By Stelios Orphanides
With its decision to march to the presidential palace to protest a cabinet decision to allocate more money to compensate members of provident funds for deposits losses in 2013 bank union Etyk appears to ignore past favours, Finance Minister Harris Georgiades said.
“Etyk’s protest does not seem to take into account what the state has done in favour of its members,” the minister said in an emailed statement on Tuesday. “Almost all 60,000 members of provident funds, including 4,500 bank workers, earn 75 per cent while 1,000 other workers at Bank of Cyprus who secured amounts in excess of €100,000 maintain the prospect of additional recompense by the bank”.
In 2013, the government made €300m available to compensate members of funds for deposits lost in the bail-in and in July 2017 made another €168m available to increase the recoupment to 75 per cent of losses per member or up to €100,000.
On Thursday, the council of ministers decided to allocate an additional €20m by relaxing the criteria for provident fund members who have meanwhile left Bank of Cyprus. The lender offered to compensate its workers for their losses in exchange for an agreement on a new remuneration system.
Provident funds lost approximately 70 per cent of the €1.1bn they held in deposits at Cypriot banks in defiance of repeated supervisory warnings to avoid risk concentration.
“The above arrangements, finalised by the cabinet and implying a significant burden to the budget, fulfil the state’s commitments and at the same time ensure basic social justice,” he said. “Let me remind that thanks to the government’s efforts, no bank worker was fired even after banks went down, contrary to what happened with many other fellow citizens working for the private sector”.
Several parties, including Diko, Edek, Solidarity and the Environmentalists expressed their support to Etyk’s position.