Clustering general-presentation (Project Cyprus Part III)

NOTORIA International
Nicosia - Rome, March 2015
CLUSTERING IN CYPRUS
Project proposal
General overview
Ing. Mauro Giorgini

SUMMARY
FORWARD Politics and politicians approaches
THE LOCAL GOV. IN EU & IN CYPRUS Today local government organizations in Europe
THE PROBLEM Why we are here
THE PROPOSAL Our approach
FOCUS ON STEP 2 Clustering
- Cyprus division in clusters
- Cluster organization
- Debt reduction
- Administrative Council
CLUSTER IMPLEMENTATION How the project can be implemented
- Project’s deliverables

The Local Government Reform, will only succeed with strong Municipalities
and Communities, otherwise it will fail.
Nobody is as close to the people, their problems and demands as the
Municipalities and the Communities are.
FORWORD Basic principles
Our believe

START FROM THE BEGINNING: ETYMOLOGY
MUNICIPALITY:
• In Greek, “δήμος , that means «People»
• It is a Latin word, “Munia caperet”, that means “Assume the burden of the citizens”
-
COMMUNITY:
• In Greek «κοινότητα», that means «Citizens of a small village»
• it is a Latin word, «Communitas, communis», that means «Common, together»
How these two ancient words, rich of deep significates for each people community,
can be declined in the today local administration ?
FORWORD Etymology of the words

What does MAN mean?
- The Man is bad, he must be controlled
- The Man is god, he must be let free
- Do I rule myself or do I rule the people ?
- Do I service myself or do I service the people?
QUESTION ANSWERS
Freedom
Responsibility
THIN GOVERNMENT
DECENTRALIZATION
STRONG GOVERNMENT
CENTRALIZATION
Dominion
Service to the People
OWN SERVICE
RULE THE PEOPLE
SERVICE TO THE PEOPLE
THE PEOPLE RULE
TYPE OF GOVERNMENTETHIC OF THE POLITICIANS
FORWORD Politics and politicians approach
CITIZENS

THIN
GOVERNMENT
STRONG
GOVERNMENT
UNFAIR
POLITICS
FAIR
POLITICS
Strong control of the central government on the local entities
Municipalities and Communities consolidation
Service responsibility transfer from local to central government
No control from the central government on the local entities
Every local entities for itself
Service responsibility transfer from central to local government
Anti corruption legislation
Transparency of the government’s actions
Independent monitoring and control
De-penalization legislation
No transparency on the government’s acts
No independent monitoring and control
Share the resources among local entities
Transfer responsibility from central to local government
Independent monitoring and control
Transparency on the government acts
CLUSTERING
FORWORD Third way: clustering

THE LOCAL GOVERNMENT
IN EUROPE
AND IN CYPRUS

COUNTRY
No. of LOCAL
ENTITIES
AVERAGE
POPULATION
AVERAGE AREA
(SqKm)
EU 27 5.430 47
CYPRUS
(Municipalities)
30 20.051 23
CYPRUS
(Communities)
340 676 19
ITALY 8.057 7.320 37
GREECE 325 10.820 128
FRANCE 36.681 1.730 15
UNITED KINGDOM 426 140.050 562
GERMANY 11.292 6.650 29
SPAIN 8.116 5.530 62
PORTUGAL 308 34.440 299
AUSTRIA 2.359 3.530 36
MALTA 67 6.010 5
Municipalities comparisonLOCAL REFORM IN
EUROPE & CYPRUS

LOCAL REFORM IN
EUROPE & CYPRUS
Cyprus Municipalities and Communities population fragmentation
228
46
12
66
FRANCE : 57,0 % Municipalities < 500 Inhabitants, 8% of total population
ITALY : 10,5 % Municipalities < 500 Inhabitants, 0,4% of total population
GERMANY: 20,2 % Municipalities < 500 Inhabitants, 0,7% of total population
CYPRUS : 61% Local Entities < 500 Inhabitants, 4,7% of total population
0
50
100
150
200
250
Up to 500 Inhabitants From 500 to 1.000
Inhabitants
From 1.000 to 5.000
Inhabitants
From 5.000 to 10.000
Inhabitants
More than 10.000
Inhabitants
Cyprus Population Fragmentation
18

Local government financing indicators comparison (2012 data)
Central Government: 6.299,8 M€
Local Government: 384,8 M€
Social Security: 1.593,5 M€
From EUROSTAT
4,64% of Total Government Expenditures
LOCAL REFORM IN
EUROPE & CYPRUS

COUNTRY LOCAL GOV-
ENTITIES
QUANTITY No. OF
LAYERS
RESPONSIBILITIES PEOPLE
REPRESENTATIVE
GERMANY
LÄNDER 16
4 - 3
Land government Landtag elected by the citizens
REGIERUNG BEZIRK 19 Auditing and control, supervisioning Not guaranted by the constitution,
nominated by Landtag
LANDKREISE 402 of which:
- 107 Urban
- 295 Rural
Town planning, Road Maintenance,
Welfare, Hospitals, Secondary Schools,
Waste Mgmt., Tourism and economy
development, Car registration,
Sewerage & water board.
Kreistag elected by the citizens
GEMEINDEN 11.292 of which 2.064 towns Building permits, Primary schools,
Road Mgmt., Cultural events
Gemeindrat elected by the citizens
ITALY
REGIONI 20
3
Health system, secondary schools and
Universities, local transportation
Consiglio Regionale elected by the
citizens
PROVINCIE 101 Zoning, local planning, car registration,
road mgmt.
Nominated by the Consiglio
Regionale
COMUNI 8.057 Town planning, building permits, road
mgmt., primary schools, security
Elected by the citizens
FRANCE
REGIONS 27
4
Local transportation, High schools and
universities
DEPARTEMENTS 101 Wellfare, local roads maint., junior
schools
General Council elected by the
citizens
ARRONDISSEMENTS 342 Social housing, local parks, child care,
sport facilities, births & deaths
registration
Counsellors elected by the citizens
CANTONS 4.032 Each canton elects a person to
represent it at the conseil général du
département – or general council for
the department, which is the principal
administrative division of the French
Republic.
Cantonal council elected by the
citizens
COMMUNES 36.681 Town planning, building permits, road
mgmt., primary schools, security
Mayor and council elected by the
citizens
Local administrations structure in EuropeLOCAL REFORM IN
EUROPE & CYPRUS
11

LOCAL
REFORM
% OF
INVOLVED
MUNICIP.
% OF
INVOLVED
INHABIT.
NOTES
GERMANY Municipal
association
15.1% 5,2% Covering: town
planning,
sewerage/water
boards, Cemetery
matters, payment, Fire
brigade
ITALY Mountain
Communities
38,9% 13,5%
Union of
Municipalities
44,4% 14,1% Mandatory for the
municipalities up to
1.000 inhabitants
FRANCE Inter-community 91,7% 86,7% The gov. grant is linked
to the joining to the
municipalities
association
LOCAL REFORM IN
EUROPE & CYPRUS
Local administration reform in Europe: cooperation

