upliftment of livelihood of its members;
(c) to assist the Department in promoting and
monitoring micro- financial activities within its area
of authority;
(d) to purchase products, reprocess and add value to
the same and provide facilities for storage,
processing and marketing of such products at
regional level; and
(e) develop human personality, collective work,
virtuous and spiritual qualities of the divineguma
beneficiaries.
Powers of 17. Each divineguma regional organization shall,
divineguma under the guidance and supervision of the Department, have
regional
organizations. the power:—
(a) to carry out such studies as may be necessary and
collect information, in respect of economic and
Divineguma Act, No. 1 of 2013 13
social development activities within its area of
authority;
(b) to review any livelihood development activities
carried out by any divineguma community based
organizations;
(c) to provide such assistance as may be necessary in
promoting the micro-financial activities within its
area of authority;
(d) to provide such assistance as may be necessary to
any divineguma community based organizations
in organizing and implementing programmes
required for the development of vocational skills
and know-how;
(e) to provide such technical assistance and other
services as may be necessary for the development
of agricultural or any other products of its
beneficiaries in the region;
(f) to maintain centres for the purchase, storage and
marketing of products and raw-material and
organize trading centres and shopping centres;
(g) to monitor and regulate all activities of divineguma
community based organizations;
(h)to establish and maintain a fund of such
organizations subject to such regulations as may
be prescribed by the Minister ;
(i) to undertake and implement such projects launched
by the Department and any other recognized
institution;
(j) to accept aid, grants and loans offered by
governmental and non-governmental organizations
subject to such regulations as may be prescribed
by the Minster;
14 Divineguma Act, No. 1 of 2013
(k) to undertake and perform any contract offered by
the Department or other recognized institution
subject to such directions as may be issued by the
Department;
(l) to establish and maintain an office of the
diveneguma regional organizations;
(m) to deposit moneys of the divineguma regional
organization in a divineguma community based
banking society and maintain accounts of such
deposits;
(n)to utilize human and physical resources of the
organization for the social security programmes;
and
(o) to possess and hold, any property movable or
immovable which may become vested in it by
virtue of any purchase, grant, gift, testamentary
disposition or otherwise.
Functions of the 18. The functions of the divineguma regional
divineguma organization, under the guidance and supervision of the
regional
Department, shall be:—
organizations.
(a) to provide guidance and encouragement in respect
of small group programmes being conducted by
the divineguma community based organizations;
(b) to supervise and monitor the savings of the
divineguma community based organizations;
(c) to provide such assistance as may be necessary to
such divineguma community based organizations
which are situated within its area of authority, for
the advancement of livelihood development
activities carried out by such organizations and
supervise and monitor the same;
Divineguma Act, No. 1 of 2013 15
(d) to organize and implement regional level
programmes needed for the development of
vocational skills and know-how of its members;
(e) to provide raw-material, technology and other
related services for the development of products at
regional level and provide facilities for marketing
of the same;
(f) to provide assistance for the social security
programme being implemented by the diveneguma
community based organizations;
(g) to assist in the preparation of the progress report of
the Department in respect of the respective region;
and
(h) to liaise with other governmental, non-
governmental and private organizations at regional
level for the purpose of achieving the objects of
divineguma regional organizations .
PART IV
DIVINEGUMA DISTRICT COMMITTEES
19. (1) There shall be established for the purpose of this Establishment of
Act, divineguma district committees representing all divineguma
district
divineguma regional organizations functional within a committees.
district.
(2) Each such district committee shall consist of the
following members:—
(a) all chairmen and secretaries of all divineguma
regional organizations within each such district;
(b) Senior Managers of all divineguma banking
societies established under section 29 of this Act
within each such district;
16 Divineguma Act, No. 1 of 2013
(c) the officer of the Department, who is in charge of a
respective district; and
(d) three persons involved in the development
activities of the district to be nominated by the
Director-General.
(3) The District Secretary, within whose area of
authority each such divineguma district committee is
established, shall function as an Advisor to each such
divineguma district committee.
Objects of 20. The objects of a divineguma district committee,
divineguma under the guidance and supervision of the Depatment,
district
committees. shall be:—
(a) to take such measures as may be necessary to
achieve such objects as are specified in this Act
through divineguma regional organizations and
divineguma community based organizations;
(b) to supervise, monitor and evaluate programmes of
divineguma community based organizations and
divineguma regional organizations in the respective
district;
(c) to secure the co-operation of the other district level
organizations in relation to the divineguma
regional organizations and community based
organizations; and
(d) to co-ordinate the programmes of divineguma
community based organizations and regional
organizations functioning in the respective district.
