Cyprus pension reform sparks debate over retirement age

Discussions regarding pension reform in Cyprus have intensified following a meeting of the Labour Advisory Board. The government's proposed reform focuses on two main pillars: increasing pensions for low-income retirees and ensuring the long-term sustainability of the Social Insurance Fund (TKA).

Finance Minister Makis Keravnos emphasized the need for 'insurance safeguards' to protect the system during future crises, noting that the reform must maintain fiscal balance. Minister of Labour and Social Insurance Marinos Musiotis stated that a primary goal is to improve the living standards of retirees with incomes below €19,500.

However, the proposal has met with differing views from social partners. The Cyprus Employers Association (OEB) suggested that if the sustainability of the TKA is threatened in the future, the government should consider increasing the retirement age rather than relying solely on raising social insurance contributions. This follows a provision in the government bill that allows for a review of the fund's sustainability five years after implementation.