Pension reform talks progress, unions remain concerned

Labour Minister Marinos Mousiouttas on Thursday struck a buoyant note over ongoing talks on pension reform, but trade unions reiterated that their key concerns have not been allayed. The minister was speaking after chairing the latest meeting of the labour advisory board – consisting of representatives of trade unions and employers’ organisations. Lasting more than three hours, the meeting was “very useful”, Mousiouttas said. “I can say we’re in a far better position now as regards the elements [of the reform] that might be altered.” The sides presented their respective positions on a range of issues. Mousiouttas insisted on the government timetable of having the reform pass through parliament before year’s end, so that it can be implemented as of the beginning of January. The labour advisory board will reconvene on Monday, and then Thursday. Answering journalists’ questions, the minister refused to be drawn on outstanding disagreements, or what might constitute a “deal breaker”. He did concede that the stakeholders have different approaches to the matter, adding that “this is logical and we respect it.” The minister rebuffed the notion that the planed overhaul of the pensions system might bring about a decrease in the revenues of current pensioners. “For us, there is no such issue,” he stressed. For her part, Sotiroulla Charalambous, head of the left-leaning PEO union, said they retain their concerns over low-income pensioners. Panicos Argyridis, head of the SEK union, laid out their ‘red lines’ – no increase in social insurance contributions over and above what is prescribed in the government bills, no change in the retirement age (unless linked to life expectancy), and the long-term viability of the Social Insurance Fund (SIF). For decades, the state has dipped into the SIF for financing, paying it 2.15 per cent interest for the money it borrows. The total amount owed to the fund stands at around €12 billion. As part of the coming overhaul, the state will stop borrowing from the SIF and gradually repay its debt to it in instalments. The last major reform on the pension system took place in 1980, with additional changes introduced during 2012-2013 as part of Cyprus’ bailout agreement with international lenders.