Nicosia, Cyprus. The government aims to submit legislation reforming the first pillar of the pension system to parliament by early June, with the objective of implementing the changes by 2027, Labour Minister Marinos Mousiouttas said on Tuesday.
Legislative timeline and consultations
Mousiouttas made the comments after a two-hour session of the labour advisory body. He said four additional meetings of the advisory body have been scheduled for March to advance technical discussions and build the widest possible consensus among the state, employers and trade unions.
“The differences on the first pillar are not so great and can be overcome,” he said.
Scope of the reform and second pillar plans
The reform concerns the first pillar of the pension system, linked to the social insurance fund. Discussions on the second pillar, covering provident funds, will follow on a longer timeline.
Mousiouttas said that while the immediate focus remains on the first stage of the reform, the government intends to outline a general framework for the second pillar during the current discussions. He said implementation of the second pillar would require at least three to four years.
Early retirement reduction to be revised
Mousiouttas addressed the reduction of 12 per cent applied to pensions for those retiring before the age of 65, describing it as a sensitive aspect of the reform. He said the reduction will be revised downward under the new system, and that for some pensioners it could fall to as low as 2 per cent, while for others it may reach up to 10 per cent.
He added that any final decision will apply to both current and future pensioners.
Concerns over possible pension cuts
Responding to concerns about possible pension cuts, Mousiouttas said scenarios involving small reductions for a limited number of pensioners remain assumptions at this stage.
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