Powers of the 21. The powers of each divineguma district committee
divineguma shall be:—
district
committees.
(a) to convene and conduct committee meetings once
in every three months;
Divineguma Act, No. 1 of 2013 17
(b) to obtain reports from divineguma regional and
community based organizations in the respective
district;
(c) to assist the Department in the supervision,
monitoring and evaluation of the divineguma
community based organizations; and
(d) to conduct a study on divineguma development
programme for and on behalf of the Department
and forward such development proposals as may
be required to the Department.
22. The functions of each divineguma district committee Functions of
shall be:- divineguma
district
committees.
(a) to conduct studies on divineguma development
programmes and projects in the respective district;
(b) to co-ordinate with such other district level
governmental, non- governmental and private
institutions as may be required in carrying out
divineguma development programme;
(c) to consider proposals and views for the efficient
functioning of the divineguma development
programme in the respective district and forward
the same to the Department; and
(d) to prepare monthly a progress review report in
respect of the respective district and convene
progress review meetings.
PART V
DIVINEGUMA NATIONAL FEDERATION
23. There shall be established a Divineguma National Establishment of
Federation consisting of representatives of all divineguma the Divineguma
National
community based organizations. The Minister shall preside
Federation.
at every meeting of the Divineguma National Federation.
18 Divineguma Act, No. 1 of 2013
Object of the 24. The object of the Divineguma National Federation
Divineguma shall be to consider proposals and views needed for national
National
policy planning, co-ordination of divineguma development
Federation.
programme at national level and provide leadership for the
implementation of divineguma development programme.
PART VI
DIVINEGUMA COMMUNITY BASED BANKS
Establishment of 25. (1) There shall be established divineguma
divineguma community based banks for each such area covering the
community
area of authority of one or more divineguma community
based banks.
based organizations in order to promote micro-financial
services among its beneficiaries.
(2) The Minister shall prescribe the registration procedure
of such banks and any other matter in relation to such
procedure.
(3) Every such bank shall by the name assigned to it be a
body corporate and shall have perpetual succession and a
common seal and may sue and be sued in that name.
(4) It shall be the duty of every such bank to comply with
such regulations as may be made by the Minister.
Objects of the 26. The objects of the divineguma community based
divineguma banks shall be :–
community
based banks.
(a) to promote the habit of savings among divineguma
beneficiaries ;
(b) to develop investment potential;
(c) to enhance income by developing the production
potential; and
(d) to provide credit facilities to divineguma
beneficiaries.
Divineguma Act, No. 1 of 2013 19
27. Every divineguma community based bank shall Powers of
have the power :– divineguma
community
based banks.
(a) to open, maintain and close membership accounts,
accept deposits and issue bank pass books to
divineguma beneficiaries and to members of such
banks;
(b) to provide credit facilities with or without securities,
recover loans, manage and operate the same;
(c) accept funds of divineguma community based
organizations and manage the same;
(d) to maintain accounts of such subsidies and such
moneys as may be provided by the Government ;
(e) to invest funds of the divineguma community based
banks in divineguma banking societies; and
(f) to possess and hold, any property movable or
immovable, which may become vested in it by
virtue of any purchase, grant, gift, testamentary
disposition or otherwise.
28. The functions of the divineguma community based Functions of
banks shall be :– divineguma
community
(a) to motivate divineguma beneficiaries to save; based banks.
(b) to provide loans to divineguma beneficiaries at
individual and group levels;
(c) to educate divineguma beneficiaries on financial
management;
(d) to ensure welfare of the depositors and members of
their families;
(e) to develop a banking culture among its customers;
and
(f) to distribute such subsidies as may be provided by
the government.
20 Divineguma Act, No. 1 of 2013
PART VII
DIVINEGUMA COMMUNITY BASED BANKING SOCIETIES
Establishment of 29. (1) There shall be established for the purposes of
divineguma this Act, divineguma community based banking societies
community
comprising of all divineguma community based banks within
based banking
societies. the area of authority of each divineguma regional
organization, in order to establish a viable micro-financial
banking network at regional level.
(2) The Minister shall prescribe the registration procedure
of such banking society and any other matter in relation to
such procedure.
