By Kostas Efimeros
Background on the Megaron Concert Hall (from its official website)
Founded in 1981, the Athens Concert Hall Organization, commonly known as the ‘Megaron’ is a non-profit-making organization administered by a board of trustees, half of whose members are appointed by the Ministry of Culture and Tourism, and half by the ‘Friends of Music’ – also a non-profit-making charitable association.
The Megaron is truly a cultural institution of the city’s life. It is also a private entity financed by the Ministry of Culture and private donors, and managed by people who are closely linked to the biggest media company in the country, a company with deep connections to the political and business elite.
So how was it possible that the Megaron over a period of years was able to accumulate debts totalling 230 million?
The fact is that the people who have been running it for decades did not need be overly concerned with racking up major debts. A big chunk of those loans were ‘guaranteed’ by the state. Therefore were the loans to become NPLs (non-performing), the state would simply bail out the organization and pay back the banks.
As is happening today.
Now, following the government’s decision to bail out the Athens ‘Megaron’ Concert Hall to the tune of 230 million, Culture Minister Panos Panagiotopoulos announced that the organisation will remain a private non-profit entity. The minister explicitly ruled out the possibility of it passing to the Hellenic Republic Asset Development Fund (HRADF), Greece’s privatization agency, despite the fact that its ownership has de facto passed to the state and under the memorandum between Greece and the troika, ownership of all such public assets must be transferred to HRADF and privatized. Yet the Minister apparently would find such an outcome for the Megaron highly upsetting saying, “culture cannot be for sale.”
This is despite his own government having given assurances that privatizations of other assets via the HRADF do not mean the loss of access to the public. The government did not hesitate to turn over dozens of Olympic facilities and even the building housing the Athens Police Headquarters, which the government now rents via a ‘lease back’ agreement from the new owner.
The Minister’s emotional response was not enough to conceal one simple truth: that the state, despite assuming responsibility of debts worth 230 million euros, is not asking how they were created. It has not announced a single inquiry into who took out the loans. Why is the state acting as the guarantor of a private entity? How was this astronomical amount spent? Why are banks continuing to give loans to a bankrupt organisation which was unable to pay off even the first installments on its loans? What does the BlackRock report on the Megaron’s finances say? Was money transferred to other companies (eg the media outlets whose top executives and owners are closely associated to the management of the Megaron)? Which administrations are responsible for the non-profit’s collapse?
The government, which ‘butted heads’ with the troika for three months in order to avoid imposing the 25 euro entry fee for public hospitals and then made a big fuss over passing an equivalent measure in the form of an additional tax on cigarettes, went to all that trouble over 40 million euros. Now after a meeting lasting a few short hours it has taken on 230 million euros worth of debt and it’s no big deal.
“Culture is not for sale,” according to the Minister. It seems that in Greece it is the only thing that is not for sale. At least not entirely, because in the list of the 74 bodies which will be eliminated (as a result of the memorandum imposed on Greece by the troika of lenders) there are 6 belonging to the Ministry of Culture and Sports, including the National Theater, the National Opera, and the State Theater of Northern Greece.
So to be more precise, the correct phrase would be, “culture is not for sale when publishers and media barons happen to be involved in the legal entity behind it.”
The government is privatizing water, even after the European Union removed water supply infrastructure from the list of state assets to be privatized. But not the Megaron…