ANYONE TRYING to forecast what will come out of next Thursday’s parliamentary session on the economy was left staring into a crystal ball yesterday as parties and unions played hopscotch over the current package of measures.
Opposition party DISY appeared to backtrack on its demand for raising the retirement age to 65; the finance minister said he’d “try” and get legislation prepared for a second package of measures by next week, while public servants union PASYDY claimed it has never agreed to raise VAT to 17 per cent.
The latest developments have created even greater uncertainty among those watching Cyprus as to what exactly will happen next Thursday when six bills on fiscal consolidation tabled by government will go to the plenum for voting. Parliamentary debate will begin on Monday and continue until August 25.
The bills mostly entail tax changes to increase state revenue. The government has promised a second package of measures at a later date focusing more on curbing state expenditure.
Yesterday, DISY leader Nicos Anastassiades and his number two Averof Neophytou met with Finance Minister Kikis Kazamias for over two hours to discuss the economy’s woes.
After the meeting, the two sides stated they had a common understanding of the problems facing the economy.
The DISY officials told the minister they wanted to see the second package tabled along with the first next Thursday.
The right-wing party has been a fierce critic of the government’s economic policy, along with all other parties bar ruling AKEL, while regarding the Mari naval blast, DISY has called on President Demetris Christofias to step down.
Speaking after the meeting, Kazamias said it would be difficult to submit the second package of measures by next week.
“I will try to respond to the request submitted. I do not know if I will succeed or not, although I consider it very difficult,” he said, noting that he has called ministry officials back from holidays in country.
He added that what he definitely has to do by August 25 is convince the parties of the government’s “real intentions”.
Neophytou responded that there were six days until the plenum meets, during which there was ample time to table a second package of measures for fiscal consolidation “if the political will exists”.
He called on the ministry to work throughout the night if it must to prepare a second package by Thursday “to send a message to the markets, the rating agencies, the European institutions and the International Monetary Fund”.
The DISY deputy noted that last month, a meeting of party representatives and government chaired by Christofias decided unanimously certain measures “and at a later stage, the president overturned them and tabled different bills in parliament”.
“That’s why we repeat carefully so as not to make the climate worse, that we want legislation– words are not enough,” he said.
Asked what DISY will do if the minister fails to prepare a second package in time, Neophytou said DISY’s parliamentary group will meet on Tuesday to discuss such a scenario.
Anastassiades also met with teacher unions POED, OELMEK and OLTEK yesterday, launching a series of meetings that will continue next week when he will meet with the remaining unions, including PASYDY, PEO and SEK.
According to POED chairman, Philios Fylaktou, the unions were pleased with DISY’s apparent backtracking on the proposal to increase the retirement age to 65.
Asked to comment, Neophytou said this was never a concrete proposal but an idea put down on paper that requires further discussion. The proposal doing the rounds in the media was unconstitutional, he added.
Meanwhile PASYDY boss Glafcos Hadjipetrou was quoted by Stockwatch yesterday saying that his union had never agreed to the two per cent hike in VAT, bringing into doubt the unions supposed agreement on the current package of measures.
PASYDY will hold a secret ballot on Monday to decide on strike measures should parliament try to alter or add to the package.
Right-wing union SEK has already voiced its opposition to the VAT hike.
