‘Parties should pay state back €2.5 million’

The state needs to recoup €2.5 million given to political parties in grants over the last few years, the auditor-general said in a report released Tuesday.

In its report auditing parliament, the Audit Office said the matter remains in limbo due to disagreements over how the funds can be returned to the state, or who would sue the parties to force them to return them.

Of the funds in question, €577,000 concern grants given to parties for the 2021 parliamentary elections. The rest concern grants given for the 2018 presidential election.

Annual grants to political parties are credited to the parliament, as part of its budget, and parliament then distributes the funds among the parties.

But the various agencies involved can’t agree on the course of action to be taken to recoup the money. The attorney-general and the finance ministry say it’s parliament which must file lawsuits against the parties. Alternatively, they propose that future grants to parties be withheld, in this way indirectly getting back the funds.

Parliament insists it has no jurisdiction to intervene in the matter, and that any legal action should be filed by the attorney-general’s office.

As a result, zero action has been taken.

The Audit Office notes that it doesn’t really matter who files the lawsuits, and has urged the government to get its act together.

Part of the issue relates to the 2021 legislative elections. In February of that year, three months prior to the elections, the state disbursed in one go the entire annual grant amount for the parties for 2021. This came to €7 million.

But this meant that the new parties which won a seat in parliament received no grants from the state for the year 2021, whereas parties which did not make it back into parliament – or saw their percentages drop – got to keep all the funds allocated to them.

The first party to react to this situation was Dipa, which earned four seats in parliament but received not a single cent in state grants for 2021.

Based on a legal opinion furnished by the attorney-general at the time, the finance ministry recalculated the distribution of the grants. It concluded that €577,000 should be recouped from four political parties which either did not manage to return to parliament or experienced a drop in their percentage of the electoral vote.

Specifically, the opinion deemed that the Citizens Alliance should return €277,000. This party is now being disbanded.

In addition, Solidarity must return €251,000; party leader Eleni Theocharous has expressed readiness to return the funds if she is formally asked to do so.

Diko meanwhile must give back €47,000, but party leader Nicholas Papadopoulos disagrees and has even threatened legal action should the government withhold any money from future grants. Lastly, Akel has agreed to return to the state the amount of €1,500.

If recouped, the €577,000 amount would be divvied up among Dipa, Elam, Edek, Disy and the Greens.

The other aspect concerns €2 million given in grants for the 2018 presidential elections. As the auditor-general points out, this amount disbursed to the political parties was ultimately not spent and should therefore be returned to state coffers.

The money was given so that political parties would spend it on their election campaigns. Instead, the parties tapped into other funding sources for the election campaign, and simply pocketed the state grant.

In this case, Disy should return €800,000, Diko €380,000, Akel €200,000, and Edek €160,000. In addition, the Citizens Alliance must return €159,000, Solidarity €138,000, the Greens €127,000, and Elam €98,000.