With 22+1 truths, the faction of Kostas Bakoyannis “Athens Up” provides information on the mammoth loan received by the administration of Haris Doukas, as—as it notes— “the people of Athens have a right to know.”
According to a statement from the political faction, the 75-million-euro loan, which the Douka Municipal Authority is proceeding to take out suddenly and unjustifiably, is larger than the total current outstanding debt of the Municipality of Athens and, as noted, “will financially bind the Municipality until 2046, affecting not only the current administration but also future municipal terms.”
The energy upgrade of schools cited by the Douka Administration, according to the faction, is a pretext. The truth is “the administration’s incompetence and support for the mayor’s political ambitions.”
“No one disputes the need for better schools, the energy retrofitting of buildings, and the challenges of the climate crisis. For this reason, after all, during the previous term, over 50 million euros were invested, without the Municipality borrowing a single cent. Today, however, the City of Athens has 14 million euros available for schools, which, for some inexplicable reason, are not being utilized,” notes Kostas Bakoyannis’s political faction.
With the central message that “Athenians have a right to know the whole truth,” “Athens Up” sets out what is actually true:
Truth 1
This is the most important financial decision of this term
It is not a decision regarding a construction contract, nor a procurement. Nor is it even a budget revision.
This is a new loan of 75 million euros and a decision that will remain in effect until 2046, affecting municipal budgets for two decades.
This decision will affect future generations of Athenians.
And that is why this responsibility is far greater than any other.
Fact 2
Athens invested in schools, without burdening the city with new debt
The previous municipal administration recognized the problem with school infrastructure from the very beginning. And decided to drastically increase funding for schools. Without saddling the city with 75 million euros.
In total, we put out to bid projects worth approximately 57.1 million euros. And there is one more crucial point: the current administration inherited active construction projects, active contracts, and uncompleted project balances.
Fact 3
A historic decision is being rushed through
The biggest financial decision of the term has arrived:
• with an emergency Municipal Committee
• without substantive public consultation
• without a special session on the financial data
• without sufficient time for review
The bigger the decision, the more extensive the consultation must be. Here, the exact opposite happened.
Fact 4
A blank check is being requested
The proposal does not provide an exhaustive analysis of the loan. It does not thoroughly analyze the projects.
• Which schools?
• Which projects?
• At what cost?
• What are the priorities?
• What is the timeline?
We know almost everything about the loan. We know almost nothing about the investment program.
Fact 5
The process is backwards
The correct order is:
First the projects. Then the budget. Then the alternative financing options. Then the financial assessment. And finally, the loan.
Today, exactly the opposite is happening.
Fact 6
The Municipality is increasing its liabilities without presenting a rationalization plan
With the new loan:
• liabilities increase
• interest increases
• installments increase
• dependence on borrowing increases
However, the following are not presented:
• a plan to streamline spending
• a plan to reduce operating costs
• a plan to increase productivity
• a financial resilience plan
Fact 7
The Municipality is becoming financially weaker and borrowing more
There is one question that remains unanswered.
Why is such a large new loan being taken out today, at a time when the Municipality’s key financial indicators are deteriorating?
It is widely accepted that the municipality’s expenses will increase further due to inflationary trends. Let’s look at the data.
From 2023 to 2025:
• the municipality’s total revenue will decrease from approximately 565 million euros to approximately 489 million euros, representing a decrease of approximately 75.5 million euros, or 13.4%.
• Cash reserves will decrease from approximately 47 million euros to approximately 35 million euros, meaning a loss of approximately 12 million euros in liquidity.
At the same time: operating expenses are increasing, personnel expenses are increasing, and debt service expenses are increasing.
And most concerning:
The municipality’s investment expenditures are decreasing from approximately 130 million euros in 2023 to approximately 54 million euros in 2025. A decrease of nearly 59%.
In other words, revenues are falling, available funds are falling, investments are falling, and expenses are rising. And the administration’s response is to borrow more. This is not a sign of financial strength. It is a sign of the Municipality’s shrinking fiscal flexibility.
Fact 8
The EIB’s own criteria raise questions
The European Investment Bank does not only examine whether a project is useful. It also examines whether the borrower has the ability to repay the loan.
That is why it examines:
• revenue stability
• liquidity
• collectability
• the debt-to-income ratio
• existing loan obligations
• the overall financial picture
And this raises a reasonable question: When revenues are declining, when cash reserves are dwindling, when collection rates remain at a mere 2.5%, and when the Municipality is seeking a new loan larger than its entire current debt, what exactly is the evidence that this new financial burden is fully compatible with the Municipality’s long-term financial sustainability?
