The Republic of Cyprus is still a “very centralised country”, a report adopted on Wednesday by the Council of Europe’s Congress of Local and Regional Authorities says, noting “too little progress” in promoting local democracy in the country.
The report also mentions ongoing efforts to reform local government in Cyprus, saying that if the reform is eventually approved, it should increase local self-government and enhance the governance of local authorities.
The Congress of Local and Regional Authorities adopted a report on Cyprus’ application of the European Charter of Local Self-Government and concluded that shortcomings persist since its previous report in 2016.
According to a Council of Europe announcement, the principle of self-government remains unrecognised, either in the Constitution or in applicable laws.
Furthermore, current monitoring points out that the sphere of responsibility of local authorities remains limited when compared with common European standards and the report stresses that financial needs for local authorities depend too much on State transfers and grants.
It is noted that Finance Ministry officials interviewed for this report concede that “many” Cypriot local authorities, especially smaller communities, cannot meet the needs of the population, and they face “considerable financial problems”. In summary, they recognised the lack of financial autonomy for local authorities, it is added.
On the other hand, the Congress appreciates a “frank will” from national authorities to react adequately to its recommendations.
The government has worked out a “comprehensive reform of local government”, according to the report, which highlights developments with the relevant legislative projects which did not secure approval by the House of Representatives before the May 2021 parliamentary elections.
“If eventually approved, this reform should increase local self-government and enhance the governance of local authorities. A radical reorganisation of the local government structures is also envisaged, through the compulsory mergers of all existing municipalities, reducing their number roughly by half. Many communities are also included in this operation,” the announcement says.
The planned reform would also significantly increase the competences and responsibilities of the Cypriot local authorities, as well as their financial basis. Moreover, if approved, several checks over local authorities, discharged so far by central government ministries, would be removed, it is added.
Recommendations from the monitoring report include introducing and recognising the principle of local self-government in the applicable laws governing the municipalities and the communities, while entrenching municipal tasks in the law and clarifying the distribution of municipal competences that should be increased, by revising relevant sectorial legislation, in particular on matters such as urban development planning or social services.
Cyprus, according to the recommendations, should expand municipal taxing capacity by increasing the share of resources coming from local taxes. This would strengthen the financial autonomy of the municipalities and reduce dependency on transfers provided by the central government.
The country should also enshrine in the law the principle of adequacy of the local finances, so as to ensure that they are at any moment commensurate with the local responsibilities provided for by the law and set up the necessary legal rules or institutional mechanisms to ensure that there is a connection between the financial means of local authorities and their competences.
Cyprus is also called to establish an efficient financial equalisation system, aiming at the protection of financially weaker local authorities, and eliminate as far as possible prior administrative controls from central government over local authorities, especially on matters related with the management of their human resources, the approval of their budgets or the management of their own assets and properties.
The country ought to strengthen the capacity of local governments to manage, organise and plan their own human resources by allowing local authorities to regulate in their own discretion the conditions of service of their own employees (within the limits of the law), without prior approval by the Council of Ministers of their regulations in that domain, the recommendations conclude.