Brussels, Belgium. Cyprus is aiming for a comprehensive reform of the pensions system to come into force by January next year, Labour Minister Marinos Moushiouttas said on Thursday.
Planned timetable and legislation
Speaking on CyBC radio from Brussels, Moushiouttas said the reform would unify the pension system and the so-called small cheques paid to low-income pensioners into one cohesive piece of legislation. He said the goal is to complete the bill by June so that it can be submitted after the opening of the new parliament following parliamentary elections, allowing discussions to begin. He said this would enable the reform legislation to be implemented from January next year.
Focus on income adequacy and fund sustainability
Moushiouttas said the reform is focused on ensuring pensioners receive a dignified income while safeguarding the sustainability of the social insurance fund. He said there is willingness among all partners to discuss and identify appropriate solutions, with the social insurance fund to be preserved for both current and future generations.
Consultations and investment policy
The minister said discussions within the labour advisory body were intensifying and said he was optimistic that differing views would not derail the timetable. He added that the reform would address investment policy for the fund and aim to ensure higher and more stable returns without increasing risk.
Changes to the small cheques mechanism
A central element of the reform is the treatment of the small cheques, an annual payment to pensioners below a specific income threshold. In recent years, pensioners’ organisations have criticised the mechanism, saying legally mandated pension increases have pushed recipients above the threshold, leaving them financially worse off.
How do you think the proposed changes to the small cheques mechanism could affect low-income pensioners?