Stavrakis aims to save €250 million

THE GOVERNMENT aims to save €250 million in next year’s budget by reducing “non-productive expenses” by civil servants such as unnecessary overtime and trips, Finance Minister Charilaos Stavrakis announced yesterday.

“Government revenues are continually getting smaller, mainly due to a big drop in property sales (and a corresponding drop in Immovable Property Tax).

“In order to be able to maintain the policy reference-point for growth, and to implement the large programme of public works we have announced, it is very important for us to reduce non-productive spending such as overtime, foreign trips by government officials, inviting foreign experts to Cyprus, and the like.”

The targeted reductions in overtime will not apply to the police, customs officers or hospitals.

Stavrakis said that that “total government spending comes to around €7.3 billion, of which €3 billion is so-called ‘inelastic’ spending such as the state sector wage bill, interest payments and spending on pensions, which do not offer any margin for reduction”.

After deducting the €1 billion or so allocated to the programme of infrastructure projects, this leaves around €3 billion state expenditure relating to the general running of the public sector.

“Our aim is to make savings at least in the order of €250 million to cover the very ambitious infrastructure programme and social benefits,” he said.

The Minister also said that the government was “in excellent and continuous co-operation” with the leadership of civil service union PASYDY and thought that the civil servants as well as all the social partners, were behaving very responsibly in view of the challenges in 2010 and 2011 due to the world economic crisis.

He indicated that therefore he did not anticipate high wage increases for public employees in the coming two years.

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