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The government has finally announced a set of measures to protect state finances from spiraling into a higher deficit and to safeguard the economy from a potential meltdown. However, these measures will do little to inspire consumers to spend more, nor do they suggest effective ways to fast-track the long-delayed public infrastructure projects.
The Christofias administration has opted to appease the concerns of a section of voters by not suggesting any cuts in the civil service, despite calls by critics to drastically reduce the bloated civil service. On the other hand, despite its calling to protect workers’ rights, the government has neglected half the island’s workforce, namely the private sector employees who are the ones affected by the crisis through redundancies and pay freezes, a privilege that no civil servant is prepared to give up.
It is ironic that the president and his cabinet acknowledge that there are delays, due mainly to red tape, to get public projects going again, or at least speeded up to ensure that construction workers remain fully employed who will in turn inject their hard-earned euros back into the economy. Yet, the state leadership cannot get civil servants to speed up procedures to build marinas, roads and schools.
This government is also misguided if it thinks that improved tax collection alone will contribute the billions necessary to keep the public payroll afloat. After all, better collection methods (and harsher fines) are necessary to ensure that taxes are not lost and Inland Revenue should consider investigating many cases of tax dodgers, despite the risk of upsetting a handful of crooked lawyers and accountants.
Now is the time for the government to invest more in quality infrastructure, cheaper transport, higher standards of education, research and science. Cyprus will never be taken seriously if it cannot embrace new technology and it will never be regarded a potential centre of higher education if it does not adopt knowledge society as its main principle for future development.
Money spent on research grants and scientific programmes is guaranteed to pay off by generating future incomes and by encouraging professionals and scientists to relocate to Cyprus. More funds directed to start-ups and SMEs will also help recycle the island’s labour force with small companies incentivised to hire more that will also alleviate the problem of growing unemployment. Minister should encourage more of these schemes, such as direct aid and low-interest loans to women entrepreneurs, encouraging eco-friendly and energy saving systems, while urging companies and public organisations to increase their Web presence and adopt e-commerce and e-government with greater confidence. Otherwise they will have the same fate as the underutilised Energy Fund incentives that hardly anyone ever hears about, yet on paper they seem to be convincing that something is being done.
