Municipalities need €14 million in emergency financial assistance

Municipalities are in need of a total of €14 million in emergency financial assistance, Larnaca Mayor and Municipalities’ Union chairman Andreas Vyras said on Wednesday.

Speaking to the Municipalities’ Union’s annual general meeting, Vyras said external factors have had a negative impact on municipalities’ funds in recent years.

These internal factors, he said, include the war in Ukraine and the pandemic.

He added, “today, we are facing the risk of submitting a budget deficit for the financial year 2023-24.”

He said that for this reason, the municipalities have requested extraordinary financial assistance from the interior ministry, which have since been passed on to the finance ministry.

Speaking of the issues faced by municipalities, he said “personnel costs have increased by five per cent and operating costs are projected to increase by 15 per cent in the current fiscal year.”

“At the same time, we are facing serious losses in fiscal revenue due to the wider economic crisis, but also a 30 per cent increase in the costs of construction projects, which we have binding obligations to carry out,” he added.

He said, “we are not taking financial risks, but the problems are there and they exist.”

In addition, he spoke about the ongoing local government reforms, saying “while the legislation that was passed may not be fully satisfactory and there are still serious issues that need to be studied and are deeply troubling, an important step forward has been made.”

“With all its weaknesses, the new system of local government is better than the old one, which has long been past its sell by date,” he added.

He said Cypriot local government “is on the brink of a historic transition with these reforms,” and added “we will cope with the challenges we face in the best possible way.”

Speaking regarding local government initiatives in recent years, he said the Municipalities’ Union “helped both the state and ordinary people in the management of the unprecedented Covid-19 pandemic.”

In addition, he said the union had “moved gender equality from simple statements to substantial actions, managed through actions to bring local government closer to the youth, focused on the training of local government workers, breathed new life into the outward-facing nature of the union and by extension local government in Cyprus, and took decisive steps in the direction of the green and digital transition.”

To this end, he spoke of the “Evagoras” information system, which he said will allow digital local government services to “smoothly connect” with other government services.

He said the system will be piloted from January and called on those involved to “cooperate and actively contribute at all stages to identify weaknesses in time and to properly train the staff who will use the system.”