COMMERCE & Tourism Minister Antonis Paschalides would “have no problem” taking a pay-cut “for the greater good” and to set a good example over public sector pay, he said yesterday.
Asked to comment on the package of public sector cutbacks – including pay-cuts for high earners – being prepared by Finance Minister Charilaos Stavrakis for announcement within the next two weeks, Paschalides said: “Of course, I have no problem. Not just we (senior public servants), but many other high-earners in Cyprus need to set a good example, and I would happily accept a pay-cut.”
The Minister added: “We need to look to the greater good, and see the forest rather than the trees, not just temporary gain. This is something that, unfortunately, we in Cyprus have been putting into practice for decades: temporary gain, the bigger and faster the better, the so-called ‘grab what you can’.”
The proposed cutbacks are part of an action plan being put together by the Finance Ministry in a bid to plug a growing gap in state revenues – the latest official figures for 2009 referred to €576 million – and reining in a spiralling budget deficit, which is already set to reach around 6 per cent of GDP this year.
The 2010 budget gives an exhaustive list of all the salaries, benefits and allowances payable to government officials and civil servants.
Starting at the top, President Demetris Christofias will receive €100,793 in basic salary. Government Spokesman Stefanos Stefanou will receive €64,835 basic salary, plus €33,065 in “Representation Allowance”. Presidential Commissioner George Iacovou will also get €64,835 basic salary. The total basic salary bill – excluding benefits and allowances – for the Council of Ministers comes to €848,220, which works out at €77,111 per head.
As President of the House of Representatives, Marios Garoyian will receive €81,500 in basic salary. Each of the 55 members of the House of Representatives will receive €31,793 in basic salary, plus €22,926 in expense allowances and a further €12,301.93 to cover secretarial services.
The highest-paid civil servants are the Permanent Secretaries, who are in charge of administering the ministries, and who will each receive €70,685 in basic salary.
The above figures are only partial, not taking into account “Position Allowances” (expenses), thirteenth salaries, the Cost of Living Allowance and other allowances covering things such as cars, etc.
The problem of the enormous state payroll – which at €2.24 billion accounts for around a third of the state budget – was highlighted by the International Monetary Fund (IMF) Consultation Mission to Cyprus in June 2009.
Speaking to the House Finance Committee last November, Central Bank Governor Athanasios Orphanides had described the country’s economic situation as “critical”, and called for cuts in public spending, structural economic change and better long-term planning.
Stavrakis has taken great pains over recent months to involve senior representatives of the main political parties, the trade unions and employers’ organisations in his plans for reducing the budget deficit. This process resulted in a public acknowledgement by the major parties at the end of November that there was a long-term structural problem with public finances, which had to be finally tackled.
Paschalides said yesterday: “There is no future in grabbing what you can. I hope that everyone in Cyprus has understood this, and everyone – employers, employees and the self-employed – should take responsible decisions for themselves, their companies and for the Cypriot economy.”
