Cyprus Mail

Bus company disputes claim it owes money to the state

File photo: Buses from the Zenon bus company

By Evie Andreou

The Larnaca public transport company Zenon, not only does not owe money to the state from overpayments made in the past but is owed money by the state, its chairman Loucas Louca said on Thursday.

Public transport companies said that they were facing closure if the government deducts substantial amounts from the monthly subsidy payments made to them, after it was announced that the state would recover the around €25m owed to it by the companies.

Transport Minister, Vassiliki Anastassiadou, announced on Wednesday that the government must reclaim that money following a ruling of an independent arbitration committee that was tasked about a year ago to weigh in on the matter. The government and the six public transport companies had agreed to seek the input of the committee about a year ago following disagreements as to the amount owed to the state from overpayments to the bus companies.

The minister is to meet within the coming days with representatives of the bus companies to discuss the best way of recovering that money without at the same time choking them financially.

According to Government Spokesman, Prodromos Prodromou, there are big variations among the amounts each company owes to the state. Not all companies, owe the same amount he said.

But according to the chairman of Zenon, that was told they owe some €800,000 to the state, the company, according to their own calculations, must receive money.

“We are sure that they owe us money,” Louca told state broadcaster CyBC, citing “serious financial differences.”

Louca referred to failure of the state to abide by the provisions of the 10-year contracts it signed in 2009 with the public transport companies.

Companies, according to the provisions, he said, were obliged to submit their annual financial statements by the summer of the next year and the transport ministry had to had to check them and inform the companies within two months of any differences.

“They came to us in October and gave us the results for 2012, (saying) that we had paid the bus drivers more money, which the state had forced us to do as part of collective agreements,” Louca said.

He added that the company had paid at the time the salaries, social insurance and taxes.  “Are we now going to ask the drivers to give us that money back?” he asked. This problem occurred, he said, because “everyone insists to-date to interpret collective agreements as they wish.”

Louca also said that the company, at the moment, has a €3.5m debt – excluding the money the government wants back – and that if they do not receive state payments to pay 13th salaries of the staff and pay their suppliers, the company would close down.

“We are ruined and they want money back. They can come check my personal accounts. It is their mistakes and we have to pay for them,” he said.

Louca also said that he has already arranged to meet with the minister and expressed hope that they would come to an understanding. At the same time, however, he said that the company is already preparing to take legal action against that decision.

“We believe we will win,” he said.

Deputy head of the House transport committee, Diko’s Charalambos Pittokopitis, said that it was also the government’s fault for allowing the situation to get this far and called for those state officials who contributed to this mess to answer for their actions.

Last March, permanent secretary of the transport ministry, Alecos Michaelides, had said that all bus companies received overpayments, but the worst cases were Paphos’ Osypa and Intercity buses. The biggest chunk of overpayments made, he said, resulting from setting high the cost per kilometre for which the companies receive government subsidy, was between 2010 and 2014.

The contracts between the government and public transport companies expire in July 2020. The transport ministry is to announce within the coming weeks a new, international tender competition, for the new contracts which will be in effect from August 2020.

Bus drivers in all districts have gone on several strikes in recent years over late payment of salaries, as a result of the financial disagreements between their employers and the government.



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