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Remuneration and benefits of Mr Nikos Christodoulides as Advisor or Consul General A, Ministry of Foreign Affairs, during the period from 14.4.2014 to 28.2.2018 when he performed the duties of Government Representative
1. Introduction
(a) On 24.9.2023 our Office received a complaint with allegations concerning the remuneration and benefits received by the President of the Republic (PM) during the period when he was performing duties as Government Spokesperson. The complaint was anonymous to us but was forwarded to us through a media outlet, which reported to us that it knew the identity of the complainant. On 25.9.2023 we forwarded the complaint in its entirety to the Presidency of the Republic and the Ministry of Foreign Affairs and requested, for investigation purposes, the submission of specific information/documents.
The Ministry of Foreign Affairs replied to us on 28.9.2023.
The Presidency of the Republic replied to us on 17.10.2023.
The Presidency of the Republic replied to us on 17.10.2023. On 24.10.2023 we requested clarifications and additional information which were sent to us by letter dated 24.10.2023. 9.11.2023, which was received by our Office on 15.11.2023. On 21.11.2023 we requested additional clarifications and data and on 27.11.2023 we forwarded a draft of this communication to the Presidency for any comments. On 4.12.2023 we received from the Head of Presidency Administration two letters, the first dated 30.11.2023 and the second dated 4.12.2023. Both were classified as Confidential.
(b) Under the Classified Information Security Decree of 2013 (CPR 410/2013), a document is classified as Confidential in cases where its disclosure to an unauthorized natural person may harm the vital interests and stability of the institutions of the Republic. The term "vital interests and stability of the institutions of the Republic" includes:
- the defence and security of the Republic, public morals,
- constitutional order, public order, public health,
- the operational capacity of the security forces of the armed forces and the authorities of the Republic in general,
- the relations of the Republic with other States,
- the rights and freedoms guaranteed by the Constitution of the Republic, and
- the reputation or rights of any person or persons.
We note that in the two letters of the Presidency Administration referred to, and in particular in the one dated. 4.12.2023, do not contain any elements that could reasonably justify the Presidency's decision to downgrade the two letters, particularly in view of the provision of the Order that, the level of downgrading should be the lowest level that can be given. However, because the authority to classify information rests with the issuer of the classified information, our Office will not publish the two letters as an Annex and will limit itself to commenting in general terms on the allegations contained therein.
(c) The letter from the Presidency Administration dated. 4.12.2023, records, in summary, the position that:
- The Audit Office has no authority to express an audit opinion on its findings in regulatory matters, unless it first obtains an opinion from the Attorney General of the Republic,
- this Notice constitutes an excess of authority because its conclusions were based on an erroneous legal interpretation given by the Audit Office rather than the Legal Office,
- the failure to obtain an opinion from the Attorney General is likely to be perceived as a deliberate misidentification of components that should characterise the action of the Audit Office, and
- there may be a breach of privacy in the Notice and the opinion of the Data Protection Commissioner should have been sought.
The above allegations are rejected by our Office for the reasons set out at length in paragraphs 2 and 6 below.
2. Institutional framework of the Comptroller General's powers
(a) This compliance audit was carried out within the framework of the constitutional powers of the Comptroller General of the Republic and the provisions of the Fiscal Responsibility and Fiscal Framework Law
(Law No. 20(I)/2014) and aimed to ascertain the regularity of the expenditure related to the matter in question, i.e. whether it was carried out in accordance with the established legal framework. Due to the relatively small scope of the audit, the report is made public in the form of a Communication.
Article 116 of the Constitution of the Republic provides that the Auditor General, assisted by the Assistant Auditor General, shall audit in the name of the Republic all receipts and payments of the Republic. Also, according to Article 81 (2) of Law 20(I)/2014, the Auditor General shall conduct the audit of the final accounts of the Republic and the financial statements, on the basis of internationally recognized auditing standards that he/she shall determine.
As explicitly stated in the Audit Guidelines issued by the Auditor General, all audits of the Audit Office, i.e. financial, regulatory and management audits, are conducted in accordance with the Professional Standards Framework issued by INTOSAI, which forms part of the acquis communautaire.
