Cyprus Mail
CM Regular Columnist Opinion

Yet again, auditor’s report sheds light on disgraceful SGOs

By Loucas Charalambous

A DAY rarely goes by without some news report about the corruption, mismanagement and abuses at semi-governmental organisations which cost many millions of euros that are paid by the citizens of this country either as customers of these organisations or as taxpayers. The latest report by the auditor-general is full of shocking examples that suggest the SGOs have in effect become a public danger.

The data about CyTA in the report paints a bleak picture about its present and future. From its misguided investments in nine subsidiaries, which no business logic could have justified, CyTA, according to the report, incurred losses of €97 million by the end of 2014.

The report also censures the irrational squandering of millions through Cytavision which was giving huge amounts of money to football clubs either in broadcasting rights for matches (APOEL alone received €1.7 million for the season that just ended) or as sponsorships which amounted to almost €3 million. Such mindless spending by a loss-making company defies belief.

The auditor-general also refers to the huge loss of €80 million caused by the fall in the value of real estate in which the CyTA pension fund had invested. Another €96 million was lost from bad investments by the fund as well as the 2013 haircut of bank deposits.

We must remember these last two figures. When in the not too distant future there is no money in the fund to pay the super-pensions of CyTA employees, some deputies will go to the legislature and propose that all the millions needed are paid for by the state – in other words the state would have to borrow more money to be repaid by the taxpayer.

A proposal of this type has already been made to cover the pensions of another group of labour princes – the employees of CyBC whose pension fund has a deficit of €100 million. In fact one deputy proposed that the CyBC pensions be paid from the Consolidated Fund of the state, in other words, the taxpayer. This is over and above the €30 million we pay every year to maintain this costly corporation.

There was a news report about the squandering of money at the CyBC this week. The most interesting bit of information given was that the corporation remains the undisputed champion among SGOs with regard to the salaries and benefits it pays full-time, permanent staff. The average cost for a permanent worker at the CyBC in 2014 was a staggering €61,000, compared to €53,163 for CyTA workers and €43,696 for those at the EAC.

For someone to understand what these figures mean, you should take into account that the average cost per employee at companies in the private sector is between €18,000 and €25,000. It is a staggering provocation that CyBC, which is maintained by the money of the taxpayer, has the highest average cost per employee in the country.

These are the SGOs which the leaderships of AKEL, DIKO and the rest of the opposition parties are fighting tooth and nail to keep under their current regime and prevent privatisation. It is these corrupt and, in effect, bankrupt organisations that they have labelled “public wealth” and are railing against their privatisation, even after it has been proved that SGOs are more “public danger” than “public wealth”.

The fact that the former chairman of CyTA together with a member of the board of directors, the general secretary of one of its unions and some associates are now serving time for corruption and for plundering the authority’s pension fund does not seem to bother Kyprianou, Papadopoulos, Sizopoulos and the rest of our political demagogues; neither are they bothered about the never-ending squandering of funds recorded in the auditor-general’s report.

The only thing they are interested in is demagoguery and attracting the votes of the SGO employees. For them, only votes matter, nothing else.

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