Corporatisation of semi-gov’t organisations

The Minister of Finance, Michalis Sarris, announced earlier this week that a bill was being drafted to transform semi-government organisations into publicly owned companies.

Although privatisation of semi-government organisations is off the agenda, thanks to a communist-dominated coalition, the transfomation should allow the organisations more freedom.

Instead of acting like government ministries, with orders from above, they could act more independently. This is particularly important for the two profitable semi-government organisations now facing competition: the Cyprus Telecommunications Authority and the Electricity Authority of Cyprus.

One important change would be that the organisations would no longer have to get their budgets approved by parliament.

However, sceptics have unfortunately viewed this important move as just a cynical attempt to squeeze more money out of the profitable organisations.

In the past four years the government has regularly boosted its budget revenue by taking dividend payments from EAC and CyTA.