No. of
Municipalities
2000
No. of
Municipalities
2014
% of
reduction
NOTE
GERMANY 13.157 11.292 - 14,2 % Association projects in 5
Länder
ITALY 8.101 8.057 - 0,6 % Cooperation projects
FRANCE 36.570 36.681 + 3,0 %
POLAND 2.489 2.478 - 0,4 % Cooperation projects
DENMARK 275 98 - 64,4 %
FINLAND 124 77 - 37,9 % 236 Join Municipality Boards
LITHUANIA 581 56 The government’s orientation
is now to increase the number
of municipalities
NETHERLAND 537 403 - 25,0 %
SPAIN 8.097 8.116 + 0,2 % 1.000 Municipalities are
cooperating together
PORTUGAL 305 308 + 1,0 % 21 municipality associations
GREECE 1.034 325 - 68,6 % The merge produced a cost
increment
LOCAL REFORM IN
EUROPE & CYPRUS
Local administration reform in Europe: consolidation

LOCAL REFORM IN
EUROPE & CYPRUS
Local administration reform in Europe: bottom line
EUROPE APPROACH ON
LOCAL GOVERNMENT REFORM
MUNICIPALITIES CONSOLIDATION
1% - 10% REDUCTION
MUNICIPALITIES COOPERATION
ENFORCED BY LAW
Very strong strategic orientation in every European
countries
Very strong orientation in the northern
European countries
Very week orientation in southern European countries

THE PROBLEM Economic constraints
GDP % YEAR TO
YEAR VARIATION
2010 2011 2012 2013 2014
EU(18) 1,90% 1,60% -0,70% -0,40% 0,83%
CYPRUS -4,80% -5,80% -5,80% -4,90% -3,80%
DEBT AS % OF GDP 2010 2011 2012 2013 2014
EU(18) 83,70% 85,80% 89,00% 90,90% 92,10%
CYPRUS 56,50% 66,00% 79,50% 102,20% 111,70%
DEFICIT AS % OF
GDP
2010 2011 2012 2013 2014
EU(18) -6,10% -4,10% -3,60% -2,90% -2,46%
CYPRUS -4,80% -5,80% -5,80% -4,90% -5,40%
0.00%
20.00%
40.00%
60.00%
80.00%
100.00%
120.00%
2010 2011 2012 2013 2014
Debt Variatio as % of GDP
EU(18) CYPRUS
-7.00%
-6.00%
-5.00%
-4.00%
-3.00%
-2.00%
-1.00%
0.00%
1.00%
2.00%
3.00%
2010 2011 2012 2013 2014
GDP Year to Year % Variation
EU(18) CYPRUS
-8.00%
-6.00%
-4.00%
-2.00%
0.00%
2010 2011 2012 2013 2014
Deficit Variation as % of GDP
EU(18) CYPRUS

0
500
1,000
1,500
2,000
2,500
3,000
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038
Government Debt Maturity Profile
TOT. DEBT MATURITY (M€) Domestic securities & loans Foreign securities & loans
8.600 M€
Time frame 5 Years
TOTAL GOVERNMENT DEBT (Dic 2014): 16.369 M€
1.909 M€
Time frame 5 Years
5.434 M€
Time frame 5 Years
389 M€
Time frame 5 Years
37 M€
Time frame 3 Years

WORST MUNICIPALITIES: 11
NEUTRAL MUNICIPALITIES: 11
GOOD MUNICIPALITIES: 8
18

PILOT PROJECT Finance perspective
€ 2.000.000€ 1.000.000€ 0-€ 1.000.000-€ 2.000.000-€ 3.000.000-€ 4.000.000
500
400
300
200
100
0
balance
Inhabitantsperstaff
Scatterplot of Inhabitants per staff vs balance
average 230 inhabitants per staff
I QuadII Quad
III Quad IV Quad
Eu 28 AVERAGE 39 INHABITANTS PER STAFF
ok
No ok
Ok for people staff
No Ok per balance sheet
Ok for balance sheet
No Ok per people staff
GOOD MUNICIPALITIES: 7
MUNICIPALITIES
TO BE
IMPROVED: 19
BAD MUNICIPALITIES: 4
19

MUNICIPALITY
PROJECT
COMMUNITY
PROJECT
MUNICIPALITY
LOAN
SEWERAGE
BOARD
LOAN TOTAL %
Bank of Cyprus € 26.812.989 € 3.894.199 € 50.856.554 € 59.475 € 81.623.217 16,3%
Co-operative Central Bank € 115.349.236 € 2.758.372 € 92.278.847 € 28.755.389 € 239.141.844 47,9%
KA Finanz AG € 93.997.655 € 33.827.810 € 127.825.465 25,6%
Co-operative Credit Society Lakatamias-Defteras € 566.624 € 295.326 € 861.950 0,2%
National Bank of Greece € 2.114.676 € 2.114.676 0,4%
Regional Co-Operative Society Nicosia € 143.395 € 479.455 € 622.850 0,1%
Co-Operative Savings Society € 94.808 € 94.808 0,0%
Delpha Investment Bank € 504.524 € 126.360 € 630.884 0,1%
C Credit Society Ypsonas € 11.641 € 5.301 € 16.942 0,0%
Alpha Bank € 697.597 € 54.543 € 752.140 0,2%
Hellenic Bank € 226.676 € 1.315.877 € 98.747 € 459.713 € 2.101.013 0,4%
Co-Op. Society Pervolia € 45.548 € 45.548 0,0%
Co-operative Credit Society Tamassou € 445.012 € 1.258.852 € 1.703.864 0,3%
Co-Operative Credit Rural Dev. € 314.313 € 314.313 0,1%
Co-Operative Credit Society Allilegiis € 476.750 € 476.750 0,1%
Co-Operative Savings Limassol € 476.750 € 88.782 € 565.532 0,1%
C Credit Society Xylofagou € 510.434 € 510.434 0,1%
Co-Operative Credit Mesa Geitonia € 262.890 € 262.890 0,1%
Co-Operative Credit Anatolikis € 594.822 € 594.822 0,1%
Co-Op. Credit Society Troodous € 743.554 € 2.928.553 € 3.672.107 0,7%
Co-Op. Credit Society Paphos € 131.181 € 131.181 0,0%
European Investment Bank € 12.107.036 € 12.107.036 2,4%
Council of Europe Development Bank € 20.000.000 € 20.000.000 4,0%
Pireus Bank € 2.855.869 € 2.855.869 0,6%
Co-Operative Credit Society Lefkara € 489.079 € 489.079 0,1%
TOTAL € 240.519.821 € 12.503.700 € 213.029.711 € 33.461.982 € 499.515.214

