Cyprus Mail
Cyprus

‘Historic’ deal reached on public sector reform

Pasydy leader Glafcos Hadjipetrou

By Angelos Anastasiou

The government and civil servants’ union PASYDY have reached an agreement on overhauling appraisal, promotion, and transfers in the public sector, Reform Commissioner Constantinos Petrides announced on Wednesday.

On what he deemed a “historic day for the public service”, Petrides said the dialogue with the union’s top brass had not taken too long because “good will was exhibited on both sides”.

“Jointly with PASYDY, we have come to a radical agreement with regard to reform,” he said.

“It encompasses issues that have been the object of decades-old discussion, which were never followed by the requisite changes. The introduction of a new procedure for promotion designed to reward value, based on objective criteria like written examinations and a point-system, has been agreed, as well as another topic discussed for many years – a modern appraisal system, which will rank civil servants on the basis of bell-curve rating.”

Additionally, Petrides said, a new transfer arrangement has been agreed, which will help address the needs of the civil service in a flexible manner, “when and where they may come up”.

The Reform Commissioner said the government aims for the new system to go live on January 1, 2017.

Meanwhile, consultations between the government and the union continue on other fronts, including the government’s proposal for the consolidation of the public payroll.

“We all know that due to the crisis the public payroll has been frozen till year-end 2016,” Petrides recalled.

“After this time, the government’s view is that a way must be found for any increase in the payroll to reflect reality, in tandem with the economy’s needs. Otherwise, the risk would be to resort either to increased borrowing, or tax-hikes.”

According to Petrides, the union has expressed reservations on this matter, which it will discuss further internally.

“We have a reservation, but it is not a ‘casus belli’,” said PASYDY leader Glafcos Hadjipetrou.

“What is important is that we have entered a new era, in which dialogue is the way forward, and I hope that dialogue can help us solve many other problems that have been festering for too long.”

Asked whether the Troika – Cyprus’ international creditors – approves of the deal, Petrides cited a term in the loan agreement that called for the modernisation of the system.

“But we didn’t need the Troika to tell us that this system had many weaknesses and needed to be modernised,” he said.

“This wasn’t just a Troika demand, it was also in President Anastasiades’ campaign programme. It is also a universal demand of society, and it was a demand of political parties, which I have consulted with.”

Petrides conceded that such drastic overhaul will come at a cost, but said the money must be used so that the civil service can become fairer, more efficient, and serve the citizens better.

“This reform effort, as well as the fiscal aspect of the state payroll, is in the context of standing on our own two feet and wanting to exit the loan agreement earlier than scheduled – but in order to exit it earlier, we need to make sure we will never require the help of outsiders,” he explained.

Meanwhile, the Troika’s seventh review of Cyprus’ economic adjustment programme continued on Wednesday, with mission technocrats looking at three major areas: the finance sector, fiscal performance, and structural reforms.

In the finance sector, high-ranking government sources cited by the Cyprus News Agency said, progress has been made on a bill regulating the issue of borrowers not issued title deeds because of defaulted land developers, while a bill on loan securitisation has been forwarded to the Legal Service for vetting.

On structural reforms, a major breakthrough was announced today by Petrides, while progress has also been made on the privatisations front.

According to CNA, the official said that upon conclusion of this review, the Troika is expected to disburse a €500 million tranche.

The source added that two reviews remain until the programme expires in March 2016.

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