Massive hole reported in CyBC pension fund

A deficit of €105 million in the Cyprus Broadcasting Corporation’s (CyBC) employee pension fund calls for immediate action as it poses a dire risk to its very viability, the Auditor General’s annual report said.
The House Oversight committee convened on Tuesday to discuss the report’s findings.
“The situation is dramatic,” CyBC’s head Yiorgos Tsalakos told lawmakers. “Each year about €6.5 million is needed for pension payments alone.”
The pensions of 409 CyBC retirees are covered by the fund, the cumulative deficit of which recorded a spike of €12 million in a single year – from €93 million in 2012 to €105 million in 2013.
Save for a dramatic intervention – like one heard during the session, that the government foot the bill for the broadcaster’s pension payments – the fund is expected to remain viable only until the end of 2015.
Sensing danger, employee unions were quick to pin the fund’s financial predicament on several investments that subsequently went bad.
“Among the Fund’s assets are included significant amounts in deposits, shares and bonds of the Bank of Cyprus and Popular Bank, which lost significant value, thus raising the fund’s deficit,” read the Auditor General’s report.
The report includes a host of irregularities where procedure was not so much circumvented as blatantly ignored, as in the case of 21 correspondents and cameramen whose contracts expired in 2013 and were never renewed, but they continue to work – and be paid – as normal.
But even though the broadcaster relies almost exclusively on annual handouts from the government – over €26 million in 2013 – it appears unable to secure even meagre revenue streams from advertising.
“Considering that total revenues from advertising was €2.1 million, and given that provisions for doubtful debts was €1.03 – a percentage of 47.7 per cent – it emerges that there exists particularly high risk from the inability to collect dues by the Broadcaster, as well as a form of indirect financing of its customers,” Michaelides’ report noted.

The Cyprus Mail is the only English-language daily newspaper published in Cyprus. It was established in 1945 and today, with its popular and widely-read website, the Cyprus Mail is among the most trusted news sites in Cyprus. The newspaper is not affiliated with any political parties and has always striven to maintain its independence. Over the past 70-plus years, the Cyprus Mail, with a small dedicated team, has covered momentous events in Cyprus’ modern history, chronicling the last gasps of British colonial rule, Cyprus’ truncated independence, the coup and Turkish invasion, and the decades of negotiations to stitch the divided island back together, plus a myriad of scandals, murders, and human interests stories that capture the island and its -people. Observers describe it as politically conservative.