60% Municipalities respect
EU target on deficit (3%)
- 23% Municipalities respect
EU target on debit (60%)
- 37% Municipalities respect
EU 2014 average on debt (92%)

23
Total Operating Costs: 267.231.288 €
- of which 43,4% Payroll
- of which 1,9% Mayor & Councillors
Total Income: 256.255.853 € ( of which 20% subsidy)
Total annual Interest to pay: 11.726.300 € (500 M€ total debt)
Need for more cooperation between Municipalities
No complete financing and administrative autonomy
Need for more process monitoring and control
No quality goals assignment
No common HR approach
Processes to optimize: Waste collection, Road Maintenance, Building
Permits, Hygiene, Traffic warden
Processes to improve: Green area, Parking Mgmt., HR
Processes to change: Waste Mgmt., Road Lighting
FINANCING PERSPECTIVE
FOR ALL MUNICIPALITIES
IN CYPRUS
GENERAL PERSPECTIVE
FOR ALL
MUNICIPALITIES IN
CYPRUS
PROCESS PERSPECTIVE
FOR ALL MUNICIPALITIES
IN CYPRUS

25
PROPOSALS Reducing public debt when growth is slow
FISCALPOLICY
Taxes increment
New fees
Consolidation
DEBT
G D P
-
-
GROWTH POLICY
Project’s investments
+
MONETARYPOLICY
Inflation
Devaluation
Debt
rescheduling
-
PRIVATIZATION
Assets
selling
Outsourcing
+
-
STRUCTURAL
REFORMS
Labor market
Local Gov. reform
Efficiency/Efficacy
increment
-
Central Gov. reform
- 3,1%
- 3,4%
- 1,6%
+ 2,0%
- 0,4%
+ 0,5%
- 2,5%
IMF estimation
New taxes

OPTIMIZATION
AND
PRODUCTIVITY
IMPROVEMENT
67,8 M€ of total saving
In two years time frame
- 24,5 M€ in the first year
- 43,3 M€ in the second year
CLUSTERING
ADMINISTRATION
COUNCIL
DEBT REDUCTION
70,5 M€ of total saving
In one year time frame
500 M€ debt write off in
10 years
MUNICIPALITIES
CONSOLIDATION
22 Municipalities
- 14 M€ of total saving and 222 people to redeploy
12 Municipalities
- 59 M€ of total saving and1.223 people to redeploy
STEP 1 STEP 2 STEP 3
PROPOSALS Implementation steps
26
Structural Reform
Structural Reform
Monetary Policy
Privatization
Fiscal Policy

CYPRUS DIVISION
IN CLUSTERS
28

CASE A CASE B CASE C CASE D CASE E
No. of Municipalities &
Communities
370 100 70 40 - 50 18 - 23 10 – 12
No. of Urban Clusters 0 10 10 10 5 5
No. of Rural Clusters 0 90 60 30 13 5
Average Land Surface
Urban Cluster
25 sq. Km 25 sq. Km 25 sq. Km 90 sq. Km 100 sq. Km
Average Population
Urban Cluster
40.000 40.000 40.000 110.000 120.000
Average Land Surface
Rural Cluster
60 sq. Km 90 sq. Km 180 sq. Km 400 sq. Km 1.000 sq. Km
Average Population Rural
Cluster
5.000 7.000 15.000 21.500 40.000
Savings 0 16 M€ 18 M€ 25 M€ 36 M€ 43 M€
% of savings regarding
existing Local Gov.
Operating Costs
0% 4% 5% 7% 10% 12%
16 M€
18 M€
25 M€
36 M€
43 M€
FOCUS ON STEP 2 Potential Clustering Scenarios

FOCUS ON STEP 2 Potential Clustering Scenarios
SAVINGS (M€)
SERVICE
ACCESSABILITY
(%)
ECONOMIC RESOURCES
CONCENTRATION. (%)
POP. IDENTITY
PERCEPTION (%)
CASE A 16 80 33 80
CASE B 18 78 34 77
CASE C 25 73 38 60
CASE D 36 56 71 50
CASE E 43 46 80 20
Case D
The best case

Project Name: Local government reorganization and optimization, through the establishment of a cluster between
municipalities, communities and municipalities and communities.
Problem statement: the local government of Cyprus desires to reduce their operational cost and to increase their income
without cutting services or to reduce the citizen’s satisfaction.
Goal statement: The final goal is to establish:
- A new association between the local administrative entities of Cyprus, called CLUSTER.
- A set of best practices, governing the delivering of the services by each cluster
- An organization chart and a set of management rules that will characterize the functioning of the cluster.
- A new vertical grant mechanism for the local entities, called Debt Reduction Fund; having the aim to help the
indebtedness municipalities and communities to write off their debt.
- A new horizontal grant mechanism for the local entities, called Equilization Fund; having the aim to better distribute the
economic resources among the municipalities and the communities.
Project scope: approach the problem through the adoption of the clustering solution that implies to share all the
resources of the entities belonging to the cluster and to define the responsibility matrix among the participants of the
cluster.
The project will late one and a half year and it is made up of three phases:
 Phase 1: three cluster pilot projects identification; CLUSTER 1: only urban municipalities, CLUSTER 2: urban and
rural municipalities and communities, CLUSTER 3: only rural communities
 Phase 2: process mapping and service responsibility matrix definition between the identified local government entities
and the involved Districts.
 Phase 3: cluster’s best practices definition and cluster steering committee identification
 Phase 4: roll out scheduling plan and clustering trade off estimation
 Phase 5: implementation of the designed project and evaluation of the feedbacks
 Phase 6: project’s extention to the other municipalities and communities
FOCUS ON STEP 2 Project’s objective

PROCESSES INVOLVED
Waste management Road maintenance
Public lighting management Parking management
Green area maintenance Hygiene
Building permits Tourism development
Municipal police Administration
ORGANIZATIONS INVOLVED
30 Municipality 340 Communities
5 Districts Sewerage and Water
Boards
Define the best practices that will govern the management of a
cluster entity.
Define the services that can be delivered by the cluster
Define the responsability matrix between the local government
entities, constituiting the cluster, and the District
Define the cluster steering committee and its management rules
SCOPE
FOCUS ON STEP 2 Project ‘s Scope

