The fate of local government reform could hang in the balance this week, as MPs weigh the disparate demands and objections coming from several communities – and this amid fresh warnings that Cyprus stands to lose out on major EU funds unless it passes the relevant legislation by year’s end.

The local government reform project envisages the creation of 17 greater municipalities through mergers of existing ones, plus a fusion of some 300 smaller communities into 33 clusters.

The project’s stated aim is to create economies of scale through a clustering of municipalities and local communities that can stand on their own feet financially.

But during a discussion of the related bills in parliament on Monday, it emerged that the House interior committee has received at least 120 letters from communities disagreeing in one way or another to the configuration proposed by the government.

Moreover, the parliamentary parties themselves have ideas of their own and intend to draft amendments to the government bills – meaning that the final configuration of municipalities and communities could go down to the wire on the day of the vote at the House plenum.

Aristos Damianou, Akel MP and chair of the interior committee, cited objections from the Union of Cyprus Communities, which argues that the proposed clustering would “weaken” a number of communities.

The union said in a letter that, under the blueprint as it stands, roughly half of the population in rural areas would end up being re-designated as living in urban areas. It has also demanded that residents of communities opposed to mergers be allowed to put the matter to a vote in local referendums.

Lawmakers want to take the bills to the House plenum before the year closes. To this end, Damianou has proposed that a special session of the plenary be held on December 20, after the session that will vote on the 2022 state budget.

Normally the plenary session voting on the state budget is the last of the calendar year, after which the legislature goes into recess for the season holidays.

Meantime MPs have received another missive from Interior Minister Nicos Nouris reiterating that further disbursement of EU funds is contingent on Cyprus enacting the reform bills before the end of the year.

Racing against time, the House committee will hold another session on Thursday.

It appears that a consensus is shaping relating to the merger of municipalities – with the main sticking point now being the smaller communities.

Media reports suggested that the least resistance is coming from Nicosia district, where 93 communities will be fused into nine clusters.

In Larnaca, the proposal is for creating six clusters from the 35 communities; in Limassol eight clusters from 89 communities; and in Paphos ten clusters from 80 communities.