The 12% penalty needs a drastic cut

Opinion economypensionerspensions The 12% penalty needs a drastic cut Υπουργείο Εργασίας 1 Id 394365 1 Relevant News The 12% penalty needs a drastic cut 2 September 2026 Erhurman says sunken Kyrenia catamaran has been located 2 September 2026 Cyprus’s madness: tragedy first, action second 2 September 2026 Phileleftheros Editorial 2 September 2026 FacebookXWhatsAppEmailPrintViber Talks on pension reform are pressing ahead, with the government pushing to keep to the timetable it has set itself. Tomorrow, Thursday, at the Labour Advisory Body meeting, Labour Minister Marinos Moushouttas, working with the actuary and the Finance Ministry team, will set out the government’s position on the 12% penalty. It’s a significant issue, and one that has to be dealt with as part of the wider changes now under way to the pension system. This particular discussion matters because the outcome will shape the bigger picture of pension reform as a whole. The prevailing view, as things stand, is that the 12% penalty cannot be scrapped outright, since doing so would effectively lower the retirement age to 63. But it’s equally clear that 12% is too high, and there must be a drastic reduction. That must be everyone’s goal. Those involved, particularly on the union side, have already put forward proposals on this in earlier rounds of talks. But it’s obvious that everything is now being put on a new footing, given that we’re in the final stretch before the government tables its bill in Parliament. It’s clear that the whole reform package is being put under the microscope by the Finance Ministry. Every proposal is being costed, because the aim is for both the pension fund and the wider economy to be able to bear the changes. This is something all parties need to bear in mind. The Labour Minister has said, in comments on Alpha television, that Finance Ministry calculations put the cost of the reform at 500 million euros over six years, or roughly 75 million euros a year. The government’s proposal is based on actuarial studies and takes into account what the economy can withstand. So what’s actually at stake here? A change to the pension system, after 46 years. One that should work in favour of pensioners. Today’s and tomorrow’s. It should raise, not lower, people’s standard of living. What matters now is that the talks move forward and are wrapped up soon. As things stand, at least four meetings have been scheduled for September. But the road to concluding the talks still looks like a long one. Subscribe to our Newsletter Latest News Erhurman says sunken Kyrenia catamaran has been located Cyprus’s madness: tragedy first, action second Cabinet approves up to €45,000 in aid for August storm damage Six West Nile virus cases confirmed in Cyprus, all hospitalised Cape Greco boat wreckage recovery to begin today as two probes continue SBA Police close Paphos road near Episkopi after serious crash Things to do on Wednesday, September 2 Follow en.philenews on Google News and be the first to know all the news about Cyprus and the world.