DISTRICT CLUSTER INHABITANTS No.
MUNIC.
No. COMM. INHAB.
AVERAGE
CLUSTER INHAB.
AVERAGE
NICOSIA RURAL 1 23.322 19 46.146 URBAN: 119.358
RURAL 2 59.196 2 22
RURAL 3 50.482 3 8
RURAL 4 2.697 18
RURAL 5 5.381 7
RURAL 6 5.990 19
URBAN 1 175.954 5
LIMASSOL URBAN 2 159.117 4 1 47.372
RURAL 7 30.080 1 22
RURAL 8 28.628 1 8
RURAL 9 8.337 24
RURAL 10 10.677 44
RURAL: 16.612
LARNAKA URBAN 3 79.475 3 28.843
RURAL 11 29.777 1 8
RURAL 12 21.832 1 12
RURAL 13 5.303 1 14
RURAL 19 7.828 8
FAMAGUSTA RURAL 14 42.353 4 4 42.353
PAPHOS URBAN 4 62.886 2 12 17.800
RURAL 15 5.909 26
RURAL 16 3.523 16
RURAL 17 8.434 1 26
RURAL 18 8.248 1 19
FOCUS ON STEP 2 Proposal on clustering: general overview
33
Could be split in two:
Strovolos-Ayios Dhomedios-Engomi
Nicosia-Aglantzia-Latzia

34
FOCUS ON STEP 2 An hypothesis on clustering: general overview
URBAN CLUSTERS
Average 120.358
No. Mun. 14
No. Com. 13
RURAL CLUSTERS
Average 24.511
No. Mun. 5
No. Com. 93
NICOSIA No. 6 Clusters
Average 19.431
No. Mun. 1
No. Com. 98
LIMASSOL
No. 4 Clusters
Average 16.185
No. Mun. 3
No. Com. 42
LARNAKA
No. 4 Clusters
FAMAGUSTA
No. 1 Clusters
Average 42.353
No. Mun. 4
No. Com. 4
Average 6.529
No. Mun. 2
No. Com. 87
PAPHOS No. 4 Clusters
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
180,000
200,000
NICOSIA LIMASSOL LARNAKA FAMAGUSTA PHASOS
URBAN CLUSTERS
NOMINAL
Target 110.000
Average 120.358
0
5,000
10,000
15,000
20,000
25,000
30,000
35,000
40,000
45,000
NICOSIA LIMASSOL LARNAKA FAMAGUSTA PHASOS
RURAL CLUSTERS
AVERAGE
4 Clusters 1 Cluster
3 Munic.
42 Comm. Target 21.500
Average 16.612
5 Munic. 4 Munic.
1 Comm.
5 Munic. 2 Munic.
12 Comm.
5 Munic.
93 Comm.
6 Clusters 4 Clusters 4 Clusters
1 Munic.
98 Comm.
4 Munic.
4 Comm.
2 Munic.
87 Comm.
No. 4 Clusters
Could be split in two:
URBAN 1: 92.569
URBAN 5: 100.159

35
RURAL 5 URBAN 1 or URBAN 5
RURAL 3
RURAL 2
RURAL 1
RURAL 4
RURAL 6
RURAL14
URBAN 3
RURAL 11
RURAL 12
RURAL 13
RURAL 19
RURAL 7
URBAN 2
RURAL 8
RURAL 10
RURAL 9
URBAN 4
RURAL 15
RURAL 17
RURAL 18
RURAL 16
23 Clusters: 4 Urbans, 19 Rurals
FOCUS ON STEP 2 Clustering Scenarios: an hypothesis

CLUSTER LOCAL ENTITIES INHABITANTS
RURAL 1
Astromeritis 2.307
Peristerona 2.226
Potami 558
Orounta 604
Kato Moni 332
Agia Marina 568
Xyliatos 138
Agios Georgios 26
Niketari 447
Kato Koutrafas 17
Pano Koutrafas 17
Vyzakia 347
Akaki 3.003
Meniko 1.023
Agioi Trimithias 1.529
Palaiometocho 4.145
Kikkinotrimithia 4.070
Mammari 1.592
Deneia 373
TOTAL 23.322
RURAL 2
Agios Ioannis 472
Arediou 1.225
Agrokipia 509
Mistero 860
Malounta 490
Kirou 1.847
Fikardou 15
Lazanias 39
Gourri 196
Agios Epifanios 412
Tseri 7.035
Kato Deftera 2.053
Pano Deftera 2.789
Anageia 1.514
Ergates 1.792
Episkopeia 524
Pera 1.372
Politiko 419
Kampia 475
Analiontas 443
Margi 146
Anthoipole 1.756
Lakatamia 38.306
Kapedes 572
TOTAL 59.196
FOCUS ON STEP 2 Nicosia clustering proposal
36

RURAL 3
Latzia 16.774
Yeri 8.235
Potamia 505
Dali 10.466
Nisou 2.179
Pera Chorio 2.637
Lympia 2.694
Alampra 1.585
Agia Varvara 2.204
Kotsiatis 160
Lythrodontas 3.043
TOTAL 50.482
RURAL 4
Farmakas 480
Kampia 97
Apliki 87
Palaiochori M 686
Palaiochori Op 364
Askas 170
Fterikoudi 90
Alithinou 9
Polystypos 128
Platanistasa 117
Lagoudera 84
Saranti 44
Spilia 104
Kourdali 19
Agia Eirini 27
Livadia 18
Kannavia 129
Saranti 44
TOTAL 2.697
RURAL 5
Kato Pyrgos 1.036
Pano Pyrgos 22
Pigenia 107
Kokkinotrimithia 4.077
Pachiammos 70
Agios Theodoros 49
Mosfieri 20
TOTAL 5.381
37

URBAN 1
Nicosia 55.014
Aglantzia 20.781
Engomi 19.800
Strovolos 67.904
Agios Dhomedios 12.455
TOTAL 175.954
CLUSTER LOCAL ENTITIES INHABITANTS CLUSTER LOCAL ENTITIES INHABITANTS
RURAL 6
Kakopetria 1.274
Galata 581
Sinaoros 228
Kaliana 200
Temvria 498
Evrichou 827
Flasou 240
Agios Epifanios 412
Linou 161
Katydata 114
Agios Georgios 26
Pedoulas 132
Motoullas 174
Oikos 158
Korakou 521
Kalopanagiotis 263
Gerakies 75
Tsakistra 79
Kampos 27
TOTAL 5.990
38

URBAN 2
Pano Polemidia 3.470
Kato Polemidia 22.300
Limassol 101.000
Agios Athanasios 14.347
Mesa Yitonia 18.000
TOTAL 159.117
RURAL 7
Yermasoya 13.421
Mouttaglaka 2.939
Agois Tychon 3.455
Parekklisia 2.738
Amenochori 218
Akrounta 455
Foinikaria 339
Pyrgos 2.363
Moni 622
Monagroulli 536
Pentakomo 644
Asgata 417
Vasa 236
Sanida 42
Arakaoas 307
Sykopetra 120
Eptagoneia 353
Dierona 192
Prastio 346
Kelfaki 299
Klonari 18
Vikla 0
Akapnou 20
TOTAL 30.080
RURAL 8
Sotira 143
Kantou 349
Episkopi 3.681
Erimi 2.432
Kolossi 5.651
Tserkezoi 50
Akrotiri 882
Trachoni 3.940
Ypsonas 11.500
TOTAL 28.628
FOCUS ON STEP 2 Limassol clustering proposal
39