Fact 9
The new loan is larger than the Municipality’s entire current debt
Today, the total outstanding balance of all the City of Athens’ loans amounts to approximately 65 million euros. The administration is requesting a new loan of 75 million euros. That is, a loan larger than the total current debt.
With a single decision:
• the debt goes from 65 million euros to approximately 140 million euros
• total borrowing increases by approximately 115%
• the city’s debt obligations more than double
This is the true magnitude of the decision.
Fact 10
The annual cost of servicing the debt is rising sharply
Today, the Municipality pays approximately 10 million euros per year.
With the new loan, the amount is estimated to reach 16 to 17 million euros.
More money in installments. Less money for the city.
Truth 11
Someone will foot the bill
When interest rates rise, installments, and obligations, there are only three options: increase revenue, cut spending, or take on new debt.
We see no plan to increase revenue. We see no plan to cut spending.
So a simple question arises: Who will foot the bill?
Because the installments will be paid. The interest will be paid. The question is how and by whom. Either through increases in municipal fees. Or through fewer services. Or through new borrowing. There is no fourth option.
Fact 12
We do not know the actual total cost
We are not just voting on 75 million euros.
We are voting on:
• interest
• financial charges
• guarantee costs
• total repayment by 2046
What is the final cost the city will pay?
Fact 13
Future administrations will pay for today’s decisions
The loan runs until 2046.The current administration won’t be here when it expires.
Future administrations will pay for today’s decisions.
The longer the time commitment, the greater the accountability must be.
Fact 14
The Municipality has a serious collection problem
The Municipality’s total receivables amount to approximately 513.8 million euros. Of these, 391.5 million euros are classified as uncollectible or slow-moving.
In 2024, receivables amounted to 439.5 million euros, and actual collections were approximately 11 million euros.
That is, a collection rate of approximately 2.5%.
Fact 15
The new loan is nearly seven times larger than what the Municipality collects each year
Annual collections from old debts are approximately 10–11 million euros. The new loan is 75 million euros. Almost seven times larger.
Where is the plan to increase collectability?
Truth 16
The certified auditor warns
The auditor points out a potential additional impairment of approximately 191.5 million euros. An amount more than double the new loan.
If the more conservative estimate is confirmed, the Municipality’s net receivables will decrease dramatically. The balance sheet picture deteriorates significantly. This is not a political opinion. It is a warning from the certified auditor.
Fact 17
There are already 14 million euros in European funds for schools
The OCE “Athens 2030” already allocates approximately 14 million euros for school infrastructure.
This project was already mature, already eligible, and already funded.
Why wasn’t the remaining funding gap covered by other European sources?
Truth 18
It was not proven that all alternatives had been exhausted
There is the Modernisation Fund. There are European grants as well as blended finance schemes.
Where is the comparative assessment? Why is a loan the first solution?
Fact 19
There is no comprehensive business plan
The EIB requires a business plan. Where is it?
How much energy will be saved? How much will bills be reduced? How much will emissions be reduced? What is the payback period? What is the financial return?
Good intentions are not enough. Documentation is required.
Truth 20
We do not know why the first disbursement of 22.5 million euros is needed immediately
Which projects are ready today? Which ones are being put out to tender immediately? Which ones justify the disbursement of 30% of the loan? If there are ready projects, let’s see them. If there aren’t any, why is immediate disbursement necessary?
Is immediate liquidity required? Is there a problem that you aren’t telling us about, even though we’ve been pointing it out for a very long time?
Truth 21
The debt is growing faster than the municipality’s financial resilience
Data on borrowing trends show that the previous municipal administration pursued a policy of gradually reducing debt, while simultaneously securing over 500 million euros in funding from European and national sources.
The total loan balance fell from €100.5 million in 2019 to €87.6 million in 2023, a decrease of approximately €13 million.
At the same time, the repayment plan that had already been set in motion projected a reduction in municipal debt of more than €40 million by 2031. Based on the repayment data, the outstanding loan balance would drop from approximately €65 million today to approximately €24 million in 2031, a reduction of more than 60%.
The new Doukas loan undermines the municipality’s financial consolidation and puts the city at risk.
Truth 22
Athens needs a plan, not a blank check
Schools need investment. That is not in dispute.
What is in dispute is whether the right answer is a mammoth loan without full documentation.
The ultimate truth
Municipalities are not driven to the rocks by a single decision.
They are driven to the rocks when revenues decline, cash reserves decline, investments decline, expenses rise, and the administration’s response is more borrowing.
If we continue like this, the City of Athens is headed for the rocks.
And then Athens risks being placed under fiscal supervision, which would be akin to a memorandum for local government.
Athens needs a plan. Not blind borrowing.
Mr. Doukas is replacing the search for funding with borrowing.
The previous municipal administration secured resources for Athens. The current one is leaving Athens in debt.
