Cyprus Mail
Cyprus

Contract irregularities in one state building cost almost €2 million

The issue dates back to when Chrystalla Georghadji was governor of the central bank

By Evie Andreou

Investigations are underway into irregularities that cost the tax payer around CYP£1.1 m (€1.88m) for the construction and maintenance of the audit service building, vice president of the House watchdog committee Aristotelis Misos said on Tuesday.

The issue was brought to the fore in February by the audit service itself, which sent a letter to the government’s technical services citing possible irregularities in the construction and maintenance of its own office building, which it has been in since 2006. The issue was raised at the House watchdog committee by Greens MP George Perdikis.

Misos said that more than CYP£950,000 plus VAT was paid to the contractor, while a further CYP£150,000 interest accrued on the amount borrowed by the state.

“For us it remains an open issue and we are waiting for the auditor general in consultation with the Attorney General, to consider whether, in addition to… the procedures followed, to take all necessary legal measures for the return of that amount to the government,” Misos said.

The CYP£3m (€5.12m) contract for the construction and maintenance for 15 years of the building was awarded in 2004.

AKEL MP Irene Charalambidou said that “contracts disappeared and reappeared with different terms”. She said the contractors held contracts with different terms than the government’s copies while “terms that were absent from the copy of the Republic were beneficial for the contractor and yielded (to his benefit) up to CYP£150,000 interest”.

MPs also heard that when it rained, employees in the lower basement “needed an umbrella”, that the building is not soundproofed and not energy efficient.

Neighbours had also complained about the mural painted outside the building, which they said resembled a cabaret decoration, and the then auditor general Chrystalla Georghadji had given instructions to stop lighting it.

An officer of the audit service told MPs that when he sent a report to Georghadji inquiring about the irregularities she replied that she did not understand and the case was closed until Michaelides took over.

Perdikis said that the standard procedures often invoked by Georghadji in House meetings were in fact shady “from the top floor to the basement”.

He said that for 10 years the contractor refused to carry out any maintenance on the building, and it was only after Michaelides took over “and after much persistent pressure” that he started doing maintenance work as provided in the contract.

“Worst of all we are talking about a… model project that was supposed to be the example of how government buildings should be built,” Perdikis said. “It appeared later that we had scamming, tragic mistakes, and exploitation of the public by a private individual”.

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