A damning audit has revealed profound and systemic failures in financial management within Cyprus’s Ministry of Transport, casting serious doubt on the state’s ability to safeguard public funds. The report, issued by the nation’s Audit Office, delineates a pattern of inadequate controls, procedural negligence, and accounting disarray spanning several years. These deficiencies have left the government unable to quantify its financial liabilities, exposed it to multi-million-euro lawsuits, and resulted in confirmed overpayments to contractors and overcharges levied on citizens.
The comprehensive audit scrutinized operations for the 2022-2023 period but traced the roots of current crises to public transport concession contracts initiated as far back as 2010. These agreements, collectively worth hundreds of millions of euros across districts including Nicosia, Limassol, Larnaca, and Paphos, were intended to structure the nation’s bus services. However, the audit found that oversight of these substantial financial commitments has been critically lax for over a decade, establishing a foundation for the present turmoil.
Among the most pressing consequences is a litigious standoff with five public transport operators, who have initiated legal proceedings claiming more than €59 million in compensation related to disputes arising from the 2010-2020 contracts. Compounding this, the audit discovered that for subsequent contracts active between 2020 and 2022, concessionaires routinely failed to submit mandatory quarterly financial statements. When they did, the ministry applied stipulated financial penalties inconsistently, undermining contractual enforcement and accountability.
Internally, the ministry’s controls were found to be alarmingly weak. A glaring breach of fundamental accounting principles was identified, whereby a solitary official was entrusted with the full cycle of calculating sums owed to contractors, verifying their accuracy, and authorizing payments. This collapse of the essential separation of duties creates a high risk for error and fraud. Furthermore, due to profoundly deficient bookkeeping, the state cannot ascertain the full scope of its potential financial exposure, raising questions about the reliability of its official accounts.
The financial hemorrhage extends beyond high-value contracts to individual citizens. A flaw in the Road Transport Department’s vehicle registration software, known as TOMIS, has systematically overcharged drivers for late renewals. The system erroneously calculates a 10% penalty based on a full annual fee, even for drivers renewing for shorter periods, such as six months. While an individual overcharge may seem modest—one cited instance was €9—the aggregate sum unlawfully collected from the public remains unknown and unaddressed.
The implications of these findings are severe. They point to a culture of operational negligence that jeopardizes the integrity of public financial management. The state faces not only substantial unresolved liabilities but also a fundamental crisis of confidence in its administrative competence. The Audit Office’s report necessitates urgent and comprehensive reform, demanding robust internal audits, stringent enforcement of contractual terms, and a complete overhaul of financial controls within the ministry to prevent further dissipation of taxpayer funds.