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Cyprus

MPs start CY probe with questions on fleet and staff spending

KPMG's Nicos Syrimis at the parliamentary ad hoc committee on CY

By Jean Christou

DEPUTIES investigating the demise of Cyprus Airways (CY) are demanding to know why the airline bought 14 aircraft between 1980 and 1990 and why staff numbers increased by a whopping 40 per cent in 1987, making labour costs the state-owned company’s single biggest overhead.

The discussion into the financial history of CY, which folded on January 9 this year when the European Commission ruled that the national carrier needed to return some €65m in illegal state aid, is being discussed at an ad-hoc parliamentary committee.

Questions were put to Finance ministry and Audit office officials on Friday, along with the airline’s long-time auditors KPMG.

Committee chairman Nicos Tornaritis presented the officials with a list of questions deputies wanted answered by the next session, which will take place next week. “We have to get to the truth,” he said.

According to the Cyprus News Agency, KPMG representative Nicos Syrimis said that between 1981 and 1989 CY did not have any financial issues.

Asked about the huge bump in staff in 1987 from 1,080 to 1,500, he said it was more or less justified as the airline had increased business.

Syrimis said there had never been a hint of fraud in the airline’s accounts.

DISY MP Marios Mavridis asked that not only should financial records be handed over, but also internal memos and documents.

Speaking after the meeting, DIKO MP Antonis Antoniou said that the Commission was starting with the purchase of new aircraft and the staffing levels.

EDEK’s Nicos Nicolaides said there had obviously been acts and omissions that had contributed to the downward spiral of the company. He also mentioned “unnecessary recruitment” and questioned “who had advised the purchase of new aircraft?”

EVROKO deputy Demetris Syllouris said it was crucial to examine all documentation from the decade 1980 to 1990, particularly on the purchase of the new aircraft.

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