The INTOSAI World Congress adopted, in 1977, the "Lima Declaration on Guidelines on Auditing Principles", which includes references to the purpose and types of audits carried out by Supreme Audit Institutions (SAIs), the independence of SAIs and their relationship with the House of Representatives, the government and the administration, their powers and the methodology they follow. The Declaration itself is recorded in the most fundamental INTOSAI Standard - P1, which is the "Magna Carta" in the exercise of external audit of governments, since it lays the foundations of public audit. This Standard explicitly explains that, the traditional role of HEIs is to audit the legality and regularity of financial and accounting management.
As founded in an opinion dated. 28.10.1963 of the first Attorney General of the Republic, Crito Tornaritis, an integral part of the control provided for in the Constitution carried out by the Audit Service is the legality and regularity of transactions. As noted, the audit of the Audit Office is not limited merely to certifying the existence of apparently normal supporting evidence in relation to the amounts shown in the financial statements of the Republic, but must also cover the legality and regularity of transactions. The opinion also relies on a relevant British Court decision, as follows:
"With regard to the duties of an auditor Lord Russell Chief Justice observed in Thomas v. Devonport Corporation (1900) 1 Q.B. at p.21 as follows:
"I do not subscribe to the doctrine that his sole duty is to see whether there are vouchers, apparently formal and regular, justifying each of the items in respect of which the authority seeks to get credit upon the accounts put before the auditors for audit. I think that is an incomplete and imperfect view of the duties of the auditors. I think an auditor is not only entitled, but justified and bound to go further than that, and by fair and reasonable examination of the vouchers to see that there are not amongst the payments so made payments which are not authorised by the duty of the authority, or contrary to the duty of the authority, or in any other way illegal or improper. If he discovers that any such improper or illegal payments appear to have been made, his duty will certainly be to make it public by report to the authority itself, and the burgesses who create that authority"".
In free translation:
"I do not agree with the theory that his (the auditor's) sole duty is to check whether there are invoices, apparently true and regular, which justify each of the items as to which the competent authority seeks certification on the accounts which it has submitted for audit to the auditors. I think this is an inadequate and incomplete understanding of the auditors' duties. I think an auditor not only has a right, but is justified and obliged to go beyond that, and by a fair and reasonable examination of the invoices, to find that, among the payments made, there are no payments that are not authorized on the basis of the competent authority's duties, or that conflict with the competent authority's duties, or that are otherwise illegal or erroneous. If he finds that such erroneous or illegal payments have been made, it will certainly be his duty to make this public with reference to the competent authority itself and to the citizens who support that authority."
(c) ISSAI Standard 400 defines compliance audit (or regulatory audit) as an independent assessment of whether a given matter complies with the principles set out as audit criteria. These audits aim to assess whether the actions of the audited entity comply with the principles or rules that govern it. These principles and rules may relate to compliance with provisions of relevant laws, regulations or agreements or with general principles of sound financial management and the conduct of public officials.
(d) And based on case law (Panagius Perdicus v. CYPRUS REPUBLIC OF CYPRUS BY THE EDUCATIONAL SERVICES COMMISSION, Revision Appeal No. 181/10, dated. 29.1.2016), the application of the Law by the administration (in our case by the Audit Office), presupposes, where necessary, the interpretation of the Law. As stated in the text "The Reasons for Administrative Acts and Judicial Review", M. Pikramenos, Sakkula Publications, 2012, p. 7: "Rules of law usually require interpretation, so the relevant competent body must often interpret the applicable legal regime in order to justify the operative part of the administrative act."
In the context of an audit, the Audit Office has the power, and not the obligation, to seek legal advice if, in its judgment, doubts remain as to the interpretation of a legal text, such as to create a risk for it to express an opinion on any matter which would prove to be materially erroneous. The decision, therefore, as to whether legal advice, or any other kind of expert opinion, should be sought, shall be taken by the Audit Office itself. If it decides that legal advice should be obtained from the Attorney General of the Republic, it shall do so on the basis of the relevant Standards. ISSAI Standard 100 (Fundamental Principles of Public-Sector Auditing) provides the following:
"Where relevant or necessary, and in line with the SAI's mandate and the applicable legislation, the auditor may use the work of internal auditors, other auditors or experts. The auditor's procedures should provide a sufficient basis for using the work of others, and in all cases the auditor should obtain evidence of other auditors' or experts' competence and independence and the quality of the work performed. However, the SAI has sole responsibility for any audit opinion or report it might produce on the subject matter; that responsibility is not reduced by its use of work done by other parties."
