By George Psyllides
PARLIAMENT is expected to approve the state budget by majority vote on Tuesday after former government partner DIKO said it will vote in favour, despite slamming the government’s economic policy.
“Conscious of its responsibility towards the country and our people, and taking into account that any default in payments would not solve our problems but make them worse, the Democratic Party (DIKO) will vote in favour of the 2015 budget,” party chairman Nicolas Papadopoulos said in his speech in parliament.
Papadopoulos, who led his party to abandon the government coalition early this year, has since become a vociferous critic of government economic policy.
“What is important to us is the stability and credibility of our state,” he said. “However, this does not mean we agree with the philosophy of the budget.”
The DIKO leader said the draft was not a “stabilisation budget” as the finance minister had described it in his speech. “We see that it is a budget of stagnation.”
He agreed with the finance minister that growth with borrowed money was not real growth and the island should never go back to excessive borrowing, profligacy, and loss of credibility.
“We agree that borrowing is not the solution. But what solution is the current government proposing for the development of the Cypriot economy?” he asked.
Papadopoulos charged that Cyprus has not seen any investment and there were no incentives for growth.
Public sector reforms were also nowhere to be seen, he said.
He said DIKO’s philosophy was that Cyprus must ask for changes to the bailout terms and towards this the party has opened a dialogue with other parties to draft a national negotiation framework with the island’s minimum demands.
Ruling DISY leader Averof Neophytou sought to reach out to scandal-weary voters, saying his party was ready to clash with the establishment.
“We are in the front line in the battle with the establishment and the mentality of bygone eras,” Neophytou said. “We are ready to shoulder any political cost as long as we secure our country’s future and prospects.”
Neophytou said the 2015 budget would keep Cyprus on the course of restoring its credibility “provided we carry on with the reforms without wavering”.
However, Neophytou acknowledged that the problems of the real economy continued and at the same time institutions were called into question.
“There is total distrust towards the political system. With the bell tolling loudly for everyone, anyone pretending they cannot hear it is committing a crime by turning a blind eye,” he said.
Neophytou said Cyprus should come out of the crisis not only with a better state and a credible economy but also with a democracy of better quality.
“It is now the moment we turned the page. From managing the crisis, which almost destroyed the country, it is the time to enter the new era of creation.”
Averof recognised that his party had also made mistakes but the decision was to rectify them.
“For us, the path of radical change is a one way street. Growth, the country’s strategic direction for tomorrow, is not the job of the (bailout) memorandum. It is our job, the Cypriots’.”
Main opposition AKEL said it will vote against the budget because it only included implementation of the anti-popular objectives of the international lenders and the government.
Andros Kyprianou, the leader of the party that sought the bailout in 2012, called on the government to stop mocking the people with PR spiel.
“The practical relevance are the 66,000 jobless. The thousands of small and medium businesses that closed and those on the brink; 13,000 pupils expecting food from school; 12,500 families who did not celebrate Christmas last year and will not do so this year either,” Kyprianou said.
“And worse of all, there is no effort to assess the effects of the austerity measures on society.”
Kyprianou said the drop in disposable income and the effect of austerity on expectations have led to a significant drop in public and private investment.
“The lack of adequate tools for growth and the insecure production basis show that the prospects for the future are limited.”
Nominally socialists EDEK will also vote against the budget except for defence expenditure.
MP Giorgos Varnava said the party will reject the draft, emphasising the need for resistance to international lenders.
“Our only exit from the economic recession is not the faithful implementation of austerity measures but the course to economic and social growth,” Varnava said,
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