Cyprus' planned pension reform will address the modern needs of pensioners while safeguarding the sustainability of the social insurance system, Government Spokesman, Konstantinos Letymbiotis, has said.
Speaking to reporters in Paphos on Sunday, 12 July, after a memorial service for those killed during the 1974 coup in Cyprus, Letymbiotis described pension reform as the government's next major reform initiative.
He said President Nikos Christodoulides, together with the Ministry of Labour and Social Insurance and the Ministry of Finance, has prepared a comprehensive framework for the reform.
"The objective of any state is to strengthen its public finances and maintain a strong, resilient economy," Letymbiotis said, adding that this provides the solid foundation needed to support measures aimed at increasing citizens' disposable income.
He noted that the government had already implemented a series of measures, including the tax reform, two increases to the Guaranteed Minimum Income and the full restoration of the Cost-of-Living Allowance (CoLA) after years of partial application.
"The next important step is a pension reform that takes into account the modern needs of our pensioners while ensuring a resilient social insurance system," he said.
Letymbiotis added that the Ministry of Labour and Social Insurance has already presented the executive's main proposals to social partners. Their views, together with those of political parties, will be incorporated into the final reform package to ensure it delivers tangible benefits for pensioners as soon as possible, he added.
Asked about the timetable, he said the government expects to submit the relevant legislation to the House of Representatives after September, once the consultation process has been completed.
He stressed that the government views public consultation not as a formal procedure but as a substantive tool for improving legislation, citing the tax reform process as an example.
Cyprus aims at a fair, financially sustainable pension system, Labour Minister says
Cyprus is pursuing reforms to ensure that its Social Insurance system remains fair and financially sustainable in the face of demographic challenges, Labour and Social Insurance Minister Marinos Moushouttas has said.
Speaking to reporters on 10 July, Moushouttas said the Ministry of Labour and Social Insurance is working to safeguard the long-term sustainability of the country's pension system.
"Our goal is a system that is fair, adequate and financially sustainable, guaranteeing a dignified retirement income," he said.
The Minister warned that rising life expectancy, an ageing population and changing labour market conditions are making pension reform increasingly urgent.
"We are living through a period of demographic transition. Rising life expectancy, an ageing population and changing labour market conditions make pension reform not simply desirable, but necessary," he said.
Moushouttas said Cyprus' pension framework rests on three complementary pillars, with the Social Insurance system forming the foundation, occupational pension schemes providing a second layer of protection and voluntary private insurance supplementing retirement income.
He noted that the third pillar is becoming increasingly significant, saying private insurance and personal savings schemes enable people to plan ahead, protect their income and face future uncertainties with greater confidence.
The Minister also described the insurance sector as a key component of the country's social protection framework, particularly during periods of crisis and natural disasters, underlining its contribution to economic and social resilience.
(Source: CNA)
