PM BACKTRACKS AFTER BACKLASH
PRIME Minister Faiz Sucuoğlu announced reductions in electricity rates and alcohol duty this week. The decisions were taken on Tuesday during an “emergency” Council of Ministers meeting following public outrage over electricity bills of three to four times higher than the previous month, following the implementation of a new pricing structure on March 1.
The previous week had also seen widespread discontent among the restaurant and entertainment sectors due to big increases in alcohol duty.
Speaking after the almost two-and-half-hour cabinet meeting, Dr Sucuoğlu said kilowatt-hour (kWh) energy prices had been reduced following the strong public reaction to their bills.
According to Dr Sucuoğlu’s statement, while the price of the first 250kWh of electricity used per month remains at 98 kuruş per kWh, the cost of 251-500 kWh is now 1.70TL per kWh instead of 2.70TL; 501-750 kWh is 2TL per kWh, down from 2.95TL; 751-1,000 kWh costs 2.25TL per kWh, reduced from 3.25TL; and usage of 1,001 kWh and over is 3.30TL per kWh, down from 4TL.
In addition, as a result of “discussions with all sector representatives”, the electricity fee for the tourism, industry, education, animal husbandry and similar sectors was reduced from 2.70TL per kWh to 1.70TL.
Dr Sucuoğlu added that the price changes will be “reflected” in March bills, and that any bills paid by direct debit will be “offset”.
However it was unclear from the statement what will happen to March bills that have already been paid, if the Cyprus Turkish Electricity Authority (Kıb-Tek) will re-issue March bills, or if the new rates will be permanent or only for a limited period before reverting back to the higher rates.
At the time Cyprus Today went to print, the Kıb-Tek website had not been updated with the new rates, nor had they been published in the Official Gazette.
Finance Minister Sunat Atun reportedly said following Dr Sucuoğlu’s announcement that the Finance Ministry will need to find an extra 180 million TL a month to pay for the “electricity bill subsidy”.
Mr Atun said his department will “make every effort to find this resource for the first month” but that the Treasury’s borrowing ability has become “extremely limited” and the TRNC’s budget deficit has reached the “highest rate in history”.
He also announced that his ministry is preparing a “criminal complaint” file for
the Chief Prosecutor’s Office “against those who caused Kıb-Tek to suffer heavy financial losses”.
ALCOHOL
Dr Sucuoğlu also said that “research” into alcoholic beverage sales had showed a “shift” to South Cyprus since the higher duty rates were announced last month, so a “new amendment” was made to “restore the balance and turn the shift back to the North”.
Dr Sucuoğlu stated that as a result of discussions with importers-exporters, the restaurant sector and small businesses, the government concluded that it was “necessary” to make this decision.
As a result, he said that duty per litre has been reduced from 50TL to 25TL on imported drinks; from 40TL to 15TL for domestic drinks; from 20TL to 7TL on wine; from 15TL to 5TL on beer; and from 17.5TL to 6TL on draught beer.
Dr Sucuoğlu told reporters that the TRNC is suffering from the effects of the “economic crisis, the pandemic and the RussiaUkraine war”.
He added that it is “virtuous and inevitable to correct a mistake if some of the measures taken by the government” in the face of such economic crises have caused “distress” to the public.
Speaking about the “very high” electricity bills consumers have received, the PM said the government had decided to “subsidise electricity prices after many people complained about the bills and almost revolted”.
“We will not let our people hang their heads, we will use all the means to the fullest so that they can breathe more easily,” he added.
❐ CONSUMERS who owe 675TL or more from their February electricity bills will have their supply cut off if they don’t pay by Monday, April 11, KıbTek has warned.
❐ Bill shock for thousands as electricity price rises hit, pages 12&13