Cyprus Mail

Cabinet approves CyTA bills (Updated)

By Angelos Anastasiou
A government bill allowing the creation of a private-law telecommunications company to replace the public-law Cyprus Telecommunications Authority (CyTA) was approved by the cabinet, Finance Minister Harris Georgiades announced on Wednesday.
According to Georgiades, the new organisation will help the state telecoms company operate with greater flexibility and cope better in an increasingly competitive field.
“A very important bill was approved today, one which modernises CyTA […] and allows it to function more efficiently in a sector as specialised as telecommunications,” he said.
“This is achieved by the creation of a company operating under private law instead of an arm of the public sector, thus reaping the benefits of increased flexibility.”
At the same time, he added, this bill – provided it is ratified by parliament – will allow the government to look into attracting a strategic investor at a later stage, tentatively identified a year from now.
“This would incur modern and effective management, as well as synergies on a regional scale, in a way that safeguards the organisation’s value and prospects,” Georgiades argued.
He then repeated the view that CyTA cannot remain the last telecommunications organisation across Europe to function as a branch of government, but was also careful to reiterate that in any case, employees’ rights and entitlements are fully safeguarded.
“First of all, at this initial stage of creating a wholly state-owned private-law company, there will be no change,” the finance minister said.
“The next stage of a possible investment by a strategic investor has been discussed, and a proposal that offers employees options and safeguards has been approved.”
Georgiades was referring to a government proposal regarding employees’ status post-privatisation, which offers them four options to choose from. CyTA employees may opt to take a voluntary retirement scheme, or be moved to other departments of the public sector, or work for the new privately-run entity – either as outright employees after resigning their old CyTA job or by secondment from CyTA to the privatised company.
“Also, as agreed, all the bills regarding labour rights and the next stage [to privatisation] will be ready in the coming weeks so that all legislation can be brought to the House as a whole,” Georgiades said.
In light of recent anti-privatisation rhetoric by opposition parties, the finance minister described the possibility of the bills being opposed by parliament as a “missed opportunity, both for CyTA and our economy”.
“It will be a serious defeat if partisan negation thwarts the promotion of these reforms,” he said.
“What it comes down to is that our proposal at this point is not denationalisation, but the creation of a private-law company that will be fully state-owned, that even under state ownership will be in a position to function much more efficiently than it does today,” he said.
But, he acknowledged, “the government candidly adds that the aim is to attract a strategic partner”.

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