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Cyprus

Situation with municipalities ‘cannot continue’

Interior minister Socrates Hasikos addressing the AGM

Interior minister Sokratis Hasikos on Tuesday again appealed to political parties to pass legislation relating to local government reform before the municipal elections on December 18.

The main thrust of the government legislation is to set up district bodies to handle much of the administrative work now done by each municipality. This would not only rationalise local government but also save money, most of which goes to salaries and pensions.

“The current situation can no longer continue,” Hasikos dramatically pleaded in a speech to the 33rd Annual General Meeting of the Union of Municipalities.

“I appeal to all parties concerned, assuring them that the government stands ready to assist and is willing to reach consensus, to vote through the reform before the elections,” he said.

The other major plank of the reform drive had been to slash the number of municipalities from 30 to 22 inside a three-year period.

But this has now been abandoned as unfeasible, as the December municipal elections will be held as scheduled, instead of being postponed.

Hasikos had recently suggested that the current terms of in-situ mayors and municipal councils be extended for two-and-a-half years – effectively scrapping this year’s elections.

The thinking behind the proposal was that it would not make sense to go to full-term elections when halfway through their terms some of the municipalities would be merged with others – as the reform drive had intended.

The parties in parliament, which had already begun campaigning for the elections, rejected the idea.

With regard to local government issues, president of the Union of Municipalities Alexis Galanos reiterated that the union of municipalities supports reform within the golden rule “better service to citizens at the lowest possible cost.”

He noted that despite the discussion of the bills in House committees, the union did not even know which municipalities would merge and what will eventually occur.

“What is also completely unclear, the government and finance ministry have not given a clear answer, is how the finances of the municipalities will be handled in any future mergers” he said, questioning what would happen with government subsidies that have been so drastically cut in recent years resulting in some municipalities being on the verge of bankruptcy.

He said the second part of the puzzle are the debts of the municipalities, noting that much of the debt should be undertaken by the state as it was created for the development of cities and communities, the state in other words.

Hasikos also urged municipalities to be “more flexible” in facilitating the issuing of title deeds to trapped buyers.

Despite legislation passed by parliament in 2015, local authorities are preventing the Land Registry from issuing title deeds to trapped buyers by refusing to issue Certificates of Approval for properties suffering from trivial planning infringements.

The law aimed to sort out the mess created by the failure to issue title deeds to people who paid for the property, either because the property was mortgaged by the developer, or the state could not go ahead with the transfer because of outstanding taxes.

Since developers’ land and buildings are counted as assets that need to be offset against their debt to banks, this gave lenders a claim on people’s properties that had been mortgaged by developers.

The law grants the head of the land registry department the authority to exempt, eliminate, transfer and cancel mortgages and or other encumbrances, depending on the case and under certain conditions. The entire process was meant to take around four months provided local authorities issued the necessary certificates first.

According to Hasikos, there are currently some 12,500 Certificates of Approval for trapped buyers pending who have filed applications under the law.

The local government reform legislation, Hasikos noted, would set up one body per district tasked with issuing town planning and building permits – taking that power away from local authorities.


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