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Our View: Government must tackle pensions issue as a whole

PUBLIC sector doctors are threatening to take dynamic measures in protest against plans to extend retirement age to 68. In an announcement issued yesterday by their union PASYKI they complained that the decision “violated labour practices as there had been no social dialogue or exchange of views.” If the extension was implemented without any dialogue and without solving the problems faced by the profession, there would be “an immediate response, including dynamic measures,” the union warned.

What is peculiar is that not all the state hospital doctors are opposed to this move. According to a statement issued yesterday by AKEL – party of conservatism and reaction, when it comes to public sector privileges – the measure was aimed at satisfying a group of highly-paid doctors, whom, presumably wanted to stay in their jobs for longer. Such decisions could not be taken without dialogue between the social partners, argued the party, repeating its mantra about consensus.

However, the party made one valid point – this was an ‘isolated’ measure. But this is how government policy is forged in Cyprus. When there is an interest group that has close ties with the government and the parties, it arranges for the law to be changed to suit its members’ needs – in this case the doctors at the top of the wage scales who are approaching retirement age. They want to keep on working so the government extends the retirement age for all government doctors. It is unbelievable, but this is how government policy is forged.

The extension of retirement age must be considered by the government but it should apply to everyone. There are strong grounds for extending the retirement age for everyone. Life expectancy has increased significantly in the last 50 years, as people have much more comfortable lives – they are fit and healthy well into their sixties. The fact that people live for longer means that state pension funds are coming under significant strain – this is an EU-wide problem – and reforms are necessary. In order to deal with the problem, the UK government decided workers would contribute more towards their pension and receive less when they retired. Germany was considering extending the retirement age.

Cyprus also needs to see the state pension issue as a whole rather than deal with a small section of the public sector that was demanding the extension of the retirement age. This is an opportunity to reform the pension system in a way that would make it sustainable for a few more decades. It should also be made fairer. Public employees should contribute as much as the rest of the workers to the social insurance fund every month and pensions should be based on contributions; teachers must stop receiving double pensions; retirement bonuses must also be based on workers’ contributions.

This is what the government must tackle, instead of extending the retirement age of state doctors, because a group of them had demanded it.





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