New era in Cyprus local governance begins with 20 new municipalities

Cyprus is undergoing a significant local government reform aimed at enhancing service quality, financial and administrative autonomy, and transparency. This reform is designed to address inefficiencies in the previous system and create more robust, economically viable, and flexible municipalities and communities.

The transition to the new local government structure is expected to face challenges, particularly in transferring responsibilities to provincial self-government organisations (EDAs). The reform process is ongoing, with further changes to municipal revenues and structures anticipated from September.

The reform aims to reduce operating and service costs, provide higher quality services, and achieve economic and administrative autonomy for local authorities. Five regional authorities in Nicosia, Limassol, Larnaca, Paphos, and Famagusta will consolidate services like water supply, sewerage, waste management, and development licensing to create economies of scale and standardise services.

Twenty new municipalities have been created by merging 30 existing municipalities and 50 communities, saving resources and ensuring financial independence. Municipal funding is also changing, with revenue from annual car traffic charges redirected to municipalities to reduce their dependence on state sponsorship.

The reform includes measures to enhance transparency and control, such as preventive internal control units in each municipality and the online publication of all decisions. However, the number of deputy mayors and municipal councillors is increasing, raising costs. The state grant to municipalities will reach €117 million in 2024, an increase of €46 million, although the overall cost of the reform is expected to exceed this amount due to budget shortfalls.

Additionally, 30 local service clusters have been created to provide specialised staff for various functions, with the government covering the €3 million employment cost. The reform also involves transitioning development authorisation procedures to EDAs, with applications now submitted electronically through the "Hippodamos" system.

The new municipal and provincial structures have been established, with elected officials from the June 9, 2024, elections. Detailed compositions of the new municipalities and community clusters have been outlined for the districts of Nicosia, Limassol, Larnaca, Paphos, and Famagusta.

Overall, the reform aims to improve local governance, service delivery, and economic sustainability, despite initial implementation challenges.