RURAL 9
Palodeia 1.568
Fasoula 560
Paramytha 569
Spitali 316
Mathikoloni 174
Apisiou 208
Apesia 494
Gerasa 69
Limnatis 314
Kapileio 34
Agios Mamas 114
Louvaras 363
Kalo Chono 497
Zoopigi 140
Agios Pavios 135
Agios Kostantinos 137
Kato Mylos 50
Agios Ionnis 339
Agios Theodoros 65
Pelendri 1.074
Potamitissa 62
Dymes 165
Agridia 104
Agros 806
TOTAL 8.357
RURAL 10
Alassa 282
Monagri 175
Agios Georgios 111
Doros 35
Laneia 281
Lofou 46
Silikou 135
Trimiklini 327
Kouka 27
Pera Pedi 120
Moniatis 275
Koilani 216
Pano Piatres 232
Amiantos 228
Palaiomylos 20
Prodromos 123
Agios Dimitrios 54
Kaminaria 44
Treis Elies 25
Mylikouri 17
Lemithou 88
Foinikaria 391
Kato Platres 148
Pissouri 1.819
Avdimou 535
Paramali 227
Platanisteia 45
Alektora 64
Prastio 376
Agios Thomas 50
Anogyra 301
Zanakia-Souni 837
Pano Kivides 707
Agios Amvrosios 323
Pachna 865
Agios Therapon 125
Dora 145
Kissousa 6
Malia 64
Gerovasa 0
Potamiou 36
Vouni 149
Omodos 322
Arsos 281
TOTAL 10.677
FOCUS ON STEP 2 Limassol clustering proposal
40

FOCUS ON STEP 2 Larnaka clustering proposal
URBAN 3
Larnaka 53.247
Livadia 7.000
Aradippou 19.228
TOTAL 79.475
RURAL 11
Athienou 5.017
Avdellero 218
Troulloi 1.175
Kellia 387
Oroklini 6.134
Pyla 2.771
Xylotymvou 3.655
Ormideia 4.189
Xylotymvou 6.231
TOTAL 29.777
RURAL 12
Dromolaxia-Meneou 6.800
Kiti 4.252
Perivolia 3.009
Tersefanou 1.299
Alethriko 1.101
Kivisili 233
Anglisides 1.146
Menogeia 50
Agios Theodoros 663
Mazotos 832
Kofinou 1.312
Alaminos 345
Anafotida 790
TOTAL 21.832
RURAL 13
Zygi 589
Mari 158
Maroni 715
Psematismenos 266
Kalavasos 737
Tochini 424
Skarinou 393
Chorokoitia 632
Kato Drys 129
Lefkara 762
Vavla 52
Lageia 28
Ora 206
Agio Vavatsinias 131
Vavatsinia 81
TOTAL 5.303
41

FOCUS ON STEP 2 Famagusta clustering proposal
CLUSTER COMMUNITIES INHABITANTS
RURAL 14
Augorou 4.604
Liopetri 4.591
Sotira 5.500
Agia Napa 3.212
Paralimni 14.959
Derigna 5.844
Acheritou 1.556
Achna 2.087
TOTAL 42.353
42

RURAL 15
Mandria 893
Kouklia 892
Nikoleia 121
Pano Aarchimandrita 45
Mousere 0
Kidasi 11
Kedares 80
Praitori 23
Agios Nikolaos 61
Filousa 46
Agios Ioannis 29
Mesana 31
Salamiou 265
Kelokedara 193
Trachypedoula 64
Agios Georgios 101
Stavrokonnou 56
Fasoula 56
Anarita 876
Agia Varvara 172
Acheleia 137
Nata 181
Timi 1.220
Choletria 264
Prastio 8
Armino 84
TOTAL 5.909
URBAN 4
Agio Marinouda 266
Geroskipou 7.878
Paphos 32.892
Konia 2.209
Marathounta 309
Armou 600
Mesa Chorio 586
Mesogi 1.689
Trimithousa 1.041
Tala 2.695
Kissonerga 2.004
Lempa 506
Empa 4.855
Chlorakas 5.356
TOTAL 62.886
FOCUS ON STEP 2 Paphos clustering proposal
43

RURAL 16
Koli 466
Tsada 1.043
Episkopi 220
Axylou 61
Eledio 44
Agia Marina 37
Pentalia 63
Galataria 56
Koilineia 39
Vretsia 269
Stratos-Agios Fotios 243
Lemona 51
Choulou 147
Letymou 249
Amargeti 209
Kallepeia 326
TOTAL 3.523
RURAL 17
Pegeia 3.953
Akoursos 22
Stroumpi 540
Polemi 840
Psathi 110
Agios Dimitrianos 91
Kannaviou 175
Asprogia 60
Mamountali 51
Kritou Marottou 84
Anadiou 17
Lasa 150
Drymou 110
Simou 185
Miliou 89
Pano Akourdaileia 44
Kato Akourdaileia 65
Kritou Tera 86
Tera 36
Drouseia 405
Ineia 385
Kato Arodes 39
Pano Arodes 135
Kathikas 438
Thrinia 55
Theletra 269
TOTAL 8.434
44

RURAL 18
Androlikou 34
Neo Chorio 519
Choli 83
Goudi 204
Chrysochou 132
Prodromi 519
Polis 3.329
Pelothousa 57
Steni 173
Skouli 65
Peristerona 302
Meladeia 14
Lysos 205
Kynousa 71
Makaounta 116
Argaka 1.078
Galia 202
Agia Marina 647
Nea Dimmata 50
Promos 448
TOTAL 8.248
45

LAW ON CLUSTER: the Central Government defines a three years moratorium in which all the municipalities and the
communities can voluntary join a cluster, following the defined framework; after this time frame the joining will be compulsory
and all the local entities should follow the same rules. During the moratorium time, all the local entities budgets must be
monitored and controlled to avoid unconditionally expenses. The cluster framework is:
1. The cluster steering committe management rule, also valid in the voluntary period
2. The services to be delivered, when the compulsory approach will take place
3. The geographic cluster profile (with whom a local entity must be associated to), set by the central government in
accordance with the local entities.
CITIZENS: they elect the mayor and the related councilors as usual; no change in the today law is needed.
CLUSTER COUNCIL: to this assembly the elected councilors in each local entities can participate by following this
representative metric rule:
- For local entities > 10% of total cluster population: 1 fixed counselor from opposition for each local entity
- For local entities until 10% of total cluster population: 1 counselor from majority party for each local entity
- For local entities until 20% of total cluster population: 2 counselors from majority party for each local entity
- For local entities from 20% to 40% of total cluster population: 3 counselors from majority party for each local entity
- For local entity > 70% of total cluster population: 5 counselors from majority party for each local entity
The responsibility of the Cluster Council is to approve the decision taken by the Committee, to monitor and to control the
actions of the Chef Executive Office, responsible for managing the operational activities of the cluster in according to the
strategies set by the Committee.
The Cluster Council will be summoned at least every month, by the President of the Committee. No additional salary
compensation for the councilors is foreseen.
FOCUS ON STEP2
Cluster organization
Cluster’s management main pillars

