Many small and medium-sized businesses operating in city centers are being asked to pay thousands of euros more than they have been paying for eight years, with shopkeepers and restaurant owners citing “wrong timing” on the part of the Ministry of the Interior.
Specifically, the disturbance was caused by the decision of the Ministry of the Interior to restore the fees paid by those operating businesses in the city centers for “virtual” parking spaces, to the levels that applied before 2016. The difference amounts to several to several thousand euros, since some cases it can even exceed €50,000.
The parties involved were invited to submit their positions on the matter to SIGMA and the Mesimeri and Kati broadcast. The Director of the Office of the Minister of the Interior, Loizos Hatzivasileiou, the President of the Interior Committee of the Parliament and MP of AKEL, Aristos Damianou, and the President of the All-Cyprus Association of Entertainment Centers, Nikos Vassiliou, were hosted in the studio.
The fees and the reason for the increases
Explaining the existing context surrounding the right to “purchase” parking spaces from businesses in cities and the reasons why it is increasing, Loizos Hatzivasileiou stated that this “price” existed since 1996 with an order issued by the Ministry of the Interior. In essence, businesses that could not indicate the required parking spaces, had the possibility to make a “purchase”, with the money ending up in a Special Fund for the Purchase of Parking Spaces operated by each municipality.
Subsequently, the revenues of the fund should be used by the municipalities for the purposes of creating parking spaces, in order to reduce the effects for the residents of these areas from the operation of businesses.
The 1996 mandate provided for specific amounts that remained unchanged until 2016, but were reduced by 50% due to the economic recession that prevailed, after the financial crisis, as a measure of support for entrepreneurs who could not indicate premises parking in new developments.
From 2016 until today, the following amounts for each parking space applied to the categories below, which fall within the central areas:
In shopping centers where the acquisition concerns less than 10 parking spaces, the cost is set at 5,000, while for more than 10 at 8,500
In pedestrianized areas with less than 10 parking spaces, the corresponding cost reaches 2,500, while for more, 5,000.
The order was implemented for three years, being extended again in 2019 due to the pandemic and reduced traffic and again in 2022 for another year due to the war in Ukraine. These Plans expired on December 31, 2023, with Mr. Hatzivasiliou pointing out that after evaluating the existing development and the possibilities that exist, the Ministry of the Interior decided not to renew the mandate, restoring the fees that were in force before, doubling as of therefore, the amounts.
The costs are not the same as in 1996
He clarified that, as a rule, businesses must indicate parking spaces, however, this arrangement was made to cover the owners of spaces in the cores of cities due to the inability to have parking spaces.
“These sums must be such that they can really enable the housing local authorities to create such parking spaces”, he underlined, focusing on the fact that the cost needed to buy a plot, which will be converted into a parking space to replace those without businesses, has not remained the same since 1996.
Asked to comment on how he sees the whole development, the President of the Internal Affairs Committee, Aristos Damianou, agreed that this method was perhaps not the most “orthodox”, but it worked helpfully at times for businesses
Damianou: Fees should not have been increased – The timing was wrong
Commenting on the President of the Interior Committee and Member of Parliament of AKEL, Aristos Damianou, he said that there should indeed have been a streamlining of the specific framework, however, the timing of the Government’s choice to reinstate the previously applicable fees is troubling.
“The reasons for which in the past it was deemed necessary to extend this regulation, by order of the Minister, in a similar way should remain today”, he underlined. He referred to the conditions prevailing in our region today, which affect tourist traffic, as well as the accuracy and high inflationary trends affecting factors such as electricity and fuel, creating additional operating costs for businesses.
Mr. Damianou expressed the opinion that before the Government proceeded, there should have been a dialogue with the affected bodies, a position with which the President of the All-Cyprus Association of Entertainment Centers, Nikos Vassiliou, agreed, who during his intervention today he also represented OSYKEDE.
“Perhaps what is happening today is a sudden death,” Mr. Damianou stressed, pointing out that businessmen included this regulation as it was in their operating expenses. At the same time, he called on the Ministry of the Interior to review the process and added that “at this time of high pressure on businesses and leisure centers, in fact the tourist season has also started, it might not have been the most appropriate time and action to do it”.
Resources were not utilized by local authorities
For his part, Mr. Vassiliou, after explaining that all seven organizations representing the sector have merged into a coordinating body called OSYKEDE and which make up 90% of the space, agreed with the opinion that this measure provided outlets for planned period. In fact, he stated that they themselves had requested a 50% reduction in the fee and its extension, expressing his satisfaction with the response shown by the Ministry.
As he said, under the new conditions that are being created, which are reminiscent of the previous two years, the measure should be extended, while he also noted that there should be meetings regarding its rationalization. He also expressed the organization’s readiness to submit proposals.
Mr. Vassiliou underlined, however, that the local authorities have not proven to date that they have used the resources obtained from these fees to create parking spaces to serve the businesses that contributed to this fund.
It is also worth pointing out that POVEK also sent a note on the matter, expressing its opposition to any increase and asking for transparency about where it ends up and how the collected money is used.
The Ministry of the Interior is open to dialogue
Towards the end of the discussion, the Director of the Office of the Ministry of the Interior, left open the possibility of a review, saying that if and as long as the businesses can provide evidence, proving that their turnover is at the turnover levels of 2016 and 2019 then could be re-evaluated.
Watch the video here:
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