Cyprus Mail

Huge drop in municipal charges after local government reform, says minister

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The cost of municipal fees and charges to the public will be as much as five times cheaper than now once local government reforms are in place, Interior Minister Nicos Nouris said on Monday.

Speaking after a meeting of the House interior committee, Nouris said the drafting of the bill had been completed and it was hoped to have the debate on the various issues by summer after the final draft is approved by the cabinet and submitted to parliament.

“The time is ripe. The people are waiting for this huge reform,” he said.

“This legislation in our estimation works clearly for the benefit of citizens and creates significant economies of scale in the delivery of services.”

Asked about the reduction in per capita costs for residents based on the new data, Nouris said a study showed that the cost of services per capita per year could be as much as five times lower than they are today due the economies of scale involved.

For example, he added, people living in a smaller municipalities today might be charged as much as €1,143 in yearly taxes and fees for specific services but the study showed that by joining with a larger local authority, this could be reduced to €245 a year, the average cost in the bigger local authorities.

“The benefits will clearly be passed on to citizens either through tax reductions or other means,” Nouris said.

Seventeen new municipalities will be formed from the planned merger of the existing 30: four in Nicosia, four in Limassol, four in Larnaca, three in Paphos and two in Famagusta.

Thirty municipalities and 48 communities will be merged, which means 83 per cent of the population, 700,000 residents, will now be part of a municipality, compared with 71 per cent currently.

Nouris said that the new bill would create financially viable and administratively independent units. They would also be required to present balanced budgets and face consequences if they did not. The bill would also reduce staff costs to 40 per cent or 45 per cent of total budget whereas currently in some cases, staff costs account for 65 per cent or more of the annual budget.

The minister said he has a number of meetings lined up in the coming weeks with local authorities and with the Union of Municipalities.
“Cooperation and understanding is excellent and above all we have exactly the same goal of moving forward with this great reform effort,” Nouris said.

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Source: Cyprus News Agency