Cyprus pension reform to increase payments for all retirees

Cyprus is planning a major pension reform, marking the first significant overhaul of the system since 1980. Labour Minister Marinos Mousiouttas announced that all retirees will receive increases, with the most substantial benefits directed toward those on lower pensions.

The reform aims to create a more sustainable and modern system. Increases will be determined by factors such as years worked and total contributions. Of the 123,212 current social insurance fund pensioners, more than 51,000 are expected to see monthly increases exceeding €100. These adjustments will be implemented gradually over a five-year period.

For pensioners receiving up to €600, a minimum increase of €30 will be applied from the first month the reform begins. While the low-income pensioner allowance may decrease as individual pensions rise, the Minister stated that total income for these recipients will not fall below current levels. Regarding the 12 percent actuarial reduction for those retiring at 63, the government proposes a reduction of that penalty to 4.5 percent to maintain fund sustainability.