New position of Audit Service on the subject of the concession agreement for the Development and Management of Larnaca and Paphos Airports – Complaint by the Audit Service to the European Commission for illegal direct assignment by the Ministry of Finance – Spikes also against the Attorney General – “The accused are turning into accusers”
The Control Service is again in the spotlight on the subject of the concession agreement for Development and Management of Larnaca and Paphos Airports, which is preparing a complaint to the European Commission for illegal direct assignment by the Ministry of Finance.
The General Auditor< /strong>insists that the Ministry of Finance is lying about securing credits before signing the two contracts for the concession agreement for the development and management of Larnaca and Paphos airports.
In his statement he even mentions that in Cyprus the accused are turned into accusers on the basis of baseless complaints which constitute a “smoke screen and disorientation”. At the same time, he indicates that the Attorney General is unable to objectively examine the issue and for this reason he will present the evidence before the European Commission.
- Ulysses for airport contracts: Ridiculous and Ministry of Finance complaints are unfounded
As stated in an announcement by the Audit Service, following the publication of the Phileleftheros newspaper on 21.1.2023, in which excerpts from a letter dated 19.1.2023 of the Ministry of Finance to the Attorney General, today the entire letter has been posted on the Stockwatch website. “Although in the letter”, the Audit Service states, “it is written that our Service is included among its recipients, we have not yet received it. In any case, three important issues arise from it, which we consider necessary to comment on. >we informed the Attorney General about the possibility of committing criminal or civil offenses in relation to the conclusion by the Ministry of Finance of two contracts with financial advisers,one in November 2021 and one in July 2022, without the existence of available credits and by direct award, without the announcement of an open tender, in violation of the relevant public procurement legislation. The relevant decisions were taken by the Minister of Finance and the Director General of his Ministry”.
“From the letter of the Ministry of Finance dated 19.1.2023”, reports the Audit Service, “it appears that the Ministry secured in October 2022, i.e. after we highlighted for the first time the issue of the illegal direct award of the two contracts, an opinion by the Attorney General of the Republic that the direct assignment was legal“.
Already in our letter dated 2.1.2023, the announcement continues, “we have recorded allegations from the Ministry of Finance that even during the essential time of concluding the two contracts, they had the consent of the Attorney General for this direct assignment. In fact, this is also included in a joint statement of the Ministries of Finance and Transport dated 27.9.2022″.
He adds that “What is confirmed by the letter from the Ministry of Finance is that the Attorney General is called upon to examine possible criminal offenses by the decision-makers of the Ministry of Finance who, however, acted on the basis of his own guidance and/or his own cover-up. The documentation of the illegality of the direct assignment is listed in paragraph 3 of our letter dated 2.1.2023 which is published today”.
“Because apparently the Attorney General cannot objectively examine the matterand because the second award of €191,238 concerns a public contract that, based on the relevant legislation, should, due to its amount, have been announced at the European level, we will forward a relevant complaint to the European Commission for the illegal direct award“, the Auditor General points out.
In the second point of the announcement it is stated that “in the letter dated 19.1.2023 the Ministry of Finance is lyingregarding the securing of credits before the signing of the two contracts” adding that “It is an indisputable fact that the Ministry of Finance signed two service contracts, the first (on 18.11.2021) with the audit firm Ernst Young worth €80,000 and the second ( date 14.7.2022) with the audit firm PwC worth €191,238, without having previously secured the available credits. Specifically, the two contracts were signed while the necessary credits were reserved in the State Budget. In the first case, the request for release was submitted to the relevant Parliamentary Finance and Budget Committee retrospectively on 1.12.2021 and the relevant approval was given by the Committee on 7.12.2021. In the second case, the request for release was submitted retrospectively on 8.9.2022 and was never approved by the aforementioned Committee. The Ministry of Finance in neither of the two cases informed the aforementioned Committee that the contracts for which he requested the release of credits had already been signed”.
“The fact that, as the Ministry of Finance informs us, PwC has decided not to request its accruals, does not correct the problem but makes it even more serious”, he indicates.
On the third point herannouncement states that, “the Ministry of Finance is complaining to us because in the briefing we gave orally to the Parliamentary Finance and Budget Committee we deemed it appropriate to mention to them that any amendment to a public contract by definition entails risks for corruption issues, which risks increase the greater the amendment. In this case, the amendment with the management company concerns the direct assignment of work with gross revenues of €1.5 billion. The size is colossal. We also considered it appropriate to inform the Commission, so that it would have a complete picture, that an executive of Hermes had admitted in 2015 in the SAPA scandal that he had given kickbacks and that a draft of our report to the Ministry of Transport had been communicated by them to Hermes without this being foreseen in the procedure. We emphasized that in no way do we accuse the company or its officers or anyone else of corruption, but that, as auditors, we must always, when conducting an audit, adequately assess the risks that exist to take them into account when planning and conducting the audit.” .
He adds that “The Ministry of Finance is therefore reporting us because we informed the competent Committee about these issues, which had itself voluntarily requested information from us. The Ministry of Finance considers it a fault that we informed the Commission about the unacceptable and onerous agreement they were launching”. confidential document, we have already commented on them in our announcement dated 21.1.2023″.
He adds that, “only that, from their letter dated 19.1.2023 that we are now reading, it seems that this non-existent complaint against us only concerns events of September 2022 and not any later event. So one wonders why this was not submitted then but two weeks after our own complaint. Apparently for the reasons we've already explained: “The accused are turning into accusers” on the basis of baseless allegations that are a “smokescreen and distraction,” the statement concludes.
