The Court of Auditors puts a tombstone on the privatisation of municipalities

With a landmark decision, the Court of Auditors and in particular its Seventh (VII) Section, puts a brake on the privatisation overnight of key -neural services of the municipalities.

Specifically, the Seventh (VII) Department of the Court of Auditors, ruled with its decision No.: 917/2021, illegal the assignment of the entire financial services of the Municipality of Chersonissos to the ’Development Agency EVDIMOS« through a Programmatic Contract.

The rationale

The Court of Auditors, among other things, accepting the objections of the P.O.E.-O.T.A., considered that the contract in question «does not constitute a case of a permissible Programme Contract», as «EYDIMOS S.A.» cannot carry out the project by its own means since it does not have the necessary staff and will necessarily recruit staff without following a competitive procedure.

At the same time, and this is the most important finding of the Court of Auditors, it found that, «it is not possible to delegate decisive powers to the Development Agencies, when the object of the programme contracts is the exercise of the responsibilities of key services of local government, relating to one of their basic and primary functions, such as the financial services of the local authorities».

This was preceded by the relevant act of the Deputy Commissioner of the Court of Auditors in the 2nd Service of the Commissioner of the Heraklion Regional Unit, which had ruled that the signing of the said Programme Contract was blocked for reasons related to its legality.

Both in the proceedings before the Commissioner and in the proceedings before the Court of Auditors, the P.O.E.-O.T.A. had legitimately intervened, stressing that it was not a real Programme Contract-Cooperation between two local government bodies, but a normal service contract, without compliance with the legal requirements.

In a statement, the PDO-OTA characterizes the decision «vindication and significant victory», and stresses:

«We welcome the decision of the Court of Auditors, whose pivotal role as an instrument of preventive and repressive control we have long supported, believing that only through strict and thorough control can cases of waste of public money and distortion of the rules governing Local Authorities (LAs) be addressed.

The P.O.E.-O.T.A. defends and will continue to defend the public and social character of the services of the Local Authorities (O.T.A.), for the benefit not only of the employees of the Municipalities but also of the citizens, who are asked to pay the cost of the transfer of competences and services to third parties.
It prioritises the need to recruit staff and improve the logistical infrastructure over the payment of «inflated» bills to third parties, who prey on the local government sector.

Municipal Services is not a field for the development of business activity of any kind. It is a field of offer to the citizen, protection of public goods and protection of the public interest »underlines , concluding the announcement of .