(3) Every such banking society shall by the name
assigned to it be a body corporate and shall have perpetual
succession and a common seal and may sue and be sued in
that name.
(4) It shall be the duty of every such banking society to
comply with such regulations as may be made by the
Minister.
Objects of 30. The objects of divineguma community based banking
divineguma societies shall be :–
community
based banking (a) to set up a viable regional banking network co-
societies.
ordinating divineguma community based banks;
(b) to provide such financial assistance which is
required for livelihood development; and
(c) to motivate divineguma beneficiaries to engage in
formal micro-financial banking activities.
Powers of 31. The divineguma community based banking
divineguma societies shall have the power:–
community
based banking
societies. (a) to accept deposits of the divineguma community
based banks ;
(b) to invest its funds, grant credit facilities and disburse
profits;
Divineguma Act, No. 1 of 2013 21
(c) to provide such facilities and training as are needed
for the promotion of the divineguma community
based banks;
(d) to maintain accounts of divineguma community
based banks and manage such subsidies as may be
provided by the government;
(e) to supervise and regulate the divineguma
community based banking activities subject to such
directions as may be issued by the Board of
Management; and
(f) to possess and hold, any property movable or
immovable which may become vested in it by
virtue of any purchase, grant, gift, testamentary
disposition or otherwise.
32. The functions of divineguma community based Functions of
banking societies shall be:— divineguma
community
(a) to collect the deposits maintained by divineguma based banking
community based banks and manage the same; societies.
(b) to take such steps as may be necessary to develop a
micro-financial culture among divineguma
beneficiaries; and
(c) to function as a regional institution for the
successful operation of the divineguma community
based banking activities.
33. (1) The Minister shall appoint for the purpose of Board of
the supervision and regulation of the financial activities of Management of
divineguma
the divineguma community based banks and divineguma
community
community based banking societies, a Board of based banks and
Management of the Divineguma Community Based Banks divineguma
and Divineguma Community Based Banking Societies (in community
this Act referred to as the "Board of management"). based banking
societies.
(2) The Board of Management shall consist of :–
(i) the following ex-officio members namely:-
(a) the Director-General of the Department who
shall be the Chairman;
22 Divineguma Act, No. 1 of 2013
(b) a representative of the Secretary to the
Ministry of the Minister to whom the subject
of Finance is assigned;
(c) the Director in charge of the banking affairs
of the Department;
(d) a representative to be appointed by the
Governor of the Central Bank of Sri Lanka;
(e) the Secretary to the Ministry of the Minister
or his representative; and
(ii) three persons to be appointed by the Minister
(hereinafter referred to as the "appointed members").
(3) The term of office of every appointed member shall
be three years.
(4) An appointed member may resign his office by
letter addressed to the Minister and such resignation
shall be effective from the date on which it is accepted
by the Minister.
(5) The Minister may for reasons assigned therefor
remove an appointed member from office.
(6) In the event of a vacancy occurring due to the
death, resignation, incapacity or removal from office of
an appointed member, the Minister shall, having regard to
the provisons of sub section (1), appoint another member in
his place.
(7) A member appointed under subsection (6) shall
hold office for the unexpired part of the term of office of
the member whom he succeeds.
(8) The appointed members may be paid such
remuneration as the Minister, in consultation with the
Minister to whom the subject of Finance is assigned, shall
determine.
(9) The Board of Management shall, for the purpose of
supervision and regulation of financial activities of such banks
and banking societies have the power to issue directions from
time to time, to such banks and banking societies.
Divineguma Act, No. 1 of 2013 23
(10) The Board of Management shall, in the discharge of
its duties, be subject to such regulations as may be prescribed
by the Minister.
34. There shall be established for the purpose of this Divineguma
Act, a Divineguma Community Based Banking Union Community
Based Banking
consisting of all Divineguma community based Banks and Union.
divineguma community based banking socities.
35. The provisions of the Banking Act, No.30 of 1988 Finance Business
and the Finance Business Act, No.42 of 2011 shall not apply Act, No.42 of
2011and
in respect of banks and banking societies established under Banking Act,
the provisions of this Act. No. 30 of 1988
not to apply.
