Cyprus pension reform will enter a reform trajectory from the new year, with completion targeted within 2026, Labour Minister Marinos Mousiouttas stated on SIGMA’s “Mesiméri kai Kati” show. He emphasized that discussions remain at an early stage.
Stakeholder meetings are underway, followed by one-on-one sessions and convergence at the Labour Advisory Council to map out the pension reform roadmap.
Key issues include the minimum pension level and the 12% pension penalty. The minister noted legislative distortions creating inequalities and injustices.
Long-term sustainability focus
Mr. Mousiouttas aims for a modern Cyprus pension reform addressing current needs with a long-term character, tied to the Social Insurance Fund’s viability. He warned that generous pensions cannot continue if the fund depletes in a decade.
On the 12% penalty, which faces calls for abolition, he recalled that pre-crisis retirement age was 63, raised to 65 during the crisis. Without actuarial reduction, retiring at 63 would disadvantage those waiting until 65 despite more service years.
Though the measure lacks fairness, corrective actions are planned, as equal benefits for retiring at 63 versus 65 cannot persist. Former Labour Minister Yiannis Panagiotou had proposed partial fixes, yet to be reviewed.
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