COMMITTEE: this assembly is made up of each single elected mayor of the local entities belonging to that cluster. This case
is valid when the number of local entities forming the cluster is less than 12. For clusters with a higher number of
municipalities and communities, the representative of the mayors into the Junta will follow a rotation process, renewable
every year.
In both cases, the maximum number of seats in the Committee is 11; 10 ordinary seats plus the president. The President
will be elected by the Committee and he will be in charge for five years, on the other end, according to the rotation process,
every representative in the Committee will be in charge only one year.
This rotation method has been set to render the decision process of this organ more efficient and effective.
The Junta responsibilities are:
1. Define the services to be delivered by the cluster
2. Set the strategies for the correct function of the cluster
3. Appoint the Chief Executive Office and the auditor
4. Monitor and control the actions of the CEO, through the auditor or directly
5. Prepare procedures, directions and reports to be approved by the Cluster Council
No salary compensation for the mayors, belonging to the Committee, is foreseen.
PRESIDENT OF THE COMMITTEE: He represents the cluster in every official and unofficial events, he summons the Junta
and the Cluster Council, he sign the bills to be approved by the Cluster Council and he has vote right inside the Junta. He
will be elected during the first Junta meeting and he will be in charge for five years.
No salary compensation for the Committee President is foreseen.
FOCUS ON STEP2

CHIEF EXECUTIVE OFFICE: this is a general manager, responsible for organizing and managing the cluster’s operations in
accordance to the service delivery strategies set by the Junta and approved by the Cluster Council.
Based on the received budget by the Committee, he have to structure the service delivery organization following the normal
business rules.
He will receive a three year contract, renewable with an early way out triggered by both parties. For his duties he will receive
a salary compensation, wich amount will be decided by the Junta and in accordance to the salary standards of the Cyprus
Pubblic sector. A variable payment will be considered; this will be linked to the achievement of the objectives.
He can hire and fire people, following the rules valid for the Cyprus Public sector; moreover, for the new hired emeployees
they can receive a different contract more closed to the private sector framework. This contracts should be more tuned to the
efficiency and efficancy of the results. The CEO, in his operational cluster organization, depending on the kind of services to
deliver, must employee the today local entities staff assigned to the same service. He has the freedom to modify the existing
delivery organization and to move people from one sector to another.
He will regulary report on the cluster delivered activies, the Committee and the Cluster Council every month. He must
provide all the answers to the questions raised by the Cluster’s management boards.I
AUDITOR: He represents the interest of the citizens living in the cluster; his duties is to monitor and control, independently,
the activities delivered by the operation branch of the cluster, managed by the CEO, to verify the adherence of the actions to
the strategy set by the Committee and approved by the Cluster Council and to verify the quality service level of the delivered
service with the citizens by adopting regular customer satisfaction.
The Junta is responsible for appointing the Auditor, he will receive a salary compensation, in accordance to the Cyprus
salary rules of the Public sector. He will be in charge for five years.
FOCUS ON STEP2

CLUSTER COUNCILCLUSTER COUNCIL
CLUSTER COMMITTEE
CLUSTER OPERATION CEO
CLUSTER AUDITORCounselors
Counselors
Counselors
Mayor
Mayor
Mayor
Nomination
Nomination
FOCUS ON STEP 2
cluster organization
Steering Committee for clusters with less than 12 associated local entities
MUNICIPALITIES and COMMUNITIES
Max 10 people + president
50

CLUSTER COUNCILCLUSTER COUNCIL
CLUSTER COMMITTEE
CLUSTER OPERATION CEO
CLUSTER AUDITORCounselors
Counselors
Counselors
Mayor
Mayor
Mayor
Nomination
Nomination
FOCUS ON STEP 2
Steering Committee for clusters with higher than 11 associated local
entities
MUNICIPALITIES and COMMUNITIES
Max 10 people + president
RAPPRESENTATIVE
PROCESS ROTATION
Every year, the mayors of the local entities,
belonging to the cluster, define 10 rappresentatives
to join the Junta or apply the rotation mechanism.
The President is in charge for 5 years
51
Mauro Giorgini

MUNICIPALITIES
COMMUNITIES
COUNCIL
COMMITTEE
CLUSTER GOVERNING CLUSTER MANAGING
Mayor 1
Mayor 2
Mayor n
Counselors
Counselors
Approval
process
Strategic directions,
Dispositions
Approving,
Check & balance
Parking Management
GENERALDIRECTOR
Standard
operating
activities
Development
activities
Control
Monitoring
Reporting
Waste Management
Green Area
Financing accounting and
Tax management
Town Plan and Buiding
Permits
Hygiene
School Board
Municipality Police
Road Management
Cultural Events
Strategic directions
Monitor & Control
- For local entities > 10% of total cluster population: 1 fixed counselor from opposition for each local entity
- For local entities until 10% of total cluster population: 1 counselor from majority party for each local entity
- For local entities until 20% of total cluster population: 2 counselors from majority party for each local entity
- For local entity > 70% of total cluster population: 5 counselors from majority party for each local entity
One mayor for each local entity joining the cluster
FOCUS ON STEP 2
Steering Committee for clusters: details
52
Mauro Giorgini

Municipality A
1 M€
22%
1,5 M€
33%
2 M€
45%
Service Municipality operating costs
Costs reduction due to:
- economy of scale and
productivity improvement
- process optimization
- Outsourcing model adoption
Municipality A: 22% * 3 M€ = 0,66 M€
Municipality B: 33% * 3 M€ = 1 M€
Municipality C: 45% * 3 M€ = 1,35 M€
Operating costs distribution
Municipality B Municipality C
Ex post
Service operating costs
Operating costs ripartition in a Cluster
4,5 M€
3 M€
Ex ante
Service operating costs
FOCUS ON STEP 2

Municipality A
450 K€
33% Municipality service income
Municipality A: 33% * 2 M€ = 660 K€
Municipality B: 17% * 2 M€ = 340 K€
Municipality C: 50% * 2 M€ = 1,000 K€
Income distribution
Municipality B Municipality C
2 M€
Ex post
Service income
Income ripartition in a Cluster
225 K€
17%
675 K€
50%
1,35 M€
Ex ante
Service income
Income increment due to:
- economy of scale and
productivity improvement
- process optimization
FOCUS ON STEP 2

