LOCAL GOVERNMENT - THE REFORM HAS PASSED THE FIRST MAJOR STRESS TEST - Filenews 5/7 by Giorgos Koukounis
July 1, 2026 marks the completion of two years since the implementation of the Local Government reform, one of the most important institutional changes implemented in the Republic of Cyprus after its accession to the European Union.
The merger of municipalities, the creation of Provincial Self-Government Organizations and the transfer of essential responsibilities from the central administration constitute a profound change in the philosophy of public administration.
Major reforms, however, are not judged either by the intentions or by the legislation that accompanies them. They are judged by their implementation and, above all, by whether they change the daily life of the citizen for the better. With this criterion, the reform of Local Government must also be evaluated.
From institutional change to administrative maturity
The first conclusion is that the reform has endured. Despite the reasonable reservations raised prior to its implementation, the new system has operated without creating an administrative vacuum or institutional instability. The new municipalities and the Provincial Organizations assumed their responsibilities, maintaining the continuity of basic services.
Bringing together organizations with different financial capabilities, different administrative practices and different organizational culture was a particularly demanding task. At the same time, larger and administratively stronger municipalities were created, with the possibility of better strategic planning, more efficient use of human and financial resources and greater claiming of European funding. The philosophy of economies of scale, which formed the core of the reform, is gradually starting to pay off.
However, this is precisely where the most important lesson of the two-year period emerges. The adoption of a modern institutional framework is not enough on its own. Effectiveness ultimately depends on the administrative capacity to implement it. Public administration does not change only with laws, it changes with organization, human resources, technology and continuous evaluation.
The weaknesses that should not be ignored
The difficulties in issuing planning and building permits have highlighted precisely this reality. The transfer of responsibilities has not always been accompanied by the corresponding administrative readiness. Staff shortages, heterogeneity of procedures and delays in full digitalisation have created problems affecting building development, investment and citizens' trust.
At the same time, there is still a significant dependence of local authorities on central government. Real decentralization does not only mean a transfer of responsibilities. It also presupposes financial autonomy, a clear distribution of responsibilities and substantial accountability. Otherwise, there is a risk that local authorities will take on increased obligations without the necessary means to meet them.
From a legal and institutional point of view, the reform is an important development, because it reinforces the principle of proximity, where decisions must be taken as close as possible to the citizen. But proximity without efficiency is not enough. Decentralization only gains value when it is accompanied by better services, transparency and faster decision-making.
At the same time, the progress of the reform will also be assessed in terms of its compliance with the principles of the European Charter of Local Self-Government, which highlights subsidiarity, local autonomy, democratic participation, accountability and the rule of law as the foundations of modern European governance.
The next test
The second phase of the reform is perhaps more difficult than the first. It is no longer about creating new institutions, but about improving their functioning. Priority must be given to the full digitalisation of services, the acceleration of permitting procedures, the strengthening of the administrative capacity of the new organisations and the development of a more stable and fair funding system.
Reforms are not judged by the laws that are passed, but by the trust they inspire in citizens. If the citizen continues to face delays, bureaucracy and confusion of responsibilities, then even the most ambitious reform will be considered incomplete. On the contrary, if daily service becomes simpler, faster and more efficient, then the reform of Local Government will have vindicated its historical character.
Two years later, we can say that the foundations have been laid. The big issue, however, is no longer to change the administrative map of Cyprus. It is the construction of a Local Government that will justify the trust of the citizens on a daily basis and will prove that the institutional reforms are not justified by the range of changes they introduce, but by the quality of the governance they produce, the effectiveness of the services they offer and the trust they inspire in the citizens every day.
* Lawyer in Larnaca
