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State is way behind on building payments

Contractors have accused the Cyprus government of deliberately delaying inspections of works to delay payments; some of them have been owed money since 2008 and the amounts are very high.

Cyprus government accused of payment delays
BUILDING contractors are due a reported €200 million in repayments for jobs carried out for the state, with some reporting deliberate delays in inspecting the work in order to postpone payment further.

According to the head of the Federation of Associations of Building Contractors Cyprus (OSEOK), Nicos Kelepeshis, these delays have been taking place for a long time.

“The truth is we have been facing delays from the various authorities for a while now,” Kelepeshis told state broadcaster CyBC. “This isn’t something new; we are talking about final payments and settling of bills for work that was carried out and passed through the inspections, and for which an order was issued for payment.”

Money owed since 2008

He added, “We have examples that have taken years”.

Kelepeshis said things got much worse with the economic crisis. “We have money owed from 2008 until 2011, with the amounts being very high.”

In addition, contractors are also owed a lot of money in claims.

Asked to comment on reports that inspectors were given orders to delay checks so as to delay payments, Kelepeshis said: “We have such information, yes. It is clear that EU directives and the new law are being violated, concerning payment by the public sector to third parties. The 30 days that are provided by law (for settling public sector bills) have been surpassed for a while now, as have the 60 and 65 days. Now we are seeing 90 to 120 days, for a finished job to be paid for.”

Readers' comments

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  • Jill says:

    Oh what a tangled web we weave!!!!! Suddenly the developers are claiming non-payment by the Government!! And they’re crying!!! It goes full circle doesn’t it? No Title Deeds because the Developers don’t complete sites and therefore don’t pay taxes to the Government, the Developers haven’t repaid mortgages to the Banks, so people’s homes are being taken by the Banks, and the Government which has allowed all this to continue, are not paying the developers. Well, what next?

  • MARTYN says:

    Nothing at all surprising in this, simply fits the overall picture of a precarious overall Cyprus economic/financial mess, in some fundamental ways not dissimilar to that in the UK in 2007-10 I.e.: overseen by a very weak government and President who seems content just to try and muddle through – in Cyprus’ case until his EC & Cyprus Presidencies come to an end by early next year. Others will then have to try and sort it all out over the next 5/10 years.

    But at least the Troika are involved now, they may well precipitate much stronger action!

  • Peter G Davis says:

    I paid over €1,800 in IPT to my developer for the 10 years I’ve been waiting for my title deeds, and submitted a claim for 6 years (maximum allowed) and have been informed that the claims are only dealt with in blocks of 600.

    Then they said they were examining my contact to see if I needed to re-pay my developer.

    Truth is I don’t expect to see any of this money it will just be kept by the Government. Any excuse will do.

  • Mike says:

    Since when has Cyprus heeded or complied with any EU directive, or law for that matter, except the law for Speeding on the Highway. EU directives and legislation seem to be viewed as matters that apply to other EU states but most definitely not Cyprus as we are a “special case with special considerations”. We are after all a “Country of sensitivities” – that nobody else seems to be capable of understanding. Non payment for public works is possibly just another ‘special consideration’ as a result of the ‘sensitivities’ within the economy or what’s left of it!

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