PROCESSES INVOLVED
Budgeting Early warning on indebetenes
Grant mechanisms Purchasing and payment
Finance monitor and control Financing
ORGANIZATIONS INVOLVED
30 Municipality 340 Communities
5 Districts Sewerage and Water
Boards
Write off the existing local entities debt in 10 years from the kick off
project date.
Define a new Central Government grant mechanism to support the
budgets of the local administrations. Vertical compensation.
Define an horizontal compensation among the local entities to cover
the gap between the richest and the poorest.
Establish in each District, an independent agency, called
Administrative Council, responsible for monitoring, controlling and
giving advices to the local administrations on the economic matters.
SCOPE
FOCUS ON STEP 2
Debt Reduction
Project ‘s Scope

CENTRAL GOVERNMENT
LOCAL
GOVERNMENT
TODAY
Grant
Poor Rich
TOMORROW
CENTRAL GOVERNMENTGrant
LOCAL GOVERNMENT
Rich Poor
Debt
Reduction
Fund
Debt
Reduction
Fund
Equalization Fund
Vertical support
Horizontal support
FOCUS ON STEP 2
Debt Reduction
Vertical and horizontal grant mechanism
Mauro Giorgini
57
86 M€ to Municipalities
11 M€ to Communities

DEBT REDUCTION FUND
CENTRAL
GOVERNMENT
LOCAL
GOVERNMENT
• Debt service aid
• Aid to pay off accumulated debt
• Additional help with debt repayment
• Cutting expenditures and increase
revenues through process optimization
and clustering
• Balance the budget
• Payoff debts
DEBT CONSOLIDATION AND BALANCED BUDGET
Ten Years Ten Years
FOCUS ON STEP 2
Debt Reduction
Vertical grant mechanism: debt reduction fund
Mauro Giorgini
58

59
ASSUMPTIONS
10%
€11.720.300
2,35%
5%
ANNUALSTREAMLINE
1 €499.515.214 €11.720.300 €111.623.343 €74.927.282 €36.696.061
2 €387.891.871 €9.101.243 €86.679.617 €58.183.781 €28.495.836
3 €301.212.254 7.067.448 €67.309.899 €45.181.838 €22.128.061
4 €233.902.355 5.488.133 €52.268.604 €35.085.353 €17.183.250
5 €181.633.751 4.261.736 €40.588.486 €27.245.063 €13.343.424
6 €141.045.265 3.309.394 €31.518.447 €21.156.790 €10.361.658
7 €109.526.818 2.569.866 €24.475.230 €16.429.023 €8.046.207
8 €85.051.588 1.995.595 €19.005.913 €12.757.738 €6.248.175
9 €66.045.675 1.549.653 €14.758.788 €9.906.851 €4.851.937
10 €51.286.888 1.203.362 €11.460.740 €7.693.033 €3.767.707
€39.826.148
ANNUALLOCAL
GOV. SUPPORT
Total annual interest paid
Additional capital write off from Munic.
Annual standard capital write off %
ANNUALCEN.
GOV. SUPP.
Annual interest rate paid by
Central Gov.
Annual interest rate ammount
used by Municipalities to
write off loan capital
10% Total debt yearly written
off by Central Gov.
For any additional €written
off by municipalities another
€will be added by Central
Gov.
Total Municipalities debt €499.515.214
DEBTREDUCTION
FUND
YEAR CAPITAL INTERESTPAID
WRITEOFF
CAPITAL
FOCUS ON STEP 2
Debt Reduction
Vertical grant mechanism: debt reduction fund

60
FOCUS ON STEP 2
Debt Reduction
Horizontal grant mechanism: equalization fund
contribution

61
FOCUS ON STEP 2
Debt Reduction
Horizontal grant mechanism: equalization fund
distribution

62
FOCUS ON STEP 2
Debt Reduction
Horizontal grant mechanism: municipalities ranking
MUNICIPALITY
GEOGRAPHY ROAD NETWORK POPULATION SURFACE CHARACTERISTICS
GEOPOLITICAL
RANKINGMountain Rural Seaside Urban High Density>155 Medium Den. 36-155 Low Density<36 High>60.000
Medium
20.000-60.000
Low <20.000 High >31
Medium 13 -
31
Low <13 Infrastructure
Ind/Comm
>1.200
Historical >12
Educational>3
1
touristics >20 Buffer Zone Militar Base
0,1 0,05 -0,05 -0,1 -0,1 0 0,1 -0,1 0 0,1 0,1 0 -0,1 -0,02
-0,05
-0,01 -0,02 -0,1 0,07 0,03
NICOSIA
-0,1 -0,1 -0,02 -0,05 -0,01 -0,02 -0,1 0,07 0 -0,33
STROVOLOS
-0,1 -0,1 -0,1 -0,02 -0,05 0 -0,02 0 0 0 -0,39
AYIOS DHOMETIOS
-0,1 -0,1 0,1 -0,1 0 0 0 0 0,07 0 -0,13
AGLANTZIA
-0,1 0 0,1 0 0 -0,02 0 0,07 0 0,05
LAKATAMIA
-0,1 -0,1 0 0 -0,05 0 0 0 0 0 -0,25
LATSIA
-0,1 0,1 0 0 0 0 0 0 0
ENGOMI
-0,1 0,1 -0,1 0 0 0 -0,1 0,07 0 -0,13
IDALION
0,05 0,1 0 0 0 0 0 0 0,15
YERI
0,05 0,1 0,1 0 0 0 0 0 0 0,25
TSERI
0,05 0,1 0 0 0 0 0 0 0,15
LIMASSOL
-0,05 -0,1 -0,1 0,1 -0,02 -0,05 0 -0,02 -0,1 0 0 -0,34
MESA YITONIA
0,1 0,1 -0,1 0 0 0 0 0 0 0,1
AYIOS ATHANASIOS
-0,1 0,1 0 0 0 0 0 0 0
KATO POLEMIDIA
-0,1 0 0 0 0 0 0 -0,1
YERMASOYIA
-0,05 0,1 0,1 0 0 0 -0,1 0 0 0,05
IPSONAS
-0,1 0 0 0 0 0 0 -0,1
LARNAKA
-0,05 -0,1 -0,1 -0,02 -0,05 -0,01 -0,02 0 0 0 -0,35
ARADIPPOU
-0,1 -0,1 0,1 0,1 0 -0,01 0 0 0 0 -0,01
ATHIENOU
0,05 0,1 0 0 0 0 0,07 0 0,22
LEFKARA
0,05 0,1 0,1 0,1 -0,02 0 0 0 0 0 0 0,33
LIVADIA
0,05 0,1 0,1 -0,1 0 0 0 0 0 0 0,15
DROM.MENEOU
0,05 0,1 0,1 -0,1 -0,02 0 0 0 0 0 0 0,13
PAFOS
-0,05 0,1 -0,1 -0,05 -0,01 -0,02 -0,1 0 0 -0,23
POLIS CHRYSOCHOUS
-0,05 0,1 0,1 0,1 0 0 0 -0,1 0 0 0,15
GEROSKIPOU
-0,05 0,1 0,1 0 0 0 -0,1 0 0 0,05
PEYIA
-0,05 0,1 0,1 0 -0,01 0 -0,1 0 0 0,04
SOTIRA
-0,05 0,1 0 -0,01 0 0 0 0 0,04
PARALIMNI
-0,05 0,1 -0,1 -0,05 0 -0,02 -0,1 0 0 -0,22
AGIA NAPA
-0,05 0,1 -0,1 0 -0,01 0 -0,1 0 0 -0,16
DERYNEIA
0,05 0,1 0 0 0 0 0,07 0 0,22