PART VIII
FUNDS OF THE DEPARTMENT
36. (1) There shall be established, for the purpose of this Divineguma
Act, a fund called "Divineguma Development Fund". There Development
Fund.
shall be credited to such Fund all such sums of money as
may be provided from time to time by the Government :–
(2) (a) All grants and donations received by the
Department;
(b) all gifts and other contributions made by the
banks and banking societies established under
this Act;
(c) such percentage of money as may be prescribed
by the Minister, of the profit of the banks and
banking societies established under this Act; and
(d) any other money that may be received under
this Act,
shall be credited to the Consolidated Fund and shall
thereafter, with the approval of the Parliament, be
credited to the Divineguma Development Fund.
24 Divineguma Act, No. 1 of 2013
(3) The moneys lying to the credit of the above Fund
may be utilized for such purposes and in such manner as
may be prescribed by the Minister from time to time.
Divineguma 37. (1) There shall be established for the purpose of
Revolving Fund. this Act, a fund called "Divineguma Revolving Fund".
(2) All monies lying, on the date immediately prior to
the appointed date, to the credit of the revolving fund of, the
Samurdhi Authority of Sri Lanka established under the
Samurdhi Authority of Sri Lanka Act, No. 30 of 1995, the
Southern Development Authority of Sri Lanka established
under the Southern Development Authority of Sri Lanka
Act, No. 18 of 1996 and the Udarata Development Authority
of Sri Lanka established under the Udarata Development
Authority of Sri Lanka Act, No. 26 of 2005 shall stand, with
effect from the appointed date, transferred to the Divineguma
Revolving Fund established under this Act.
PART IX
GENERAL
District 38. The District Secretary of each district shall function
Secretaries to be as an Additional Director-General of the Department in
Additional
Director- respect of the respective district.
General.
Declaration of 39. The Director-General, Additional Directors-General,
Secrecy. every Director, Deputy Director, Assistant Director and
officers and servants of the Department, shall before entering
upon his duties sign a declaration pledging himself to
observe strict secrecy respecting all matters connected with
the working of the Department and shall by such declaration
pledge himself not to disclose any matters which may come
to his knowledge in the discharge of his functions, except –
(a) when required to do so by a court of law; or
(b) in order to comply with any of the provisions of
this Act or any other written law.
Divineguma Act, No. 1 of 2013 25
40. (1) For the purposes of enabling the Department to Returns and
exercise and discharge any of its powers and functions under Information.
this Act, the Department or any person authorized in that
behalf by the Department may, by notice in writing require
any person to furnish to the Department or to the person
authorized by the Department, within such period as shall
be specified in the notice, such returns and information as
shall be specified in such notice and require any person to
be present before the Department.
(2) It shall be the duty of any person who is required by
a notice under subsection (1), to furnish any return or
information or to be present before the Department to comply
with the requirements of such notice within the period
specified in such notice, except where such person is
prohibited from furnishing such returns or information under
the provisions of any other written law.
(3) No information contained in a return furnished in
compliance with a notice issued under subsection (1) shall
be published or communicated by the Department or any
officer, servant or agent of the Department to any other
person except with the consent of the person furnishing such
return or information or in the course of the discharge of the
functions of the Department.
(4) Every person who makes any statement before the
Department shall in respect of such statement, be entitled
to all the privileges to which a witness giving evidence
before a court of law is entitled in respect of evidence given
by him before such court.
41. Any person who acts in contravention of any of the Offences.
provisions of this Act or any regulation, rule or direction
made or issued thereunder, shall be guilty of an offence
under this Act and shall on conviction after summary trial
by a Magistrate be liable to a fine not exceeding two
thousand five hundred rupees or to imprisonment for a term
not exceeding two years.
42. (1) The Minister may make regulations for the Regulations.
matters required by this Act to be prescribed and for matters
in respect of which regulations are authorized to be made.