Related to this is ISSAI Standard 2620, which also explicitly states that such an expert may be a person called upon to provide advice on matters of interpretation of laws, regulations or contracts.
From the foregoing it is clear that, even where an opinion or other scientific advice is obtained, the sole responsibility for the correctness of its findings and recommendations remains with the Audit Office which, in exercising its judgment, decides how to take into account all the evidence before it.
[E] We note that the two immediately preceding Attorneys General, in their opinions, had clearly explained that "any judgment of the Auditor General, in the exercise of his functions under the Constitution and/or any law, is beyond the control of the Legal Service and/or any Ministry."
3. Relevant administrative acts and provisions of law
(a) On 26.11.2013 the Public Service Commission (PSC) decided on the secondment of Mr. Nikos Christodoulides, Counselor or Consul General A, Ministry of Foreign Affairs, to the Presidency from 1.10.2013 to 30.09.2016 to perform Special Duties. He has been assigned the duties of Director of the Diplomatic Office of the President of the Republic. 13.12.2013 included the following reference:
"Mr. Nikos Christodoulides, Permanent Adviser or Consul General A, External Services, is seconded to the Presidency and the Presidential Palace to perform special duties, pursuant to Article 47(1)(e) of the Public Service Acts of 1990 to 2013, from 1 October 2013 to 30 September 2016."
(b) The section 47 of the Public Service Act referred to provides as follows. (1)Posting of an employee may be decided in any of the following cases
(a) To fill a vacancy, after selection, under Article 30
(b) where a decision is taken to promote an official to a higher grade under Article 43
(c) where there is a vacancy or official need
(d) where the performance of duties is required to meet official needs in a Ministry, Department, branch or service
(e) in special cases when the performance of special duties and responsibilities in a Ministry, Department, Branch or Service is required;
[F]
(f) for the performance of special duties in a diplomatic or other mission of the Republic abroad or in a service or agency of the European Union or in a service of a country of a Member State of the European Union or in an international organisation.
(2) Except in the case of paragraph (a) of subsection (1), a staff member who is seconded shall continue to hold the post from which he is seconded, but shall be subject to the hierarchical administrative control of the Head of the Department to which he is seconded.
(6) Postings under paragraphs (c), (d), (e) and (f) of subsection (1) may be for a period not exceeding three (3) years and may be renewable:
(7) Postings shall be published in the Official Gazette of the Republic."
[C]In Regulation 10 of the Public Service (Remuneration, Allowances and Other Financial Benefits of Public Servants) Regulations (KΔP 175/1995), the following is provided for:
"10. P.P.P.2. (1) of the Regulation. 9 above, an employee seconded to perform duties and functions under para. (d) and (e) of subsection (1) of section 47 of the Public Service Acts, 1990 to 1994, shall continue to receive the salary of his post:
Provided that the Minister of Finance may, in special cases and on the basis of criteria to be determined by the Council of Ministers, authorise the payment of a special allowance or special salary for such duties."
(d) On the basis of Cabinet Resolution No. 76,776 of the Cabinet of Ministers, dated. 9.4.2014, the (former) President of the Republic informed the members of the body that, at this stage, he does not intend to appoint a new Government Representative following the resignation of Mr Christos Stylianides on 13.4.2014, and will assign the duties of the Government Representative to Mr Christodoulides as of 14.4.2014, in addition to the existing duties of the Director of his Diplomatic Office. Following this information, the Council of Ministers has decided that, for the period of performing the parallel duties:
(i) approve the granting of a salary equal to the difference between the existing gross salary of Mr. Christodoulides and the gross salary received by the Government Spokesperson,
(ii) approves the granting of all other benefits to which the Government Spokesperson is entitled, and
(iii) authorize the Minister of Finance to take all necessary actions to implement the above Decision.