ORGANIZATION: in every Distric it will be established a new central administrative organization called, Administrative
Council. The staff, associated to this structure, is made up from the today District employees.
RESPONSIBILITY: n the Administrative Council has the duty to support the local entities of its District on the economic
matters, to be a communication facilitator vehicle between the local entities and the central administration and to
synchronize and to standardize, across the Distric, of the actions and of the procedures related to the services delivered by
the local entities. More precisely, the responsibilities of the Administration Council are:
• Monitor and control the indebtedness level of the local entities, through an Early Warning System
• Support the local entities on the economic matters and on other specific fields
• Standardize the purchasing process by setting a class of goods to acquire and a related target standard price.
• Central Human Resources for the local entities; the appraisals process and the workload attribution to the staffs are
covered directly by the local entities theirself.
• Tourism and industry/commercial development
• Sewerage and water boards
• Monitor the delivery of the services from the local entities, assuring the citizens that the services respect the law and a
standardized quality level.
DISTRICT: with the establishment of the clusters and of the Administrative Council, the District side, that supports the
communities and that performs some activities for the municipalities, like hygiene, can be cancelled. The today employees
can be transferred either to the Administrative Council, or to the Clusters. All the activities that today the District conducts on
behalf of the municipalities and of the communities, will be transferred to the clusters.
Administrative Council: organization & structure
FOCUS ON STEP 2
Administrative Council

MUNICIPALITIES
COMMUNITIES
DISTRICT
SUPERVISORY AUTHORITY
EARLY WARNING SYSTEM
STATE COMMISSIONER
ADMINISTRATIVE COUNCIL
Monitor & Control
Monitor & Control
Anticipates Problems
Anticipates Problems
Takes Control and Sanctions
Takes Control and Sanctions
FOCUS ON STEP 2
Administrative Council
Relationships: Adm. Council – Local Entities
Mauro Giorgini
65

SETTING UP PILOT PROJECTS: three clusters will be identified for the project start up. The characteristics of these
clusters are: one urban, with only municipalities, one rural, with only communities and one mixed with municipalities and
communities. Based on the present cluster’s list, the cluster chosen as project’s test drivers are:
1. In Nicosia District: Cluster RURAL 6 with 19 communities and with a total population of 5.990 inhabitants
2. In Limassol District: Cluster RURAL 8, with 1 municipality, 8 communities and with a total 28.629 inhabitants
3. In Nicosia District: Cluster URBAN 1+ Latzia, with 6 municipality and with a total 231.034 inhabitants.
PROCESSES AND PROCEDURES SURVAY: in each identified cluster, will be identified an catalogued per service
typology, all the existing procedures governing the actual services delivery. In addition it will be conduct the same survey in
the Districts, to identify the kind of supports dedicated to the local entities and the related workload.
BEST PRACTICES IDENTIFICATION: after having collected all the procedures, used in each municipality/community
involved in the project test driver to deliver the services, an analysis will be executed, with the objective to identify the best
practices for each service typology. In addition it will be set, in conjunction with the central government, the procedures that
the Administrative Council will use to monitor and control the budgets of the local entities.
CLUSTER ORGANIZATION SETTING UP: according to the general government rules on how to manage a cluster, the
implementation procedures will be set up, as for example the following documentations: organization chart, responsibility
matrix, steering committee operational procedures, people knowledge profile.
ROLL OUT PLAN: definition of an implementation project plan, having the objective to implement the cluster in the three
test drivers.
CLUSTER IMPLEMENTATION IN THE THREE TEST DRIVERS: according to the Roll Out Plan, the cluster will be
implemented in the three identified test drivers.
FEEDBACKS ANALYSIS AND PLAN REASSESSMENT: based on the experiences done with the test drivers, the related
feedbacks will be analyzed and the general roll out plan will be modified accordingly.
GENERAL PROJECT IMPLEMENTATION: the general plan will be implemented to extend the cluster approach throughout
CLUSTERING
IMPLEMENTATION
Project’s organization

GO
Test Drivers setting up
1 Quarter
1 year 2 year 3 year 4 year
Procedures Survay
Analysis
Best Practices
identification
Cluster Governance
Setting up
Phase1
CLUSTERDESIGN
Roll Out Plan definition
General implementation
and setting the
Adminstrative Council
Feedbacks analysis
andGeneral Roll
Out Plan definition
Cluster implementation
In the Test Drivers
2 Quarter 3 Quarter 4 Quarter 1 Quarter 2 Quarter 3 Quarter 4 Quarter 1 Quarter 2 Quarter 3 Quarter 4 Quarter 1 Quarter 2 Quarter
Phase3
IMPLEMENT.
CLUSTER
IMPLEMENTATION
Scheduling
Phase2
TESTDRIVERS

Project’s governance
Project’s structure
- Every Municipality has to assign one person to be fully dedicated to the project
- Every Community has to assign one focal point to use as interface
Municipalities & Communities
Notoria International staff
CLUSTER
IMPLEMENTATION
Project’s team

Project’s documentation (in English and in Greek)
 Phase 1:
 The procedures and the processes today in use
 The best practices divided per services
 The cluster management rules
 Organization chart
 Responsibility Matrix
 Steering Committee procedures
 The Test Drivers Roll Out plan
 Phase 2:
 Implementation report every week with
 Performed activities
 Planned activities
 Problems raised
 Actions to be taken
 Final implementation report with Pros and Cons
 General Roll Out plan
 Phase 3:
 Implementation report every week
 Final implementation report with Pros and Cons
CLUSTER
IMPLEMENTATION
Project’s deliverables

Clustering general-presentation (Project Cyprus Part III)

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