26 Divineguma Act, No. 1 of 2013
(2) Without prejudice to the generality of powers
conferred by subsection (1), the Minister may make
regulations in respect of all or any of the following matters:-
(a) the constitution and administrative structure of the
divineguma community based orgnizations and
matters connected with such constitution and
administrative structure;
(b) the constitution and administrative structure of
the divineguma regional orgnizations and matters
connected with such constitution and
administrative structure;
(c) the constitution and administrative structure of
the Divineguma Community Based Banking
Union and matters connected therewith or
incidental thereto;
(d) registration of divineguma community based
banks, requirements to be fulfilled with respect to
such registration and cancellation of such
registration and banking activities of the
divineguma community based banks and matters
connected therewith or incidental thereto;
(e) registration of divineguma community based
banking societies, requirements to be fulfilled with
respect to such registration and cancellation of such
registration and activities of the divineguma
community based banking societies and matters
connected therewith or incidental thereto;
(f) criteria in respect of the selection of divineguma
beneficiaries;
(g) criteria to be a member of divineguma community
based organizations and diveneguma community
based banks;
Divineguma Act, No. 1 of 2013 27
(h) criteria in respect of the supervision, regulation and
evaluation of divineguma community based
organizations, divineguma community based banks
and divineguma community based banking
societies;
(i) delimitation of the area of authority of
implementation and administration of divineguma
programmes at rural, regional or district levels;
(j) all matters connected with the Divineguma
Development Fund and the Divineguma Revolving
Fund;
(k) all matters connected with the funds maintained
by divineguma community based organizations,
divineguma regional organizations, divineguma
community based banks and divineguma
community based banking societies;
(l) the procedure for the settlement of disputes that
may arise when giving effect to the principles and
provisions of this Act and matters connected
therewith or incidental thereto; and
(m) the use of a common logo for divineguma
programmes.
(3) Every regulation made by the Minister shall be
published in the Gazette and shall come into operation on
the date of such publication or on such later date as may be
specified in the regulation.
(4) Every regulation made by the Minister shall no later
than three months after its publication in the Gazette be
brought before the Parliament for approval. Any regulation
which is not so approved shall be deemed to be rescinded
from the date of such disapproval but without prejudice to
anything previously done thereunder.
(5) Notification of the date of such disapproval shall be
published in the Gazette.
28 Divineguma Act, No. 1 of 2013
Rules. 43. (1) The Director -General may, in consultation with
the Divineguma National Council, make rules in respect of
policy and management of affairs of the Department.
(2) Every rule made by the Director-General shall not
come into operation until it is approved by the Cabinet of
Ministers.
(3) Every rule so approved shall be published in the
Gazette.
PART X
REPEALS AND SAVINGS
Repeal of the
44. The Samurdhi Development Authority Act, No.30
Samurdhi
Development of 1995, the Southern Development Authority Act, No.18 of
Authority Act, 1996 and the Udarata Development Authority Act, No.26 of
No.30 of 1995, 2005 are hereby repealed. Notwithstanding the repeal of
the Southern the aforesaid Acts:-
Development
Authority Act,
(a) all activities carried out by the Commissioner-
No.18 of 1996
and the Udarata General under the repealed Samurdhi Development
Development Authority Act, No. 30 of 1995, in the
Authority Act, implementation of the poverty alleviation
No.26 of 2005 programmes and other programmes of the
and savings.
government, shall be deemed to be carried out and
shall continue to be carried out, under this Act;
(b) all property movable and immovable, belonging
to the Samurdhi Development Authority, Southern
Development Authority and Udarata Development
Authoirty established under the repealed Acts
(hereinafter reffered to as the “said Authorities”)
as at the date immediately prior to the appointed
date shall with effect from the appointed date vest
in and be deemed to be the property of the
Government;
(c) all suits, prosecutions, actions, proceedings, matters
or things which have been instituted by or against
Divineguma Act, No. 1 of 2013 29
the said Authorities and which are pending as at
the date immediately prior to the appointed date
shall with effect from the appointed date be deemed
to be suits, prosecutions, actions, proceedings,
matters or things which have been instituted by or
against the Government;
(d) any decree, order or award entered or made in
favour of or against the said Authorities by any
court or tribunal or other body in any action, matter,
proceeding or thing shall with effect from the
appointed date be deemed to be a decree, order or
award entered or made in favour of or against the
Government and may be enforced accordingly;
(e) such officer or servant in the employment of the
said Authorities, as at the date immediately prior to
the appointed date shall-
(i) where such officer or servant does not opt to
join the service of the Department and opts
for voluntary resignation from the service,
such officer or servant be paid such
compensation which shall be paid in terms of
