Cyprus Mail

Georgiades sees signs of déjà vu

Finance Minister Harris Georgiades
Finance Minister Harris Georgiades

By George Psyllides

FINANCE Minister Harris Georgiades yesterday said he was concerned that with a return to economic stability, the same attitudes that caused the collapse of the financial sector appeared to be resurfacing.

The minister was addressing workers from semi-state telecoms company CyTA where he addressed the thorny issue of privatisations and told them not to cling to the mentality of the past.

“On one hand I am optimistic because despite different approaches we have succeeded in the past few years, with joint responsible decisions, to cover significant distance. On the other hand I’m worried because attitudes are being recorded that show that we did not learn from our mistakes… attitudes that believe stabilisation and the prospect of recovery, which we achieved with difficulty and with the sacrifices of our fellow citizens, is an opportunity to return to those practices and mentality that caused our economy to derail.”

Georgiades said the country was “at a critical and defining crossroads”

“We either continue with the course of correction, a course that has already started to show tangible results, or we will get carried away again in the dead end of dogmatic denial and slogans. We either intensify efforts with seriousness, determination and with confidence, or will slide back into uncertainty, instability and crisis,” he added.

He called for a willingness to cooperate, and mutual respect, in the address to CyTA union PASE and told them that as part of the process of denationalisation, the state would set up a new telecommunications company that will take over most operations currently carried out by CyTA, in a bid to attract investment.

The minister reiterated the government’s pledge that all workers’ rights would be secured.

Georgiades said the opportunities for CyTA were linked with its transfer to a new regime as he warned of the risks of clinging to the structure and mentality of past decades “under the illusion that attachment to the past would lead to the future.”

The plan, Georgiades said, was to create a new state company, which would take over the biggest part of the services provided by CyTA.

Workers can then choose to join the new entity, or retire, or continue to be employed at the public sector.

“In any case, the workers would get opportunities and choices … the pension rights will be fully secured, and no employee would lose their status unless they choose to do so,” the minister said. “And certainly, no worker would be laid off.”

The government faces an uphill battle with privatisations, as opposition parties, which have the majority in parliament, are against them.

Speaking on the sidelines of the conference, PASE general-secretary Alecos Tryfonides suggested that the transfer of operations to a new company were related to the difficulty in changing the island’s constitution, which demands a two-thirds majority.

Tryfonides reiterated that privatisations were a “national crime.”

“Sale is not an investment; I repeat that so that the Cypriot people understand that selling your property is not an investment,” he said. “Investment is when a foreign investor comes and creates their own telecoms company and competes with CyTA and we do not fear competition.”

PASE chairman Giorgos Miltiadous said a proposal by main opposition party AKEL to suspend privatisations until 2017 was their idea so that time would be given to CyTA to reorganise and to the island to exit the crisis, thus avoiding the sell-off of the organisation.

On Monday MPs from across the board said that a bill designed to boost financial transparency in state-owned and semi-public enterprises was really a way for the government to wrest control away from parliament ahead of the privatisation process.

The government bill provides for the introduction of a process that starts with drafting annual budgets and their timely submission in a unified form for all organisations. It also sets the qualifications, responsibilities, and procedure to appoint and dismiss boards, and includes provisions about conflict of interest.

But for MPs, a key bone of contention is a clause allowing the government of the day to abolish, merge or sell off departments of these organisations, without parliamentary approval. Currently, such action needs the nod from parliament.

Georgiades addressed the concerns saying there had been “inaccuracies and exaggerations”

He said there were no provisions that would impinge on workers’ rights or those of the parliament.

“There are however adjustments that reinforce accountability, transparency and effective and reliable audit… arrangements, which among others aim at preventing mismanagement that has cost millions, which the taxpayer has been burdened with, and which have unfortunately harmed several public organisations, including yours in the recent past,” he said.

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