Cyprus’ pension reform aims to deliver higher pensions, greater support for low-income pensioners and a stronger and sustainable Social Insurance Fund for future generations, Government Spokesman Konstantinos Letymbiotis said.
Speaking to journalists at the Presidential Palace, Letymbiotis said intensive social dialogue was under way on the pension reform, the first substantial review of the system since 1980.
Social dialogue enters key stage
Discussions continued on Thursday at the Labour Advisory Board, moving into the substantive aspects of the government’s proposal, including measures concerning low-income pensioners and actuarial adjustments.
The Minister of Labour and Social Insurance also began a series of meetings with parliamentary parties.
Letymbiotis said the pension reform forms part of a broader programme aimed at increasing disposable income and ensuring a fairer distribution of the benefits of the country’s economic progress.
He noted that the government’s tax reform had reduced the tax burden and increased net income for thousands of workers, families and citizens. However, he acknowledged that some pensioners do not have income levels that allow them to benefit from tax reductions to the same extent.
The pension reform is intended to complement those measures through direct increases in pensions and additional support for those most in need.
More than 51,000 pensioners set for increases
According to Letymbiotis, more than four in 10 pensioners, a total of 51,664 people, are expected to receive an increase of more than €100 per month once the reform is fully implemented.
Particular emphasis is being placed on the lowest pensions. Pensioners currently receiving up to €600 are expected to receive a significant increase from the beginning of the reform’s implementation.
“The substance of the reform” is to provide greater support to those who need it most and ensure a fairer retirement income after a lifetime of work, Letymbiotis said.
Reform to address gaps in system
The pension reform will also seek to address inequalities and distortions that have developed over the decades and better reflect modern working and family life.
The proposals include provisions covering periods of caregiving, maternity, disability and other circumstances in which people are forced to leave the labour market.
The aim, Letymbiotis said, is to create a system that better recognises each citizen’s actual life and employment journey while ensuring a more dignified retirement income.
Reform targeted for 2027
The government’s goal remains for the pension reform to come into force in 2027.
Letymbiotis said this would allow the changes to translate as quickly as possible into tangible and meaningful benefits for citizens.
Also read: Drivers spending €5 to €20 at pumps as fuel prices soar
For more videos and updates, check out our YouTube channel
