Cyprus Mail

Warring sides stick to their guns in CBC hiring debacle

The governor of the Central Bank, Chrystalla Georghadji

By Angelos Anastasiou

MAIN opposition party AKEL criticised the Central Bank (CBC) Governor on Wednesday over her decision to rehire a secretary who had taken early retirement a couple of years ago, saying it will table the matter for discussion in parliament.

Koulla Savva had served as personal assistant to former Governors Christodoulos Christodoulou and Athanasios Orphanides before taking early retirement after Panikos Demetriades took over at the CBC in 2012, only to be brought back from retirement by Chrystalla Georghadji in May this year.

The issue had been raised by AKEL leader Andros Kyprianou, who had written to Auditor-general Odysseas Michaelides last month asking him to look into the legitimacy of Savva’s rehiring.

Following investigation, Michaelides confirmed Kyprianou’s suspicions and called the CBC’s board to cancel the employment procedure, copying in Georghadji in his letter of response.

“Despite the inherent particularities in the relationship between the head of a service and his or her personal assistant, and the head’s resulting right to select a qualified one among the staff, such particularities in no way justify either circumventing due procedure, or ignoring the fact that our country suffers unemployment levels that forbid the hiring of retirees to positions that could be filled by a currently unemployed individual,” Michaelides argued in his September 4 response to Kyprianou.

On September 15, Georghadji countered Michaelides’ arguments, reasserting the ‘special working relationship’ between a service head and a personal assistant as the premise of her decision.

“In light of the critical circumstances under which the CBC operates, the board reconfirmed the need for the continuous support of the Governor’s office by staff with experience in the required duties, so that they can support the Governor in the best possible manner,” she argued.

“The decision to employ Mrs K. Savva was based on the particularity of the professional relationship of an official with his or her personal assistant (which you acknowledge yourself), as well as the official’s right to select one,” she insisted.

“The board made the decision following a legal opinion from the CBC’s legal consultant,” she added. “Moreover, the board, in light of its obligation to secure the smooth functioning of the Bank’s operation, while fully acknowledging the prevailing economic circumstances, may not revoke its decision, provided it had been made lawfully in the first place.”

Seemingly unimpressed, Michaelides reverted to these arguments on the same day and insisted on his own positions.

“We advise you that your letter of response did not include any evidence we had not been aware of when we drafted our letter of September 4,” Michaelides pointed out. “Therefore, the Audit Service’s recommendation remains unchanged – namely, that the CBC’s board re-examine the issue immediately and cancel the employment procedure.”

And in a courtly stab at Georghadji’s “lawful decision” argument, Michaelides noted that Savva had been brought back before a board decision was made.

“In re-examining the decision, the board could consider the fact that employment (without written agreement) of said employee commenced on May 7, 2014, while the board decided on her employment on May 12, 2014, i.e. after the fact,” he said.

In her 2012 report as Auditor General Georghadji had lambasted Demetriades for rehiring two retired employees at the CBC, an incident that did not go unnoticed by Michaelides.

“With regard to your argument concerning the term-hiring of former CBC employees in 2012, it must be noted that these were made under completely different circumstances,” Georghadji said in her defence. “In any case, said contracts have already been terminated.”

However, a CBC source suggested things were not as straightforward.

The source told the Cyprus Mail that Savva had been effectively forced to take early retirement not long after Demetriades took over after she was accused of destroying CBC records.

She was replaced by her assistant, Eleni Markadji, who served under Demetriades during his two years as governor, and is said to have wielded great power. She was also known to have strong links with the leadership of AKEL.

After Demetriades’ resignation, Markadji was transferred to human resources but she could be the one replacing Savva, if she goes, because of ‘experience.’

AKEL attacked Georghadji over the issue it helped jump-start.

“Mrs Georghadji and the CBC’s board, provocatively ignoring the Auditor General’s clear recommendation to terminate the employment of her retired personal assistant, have created a serious issue of order that is worse than the initial decision to rehire the assistant,” AKEL said in a statement yesterday.

“Her stance deals a heavy blow to the already weakened credibility of national institutions,” the statement said.

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