The cost of the Paphos-Polis highway‘s first phase has escalated to 90 million euros from the original 73 million euros following a contract termination, the parliament heard today.
The total cost to taxpayers could reach 104.4 million euros, accounting for 14.4 million euros already paid to the previous contractor, who is now seeking 35 million euros in compensation through legal proceedings.
Transport Minister Alexis Vafeades estimated the entire highway project would cost around 320 million euros, though former Auditor General Odysseas Michaelides suggested the final figure could be substantially higher.
The state failed to seize the contractor’s performance guarantee after courts ruled that authorities had not properly notified the construction company of their intention to terminate the contract.
Michaelides expressed concerns about both the project’s financial management and safety design, whilst the state plans to file counterclaims against the contractor.
The government has retained 1.4 million euros, representing 10 percent of the 16 million euros worth of work completed before the termination.
The final highway design will feature four traffic lanes and will be implemented according to legal requirements, Vafeades told the committee.
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