Pursuant to Article 57.4 of the Constitution concerning Decisions of the Council of Ministers:
"If the decision is enforceable and the rights of veto or referral have not been exercised in accordance with the provisions of the second or third paragraph of this Article, the President and the Vice President of the Republic shall issue a decree by publication in the Official Gazette of the Republic the decision, unless the Council of Ministers determines otherwise by its decision."
The Decision of the President of the Republic and the Council of Ministers were not published in the Official Gazette of the Republic.
In this case, the Council of Ministers did not decide not to publish its Decision therefore, the non-publication of the Decision constitutes a violation of this article of the Constitution
We asked the Presidency of the Republic to forward to us any letter or document of this assignment which had been given to Mr. Christodoulides. The Presidency did not return on the matter.
In this regard, we note in passing the legal loophole that existed. In March 2013, the appointment of Mr Christos Stylianides as Government Representative was published in the Official Gazette of the Republic as of 1.3.2013. The next reference we found in the Official Gazette on this matter was in March 2018, when the appointment of Mr Prodromos Prodromos as Government Spokesperson from 1.3.2018 was published. We have not identified any reference in the Official Gazette regarding the resignation of Mr. Stylianides.
(e) On 14.4.2014 it was announced through the Press and Information Office that "the President of the Republic, following the resignation of Christos Stylianides from the position of Government Spokesman, has decided at this stage, to entrust the execution of the duties of the Government Spokesman to the Director of his Diplomatic Office, Mr. Nikos Christodoulides. Mr Christodoulides will continue to perform the duties of the Director of the Diplomatic Office of the President of the Republic in parallel."
As mentioned above, apart from this announcement, there has been no official appointment, nor has there been any publication in the Official Gazette of the Republic of the assignment of the duties of Government Representative to Mr Christodoulides. Besides, as we explain in the immediately following paragraphs (f) and (g), there could not have been such a formal appointment, since the position of Government Representative is incompatible with the position of a civil servant.
(f) On the basis of the Protocol of the Republic of Cyprus (Internal Regulations) Law (Law 59(I)/1996), the Government Representative takes precedence in the Protocol over the Deputy Minister to the President. Also, in the State Budget, in the Chapter "Presidency and Presidential Palace" - "Officials of the Republic", the position of the Government Representative is immediately below the President of the Republic.
The highly political nature of the position of the Government Representative is also evident from the fact that, based on a provision in the State Budget, the Government Representative has the power to recruit Consultants/Associates under the Article "Political Appointments".
Also, in the Pensions (Certain Officials of the Republic) Law (Law No. 49/1980), the position of Government Representative is, for purposes of pension benefits, included in the definition of a Minister.
(g) It is well established that there can be no holding of a political office by a civil servant because of the clear separation and the clear distinction between political power and the administrative function of the State. In Decision no. 7.11.2011 of the Plenary Session of the Supreme Court in the case President of the Republic v. House of Representatives (No. 3) (2011) 3 AAD 777, Report No. 5/2010 and 6/2010, it was decided, inter alia, as follows. Already in Frangoulides (No. 2) v. The Republic (1966) 3 C.L.R. 676, there was a conscious understanding that went beyond the express provisions of the disputed Article 59.2 of the Constitution on the incompatibility of the office of Minister with a position in the public service. As indicated by Judge Vassiliadis, giving the judgment of the Plenary Chamber (p. 684):
"The practical reasons of such incompatibility between the two public offices in question, are obvious. The one is an office of a political nature; the other is the office of a specially qualified and well experienced permanent officer in the public service. The very structure of the Public Service Commission in our Constitution (Articles 122-125 inclusive) is to keep the two apart, and independent of each other."
The distinction was reaffirmed by the Full Bench in R.I.K. and Others v. Karagiorgis et al. (1991) 3 A.A.D. 159. Judge Pikis, giving the majority judgment (Judges Pikis, Malachtos, Papadopoulos, Hadjitsangaris and Nikitas), indicated that (pp. 179-181):
"The Cyprus Constitution makes a distinction between the political power and the administrative function. It prohibits the interference of political power in the administrative function of the State. This distinction was recognised by the Full Bench of the Supreme Court in Frangoulides (No. 2) v. The Republic (1966) 3 C.L.R. 676. The purpose is, as indicated in the Court's judgment, to keep the administrative function away from political influence."
