Municipalities of Gortyna, Salamina declare bankruptcy

The Municipality of Gortyna in the Cretan prefecture of Iraklio has declared bankruptcy and is to enter a “reform program” that comprises a redoubling of efforts to collect outstanding debts to local authorities while freezing staff recruitments.

The decision to put Gortyna into the special program was taken by Deputy Interior Minister Yiannis Balafas.

It followed the induction of the Municipality of Salamina, an island off the coast of Piraeus, into the same program last month.

In both cases, municipal authorities will be prohibited from hiring staff while the program also foresees an increase in property taxes at the higher end of the scale.