articles | 28 April 2015

President assures of no plans to raise taxes or cut wages

The government does not plan to raise taxes or cut pensions and wages, President Nicos Anastasiades assured civil servants recently, noting however, that government spending, including payroll, could only increase at a reasonable pace.

Addressing the 52nd annual meeting of civil servants’ union PASYDY, Anastasiades recalled that his government refrained from implementing painful austerity measures, including slashing salaries and pensions, except for the 0.2% cut civil servants and teachers volunteered in order to keep 1,800 temporary workers and 650 teachers.

“Despite the fact that it went against the policies adopted across the European Union, that is continuous wage cuts, and slashing of pensions and benefits, we will continue to follow this prudent policy in the future, and in this context we will need to ensure that any increase of the government’s operating expenditure, including the state’s payroll, should be reasonable, reflecting the economy’s capabilities,” Anastasiades pointed out.

Such a policy is dictated by the decision to avoid tax hikes and salary cuts in future, he added.

Anastasiades reminded the recent lifting of the last restrictions in capital movement, the passing of insolvency legislation, the subsequent upgrades by rating agencies, as well as the current economic indices, which “allow us to be optimistic for the future”.

“We can now focus on structural reform, the completion of which will allow our country to return to real and lasting growth, without the risk of finding ourselves in the custody of others,” he said.

This served as little more than a preamble to his argument in favour of overhauling public service, the dire need for which he went on to defend.

“Civil servants are the real victims of a largely obsolete system of public administration, which does not allow them to take full advantage of their potential,” he said.

Anastasiades added that his reform programme includes the introduction of mobility – as opposed to mere secondment – in public service, “in a way that will allow civil servants to select the department they wish to work in, and our programme includes a promotion system that will introduce objective criteria that will promote excellence across public administration, without discrimination, and without political party identification”.

He assured all stakeholders that no reform will take place without dialogue with those directly concerned, whether educators, or healthcare professionals.

But, he added, reforming the state does not simply translate to reforming public administration, but includes simplifying business licensing and operation procedures, a new regulatory framework for tourism and other economic sectors, and electronic governance.

“It is in this context that the need to restructure departments and semi-state organisations will emerge, including amending or transferring tasks or jurisdictions,” he said.

In his speech, PASYDY head Glafcos Hadjipetrou said they will work to modernise public administration within the confines of legality, and lambasted politicians and the media for giving cover to the “real culprits of the crisis”.

“I believe it is undisputed by now that the origin of the crisis was the banking sector,” he said.

“Also undisputed is the fact that the previous government, instead of taking corrective measures in the banking sector, took cumulative measures against civil servants and retirees.”

He also referred to preliminary talks on reform of the public service, claiming that in private meetings with the “official side”, the union had repeatedly stressed that the public service is not a faceless system, nor asum of numbers, to be treated to academic theories.

“It is a living organism comprising people with entitlements, who rightfully look forward to their advancement and their career,” Hadjipetrou said.

“Therefore, any decision will need to respect the principle of legality.”

Source: Cyprus Mail

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