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CyBC hits back at audit boss over pension fund

The CyBC

The Cyprus Broadcasting Corporation (CyBC) on Saturday hit back at the auditor-general’s allegations this week regarding mismanagement of its pension fund.

An internal investigation into the deficit in the public broadcaster’s pension fund, conducted as per the instructions of the CyBC’s board of directors, “showed no signs of mismanagement,” the announcement said.

In response to the auditor-general Odysseas Michaelides’ claims on Thursday regarding the “evaporation” over time of the CyBC’s pension fund reserves, hinting at potential criminal activity, the public broadcaster said that “the deficit was actuarial.”

Michaelides’ report showed that back in 2008, the fund’s reserves amounted to €53m; by 2016 they were down to just €3m.

According to CyBC, the reason for this was “inadequate funding” mainly in the period before 2013, which meant that the approved amounts on the broadcaster’s annual budgets were “on average much lower than the actual debts.”

As such, more money was leaving the fund as pensions than the amount of money coming in through funding.

From 2016 onwards, CyBC noted, the “annual needs for retirement benefits were fully covered by state sponsorship and staff contributions.”

It is also reported that of the €28 million state subsidy for 2018, approximately €7.5 million went toward the provision of retirement benefits.

Michaelides said on Thursday that he had referred this matter to the attorney-general, who has relayed the information to the police for investigation.

Besides the issue of the pension fund deficit, Michaelides also sounded a number of alarms regarding various practices of the CyBC, including its hiring practices, noting the growing trend of hiring people on a contractual basis rather than as full-time workers.

In his report, the auditor-general also flagged a problem with verifying the academic qualifications of staff. And there was the matter of ongoing lax conduct at CyBC, with managers failing to punch in and out.

“What message does the manager convey to the rest of the staff when he does not punch in his card?” Michaelides said.

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