The Special Report of the Audit Service makes extensive reference to the status of public passenger bus transport contracts, highlighting chronic weaknesses that begin in the decade 2010–2020 and continue to affect the state to this day.
The six contracts of that period, covering all the provinces of the Republic of Cyprus, provided for the payment of a government contribution to the contractors, based on a specific methodology. However, during their implementation, serious disagreements arose regarding the method of calculating the contribution, which led to prolonged confrontations between the state and the providers and, ultimately, to legal appeals.
According to the Report, five of the six contractors for the period 2010–2020 have filed lawsuits against the state, claiming additional amounts of more than 59 million euros, in addition to those already paid. The claims concern financial disputes that have accumulated over a decade, with the contractors challenging the preliminary payments made to them based on decisions of the Dispute Resolution Committee. Despite the expiration of the specific contracts and the fact that a significant period of time has passed, the Department of Road Transport remains, as the Audit Service notes, unable to determine the potential total amount of the state's debts, which burdens fiscal planning and leaves a serious financial front open.
The Report also records weaknesses in the management of contracts by the Ministry of Transport, particularly in terms of payment control. Cases are identified where the same person simultaneously had a role in calculating compensation, checking its accuracy and in the decision-making process for payment of the amounts, which is contrary to the basic principles of separation of powers and increases the risk of errors or omissions.
Regarding the new contracts for the period 2020–2032, the Audit Service notes that, although these are "net cost" contracts that transfer greater business risk to the concessionaires, serious dysfunctions continue to occur in their monitoring. Contractors are required to submit quarterly progress reports and financial accounts, however, in many cases late, incomplete or even non-submission of data is recorded, without the timely imposition of the foreseen financial penalties by the Contracting Authority.
At the same time, the Audit Service points out that key performance indicators, designed to ensure the quality of public transport and allow for the imposition of sanctions in cases of non-compliance, are not systematically applied. As a result, the state is deprived of a crucial tool for control and protection of the public interest, while reinforcing the image of lax supervision in contracts worth hundreds of millions of euros.
Overall, the picture that the Report on public passenger transport contracts paints is that of a system that operates with structural weaknesses, limited control and significant delays in resolving past outstanding issues. The pending lawsuits of 59 million euros serve as the loudest warning of the possible consequences, highlighting the need for a substantial review of the management, control and supervision mechanisms of these contracts.
Source: sigmalive
