AKEL proposals for the modernization of Semi-governmental Organizations

AKEL C.C. Press Office, 19^th May 2016, Nicosia

The modernization of the Semi-governmental organizations must have as its goal the creation of public utility organizations that will support a public strategy for growth. At the same time, these Organizations should be models as far as their organization and working conditions are concerned, capable of coping with the increased competition.

These Organizations are the property and investment which belong to Cypriot citizens. Their future cannot be their selling off to private interests. The privatization of these organizations will damage the interests of Cypriot citizens. Their property will be sold off for next to nothing and their social role will change. The Cypriot citizen is facing the danger of private oligopolies and monopolies. The most likely development is that the private owner will seek to gain as much profit as possible; profit that will not be channeled back towards growth and development but for the payment of the purchasing price.

With the changes we are seeking the following must be ensured:

• The public nature and character of the organizations
• The employment status of workers in the Organization
• The developmental character of the Organizations for the economy
• Deepening the nature of the organizations geared to people’s interests

Proposals concerning the management and control of Semi-governmental organizations:

Appointment of Boards

• Participation of executives and workers in the Boards of the organizations with the right to vote
• Election of two members of the board by the workers by direct election. Possibility of withdrawing these two members with the consent of 60% of working people
• Control of Board members concerning any conflict of interest and the possibility of their removal

Internal control

The goal is the strengthening and independence of the internal control mechanisms in line with modern standards.

• Adoption by public utility organizations of a modern code of good governance so that their operation becomes more transparent and effective.
• Strengthening of existing and operation of new committees by the Board members for controlling the functioning of the organizations – Emphasis in the functioning of an audit committee and the creation of an internal audit department.
• Obligation of the Board to prepare an annual progress report with content related to the progress of the organization not only with regards financial results, but also on issues regarding corporate governance issues, the enhancement of internal auditing and the combating of corruption.
• Functioning of a tender committee functioning within the framework of the relevant legislation and principles of good governance.
• Review of unwanted privileges or/and distortions in the functioning of the organizations.
• Initiation of the legislative framework for the “Wealth Declaration” in a respective and corresponding way with the public service.

Proposals relating to the operation of the Organizations:

Function and Flexibility

• Planning of the vision and strategy of these organizations based on public interest and the interests of consumers.
• Increased autonomy of the Organizations with the implementation of speedy approval procedures of the budgets in the House of Representatives.
• Observance of performance and liquidity indicators to ensure the robustness of the organizations.
• Preparation of an action report by the Board on the development program of the Organization.
• Obligation to carry out feasibility studies for large scale development projects.
• Obligation of the organizations to measure through the use of quantitative surveys the satisfaction of their customers or/and the public by setting improvement targets

 

Personnel

• Code of conduct and sound management that should cover all executives and workers of the organizations. Improvement of the Disciplinary Regulation with severe penalties for the prevention of interwoven interests and corruption.
• Designation of a limit in the terms of office regarding the positions of senior executive board members, with the reservation that the limit must not exceed the retirement age. Definition of limits in terms and interchangeability in the highest levels of the management/administration.
• Study on the way of hiring and appointment to the highest levels of the organizations so that the individuals should have the administrative and strategic capacity for the development of the organization. Holding of exams for hiring personnel by independent bodies.
• For the hiring of personnel for specialized positions interviews should be conducted by the management team and not by the Board.
• Introduction of proper staff evaluation procedures.
• The permanent training of personnel should be established.
• Reexamination and abolishment of practices and privileges which today are considered excessive or provocative.

Funding and distribution of profits

• Ensuring the contribution of profits to the Consolidated Fund of the Republic.
• Investing a concrete amount of the profits for the development of infrastructure.
• Obligation to create a reserve fund for the sustainability of the organizations.