(h) On 28.9.2016, the NEC decided to renew the secondment of Mr Christodoulides to the Presidency until 28.2.2018.
In the Official Gazette of the Republic dated 28.2.2018. 14.10.2016 included the following reference:
"The secondment of Mr Nikos Christodoulides, Permanent Counsellor or Consul General A, External Services, to perform special duties at the Presidency and the Presidential Palace, pursuant to Article 47(1)(e) of the Public Service Acts 1990 to 2015, is renewed until 28 February 2018."
(i) On 27.2.2018, the NEC accepted the retirement of Mr Christodoulides with effect from 1.3.2018, the date on which he was appointed Minister of Foreign Affairs.
In the Official Gazette of the Republic on 1.3.2018. 9.3.2018 the following report was included. 3) of 2017, with effect from 1 March 2018."
In view of the above, Mr Christodoulides held and retained his status as a public servant until 28.2.2018, when he retired.
4. Benefits received by Mr. Christodoulides during the period 14.4.2014 to 28.2.2018
(a) Based on information from the General Accounting Office of the Republic, during the period 14.4.2014 to 28.2.2018, Mr. Christodoulides received, in addition to his regular salary, the following gross amounts (before payroll deduction and income tax deduction) as part of his salary.
| | 2014 |
[TD]
2015
[/TD] [TD]2016
[/TD] [TD]2017
[/TD] [TD]2018
[/TD] [TD]Total
[/TD] [/TD][TR] [TD] [TD]
€
[/TD] [TD]€
[/TD] [TD]€
[/TD] [TD]€
[/TD] [TD]€
[/TD] [TD]€
[/TD] [TD]
€
[/TD] [/TR] [TR] [TD]
Alternate Appointment*
[/TD] [/TD] [TD]13.025
[/TD] [TD]16.776
[/TD] [TD]18.174
[/TD] [TD]16.192
[/TD] [TD]2.658
[/TD] [TD]66.825
[/TD] [/TR] [TR] [TD]
Performance Allowance
[/TD] [TD]17.065
[/TD] [TD]23.905
[/TD] [TD]23.905
[/TD] [TD]21.514
[/TD] [TD]3.995
[/TD] [TD]90.384
[/TD] [/TD] [/TR] [TR] [TD]Total
[/TD] [TD]30.090
[/TD] [TD]40,681
[/TD] [TD]42,079
[/TD] [TD]37,706
[/TD] [TD]6,653
[/TD] [TD]157.209
[/TD] [/TR]
* Difference between the gross salary he received as Counselor or Consul General A and the gross salary provided for the Government Representative in the Budget.
(b) From the day after his retirement from public service, Mr. Christodoulides receives a monthly civil servant's pension of €1,013, which corresponds to his service until 31.12.2012, in accordance with the provisions of Article 10 of the Law on Pension Benefits of State Employees and Employees of the Wider Public Sector, including Local Government Authorities (General Application Provisions) (Law 216(I)/2012).
The remaining pension, earned for the period from 1.1.2013 to 28.2.2018, will start to be paid when he/she reaches the age of 58.
On his retirement, he also received a lump sum of €56,752 for his service until 31.12.2012 and an amount of €11,411 (less €4,000 tax) for his service until 28.2.2018 (the second amount was paid on 21.12.2018
).12.2021).
In calculating his pension benefits (pension and lump sum), correctly the allowances in paragraph 4(a) above were not taken into account.
(c) Based also on information from the General Accounting Office, for the period 14.4.2014 to 28.2.2018, Mr Christodoulides received the amount of €41,024 as a foreign maintenance allowance for travel abroad. This allowance does not include airline tickets or hotels, the cost of which was paid and covered separately by the Presidency of the Republic. Christodoulides was compensated with the Category A allowance, which, according to the relevant circular of the Ministry of Finance, also includes the Government Spokesman.
(d) During the period from 14.4.2014 to 28.2.2018, Mr. Christodoulides used a car for exclusive use.
(e) Upon his retirement from public service on 28.2.2018 to take up the duties of the Minister of Foreign Affairs, Mr. Christodoulides the equivalent of 75 days' rest leave, in his trust, of €18,176 less deductions for income tax and reduction in earnings.
(AF)
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