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Cyprus

Legal loophole purchased CyTA CEO’s car

CyTA director general Aristos Riris told MPs his car cost far less than his predecessor's and was part of his contract with the semi-government organisation

By Poly Pantelides

LAWMAKERS on Monday refused to approve a budget of almost €160,000 for the purchase of service cars by state telecommunications company, CYTA, accusing the body of trying to force their hand by spending the money on the sly.

The House Finance Committee was discussing a request to approve €157,500 which CyTA had spent on cars for employees earlier in the year and before its budget for 2013 had been approved. Some €58,000 of that related to the service car belonging to CyTA’s CEO, Aristos Riris.

By paying for the cars before its budget had been approved, CyTA was making use of a standard practice whereby state-funded bodies can spend money prior to their budgets being approved to cover administrative expenses.

The law allows parliament to authorise bodies to spend part of their budget – up to a maximum of two months’ spending of the previous year’s budget – if it is considered necessary for the provision of public services.

CyTA CEO Riris, who replaced Fotos Savvides in November last year, got a car worth €58,000 this January as per the terms of his contract. Riris told the committee his contract allowed him to spend up to €77,000. Instead, he asked for a car that was almost 25 per cent cheaper, he said.

The car allowance was part of the contract agreement between CyTA and Riris, but head of the finance committee Nicolas Papadopoulos called for the re-examination of such wasteful practices at a time when the country’s economy is in crisis.

“This mentality of spending public money must be re-examined,” he said. He accepted that Riris’ contract had been signed during that grace period allowing CyTA to continue spending for its needs, but added it was not designed to be abused in the way it had – by signing a personal contract to allow an executive the use of a limo.

In addition to Riris’ car, in December CyTA paid €99,400 for four other cars.

Riris justified CyTA’s actions by pointing out that his predecessor also enjoyed the same benefits in his own contract. This included paying off at the end of his term the residual value of the car he used as a CEO. On retirement at the age of 63, Savvides, the previous CyTA CEO, bought the Jaguar he used during his term for €12,000. CyTA had paid €77,000. Savvides also got a bonus of €60,000 in addition to the standard lump-sum payment he was due to receive on retirement.

The Green Party’s MP, Giorgos Perdikis, said Parliament was being faced with a scandalous and provocative spending of money. MPs said they would discuss the matter among their own parties and come back with a decision on whether they would ratify a budget that has already been spent.

CyTA chairman, Stathis Kittis, was not yesterday present in the discussion. He is currently involved in investigations over a dodgy land deal that has implicated parties, unions, police officers, businessmen and the board itself.

Meanwhile, deputies are still discussing a bill to limit spending on luxury cars for which 51 state officials are currently eligible. In its current form, the bill limits the rights to a luxury car plus a chauffeur, maintenance and fuel costs to the Presidents of the Republic, Parliament and the Supreme Court, Cabinet ministers, and the government spokesman and the undersecretary to the President and the attorney-general. The state’s auditor-general and accountant-general would be entitled to just a car. But ruling party DISY wants to include in that list the permanent secretaries and any deputy ministers that might be appointed, to allow them use of a car without a driver or fuel allowances.

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