Cyprus Mail

Koshi waste treatment contract still up in the air

The Interior minister and the Auditor-general after the last bout of acrimony last year

By Elias Hazou

THE ball is now in the court of independent officials on how to handle a contentious contract awarded to the operators of the solid-waste treatment facility at Koshi.

Following a meeting on Thursday with interior minister Socratis Hasikos, it was decided that the Attorney-general, the Auditor-general, the Commissioner for State Aid Control and the state treasurer (who heads up the Central Committee of Amendments and Claims) will jointly confer and decide on the contract.

“Here’s what I told them: take over and handle this scandalous contract as you see fit. I’ve done everything I can,” Hasikos said later in his trademark plain-spoken style.

On assuming office in 2013, Hasikos sought to amend the agreement between the government and the Koshi contractor that was struck back in 2006.

The original deal provided for high processing fees – €75 per tonne of waste – for the citizens of the Larnaca and Famagusta districts.

After negotiations, Hasikos got the contractor to lower the rate to €39.90 per tonne in exchange for a seven-year extension on the contract.

But an actual updated agreement was never signed, due to objections raised in the meantime by the Auditor-general, who argued that the new arrangement risked a fine, or even overturning the agreement, from the European Union, on the grounds that, on balance, it incurs a benefit to the contractor.

Meanwhile, the Commissioner for State Aid Control looked into the case, finding that the contract extension negotiated by Hasikos constituted state aid, prohibited under EU laws and thus risking fines from the European Commission.

Speaking to reporters after Thursday’s meeting, Hasikos said he would go along with whatever solution the independent officials now come up with.

“Do I have a choice?” he quipped.

But, he warned journalists, time is of the essence. On the one hand, as long as the matter is up in the air, people will keep paying for the higher Koshi rate.

On the other hand, he said, the landfill at Kotsiatis is already “spilling over” and within a matter of months would be unable to take more garbage, which would need to be diverted to the Koshi plant.

“Once Kotsiatis overflows, what are we going to do? The site has maybe one year left. It should have already been shut down.”

Hasikos says he realised from the outset that the initial Koshi contract was scandalous and to the detriment of the taxpayer. He had to act practically and fast to keep the waste treatment plant operating, otherwise garbage would begin piling up in Nicosia.

So he decided to renegotiate a lower waste processing fee, although final approval rested with the Central Committee of Amendments and Claims – the body responsible for amendments to public contracts.

The Attorney-general investigated the initial 2006 contract, but found no evidence of criminal wrongdoing.

However a ministerial probe ordered by Hasikos did determine that civil servants were responsible for the lop-sided deal.

“Today, these people are no longer with the civil service. But it goes without saying that political responsibility for this contract exists,” the minister said.

Last month, a row erupted between Hasikos and Auditor-general Odysseas Michaelides after a letter concerning Koshi and addressed by the latter to the former found its way to the press.

Hasikos accused Michaelides of leaking official correspondence, a claim which the Auditor-general denied.

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