a voluntary retrenchment scheme as shall be
prescribed by the Minister;
(ii) where such officer or servant opts to join,
with effect from the date of appointment to
such posts in the respective authority, the
service of the Department, such officer or
servant, be deemed with effect from such date
of appointment and subject to the approval
of the Public Service Commission, to be an
officer or a servant of the Department and
be eligible for a pension under the provisions
of Minutes on Pensions taking into
consideration the contributions made by the
respective Authorities to such Provident Fund;
30 Divineguma Act, No. 1 of 2013
(iii) where such of officer or servant opts to join
the services of the Department-
(aa) if such officer or servant is eligible for
the receipt of any sum of money under
the Employees Provident Fund Act,
No. 15 of 1958; and
(bb) if such officer or servant is eligible for
the receipt of any sum of money under
the Employees Trusts Fund Act, No. 46
of 1980,
such officer or servant shall recover such sum
of money and may, subject to the approval of
the Public Service Commission, join the
service of the Department. Such officer or
servant shall, with effect from the date of
appointment to the service of the Department,
be deemed to be an officer or a servant of the
Departmeant. Further, the date on which such
officer or servant is appointed to the service
of the Department, shall be deemed to be the
date for the purpose of computation of the
pension; or
(iv) where such officer or servant who opts to
join the service of the Department and also
opts to contribute to the Employees’
Provident Fund and the Employees’ Trust
Fund, such officer or servant shall, subject to
the approval of the Public Service
Commission, with effect from the appointed
date, be deemed to be an officer or a servant
of the Department and shall continue to
contribute to the same :
Provided however, such officer or servant
shall not be entitled to a pension under the
provisions of Minutes on Pensions ;
Divineguma Act, No. 1 of 2013 31
(f) all debts, obligations, assets and liabilities incurred,
all contracts and agreements executed or enforced
into and all matters and things engaged or agreed
to be done by, with or for the said Authorities and
all licences issued for and on behalf of the said
Authorities, as at the date immediately prior to the
appointed date shall, with effect from the
appointed date be deemed to be debts, obligations,
assets and liabilites incurred, all contracts and
agreements executed or enforced into and all matters
and things engaged or agreed to be done by, with
or for, and licences issued for and on behalf of, the
Government ;
(g) all samurdhi banking societies and samurdhi
banking federations that are in operation on the
date immediately prior to the appointed date shall,
with effect from the appointed date be deemed to
be divineguma community based banks and
divineguma community based banking societies
respectively;
(h) every person who has applied for, or is in receipt of,
any welfare benefit, from Samurdhi Authority or
Samurdhi Commissioner General in terms of any
written law or otherwise, shall notwithstanding
anything to the contrary in this Act, be eligible to
apply for the receipt of or continue to receive, such
benefit under the provisions of this Act.
45. The trusts and funds established for any object by Trusts and funds
or under the Samurdhi Development Authority of Sri Lanka under the
repealed Acts to
established under the repealed Act, No. 30 of 1995, Southern
be deemed to be
Development Authority of Sri Lanka established under the trusts and funds
repealed Act, No. 18 of 1996, Udarata Development under this Act.
Authority of Sri Lanka established under the repealed Act,
No. 26 of 2005, shall be managed by the Department ensuring
that there shall be no change with regard to the object and
the purpose for which such trusts and funds were established
and the beneficiaries.
32 Divineguma Act, No. 1 of 2013
This Act to 46. In the event of any conflict or inconsistency
prevail over between the provisions of this Act and the provisions of any
other written
other written law, the provisions of this Act shall prevail.
law.
Interpretation. 47. In this Act, unless the context otherwise requires:-
"Central Bank" means the Central Bank of Sri Lanka
established under the Monetary Law Act,
(Chapter 422);
"community" means plantation, urban or industrial
sectors of the public;
"divineguma beneficiary" means any person who
obtains any kind of benefit or assistance under
any programme, project or activity carried out
by any divineguma community based
organization or divineguma regional
organization;
"micro-finance" means a type of banking service
that is provided to employed or low-income
individuals or groups who would otherwise
have no other means of gaining financial
services;
"Minister" means the Minister to whom the
subject of Divineguma is assigned ; and
"National Lotteries Board" means the National
Lotteries Board established under the National
Lotteries Board Act, No. 11 of 1963.
Sinhala text to 48. In the event of any inconsistency between the
prevail in case Sinhala and Tamil texts of this Act, the Sinhala text shall
of inconsistency.
prevail.

Divineguma Act, No. 1 of 2013 33
Annual subscription of English Bills and Acts of the Parliament Rs. 885 (Local), Rs. 1,180
(Foreign), Payable to the SUPERINTENDENT, GOVERNMENT PUBLICATIONS BUREAU, DEPARTMENT OF
GOVERNMENT INFORMATION, NO. 163, KIRULAPONA MAWATHA, POLHENGODA, COLOMBO 05 before 15th
December each year in respect of the year following.
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