THERE is much confusion surrounding state pensions. We hear about multiple pensions for public employees who also served as a Representative or state official, the payment of pensions to retirees that were subsequently employed by the state and the payment of state pensions at different ages, not to mention the holes in the pension funds of semi-governmental organisations. It’s a complete mess, reflecting the slapdash and self-serving way in which legislation is drafted and approved.
Take for example the issue of multiple pensions by which convicted former governor of the Central Bank Christodoulos Christodoulou as well as his predecessor Afxentis Afxentiou were collecting three state pension totalling more than €10,000 a month because they had also served as civil servants and government ministers. Who drafted the law that allowed them to be paid three different pensions for serving the state from three different positions? Was it some deputy that had also served as a minister?
Deputies passed a law in 2011 ending this ludicrous practice which, in effect was lawful theft from the state, and replaced it with 50 per cent of the highest pensionable earnings. But that is not the end of the story as Afxentiou and former deputy and minister, Dina Akkelidou, have appealed to the Supreme Court claiming the law was unconstitutional. No ruling has been issued yet, but it would be no surprise if the court decided that 2011 law was unconstitutional as it had done in the case of the law preventing retirees working for the state also collecting their state pension.
Meanwhile, deputies that have left the legislature are paid a pension from the age of 60, despite having passed legislation pushing back the pensionable age for all other public employees to 65. It is not as if their work is more taxing – a few hours of work a week should not even be pensionable – not to mention that they collect a sizeable pension even after a serving a single five-year term. Again, it is a case of deputies legislating in their personal interest, ignoring concepts such as equal treatment or social justice.
DISY leader Averof Neophytou, to his credit, proposed last week, when the House was discussing the immovable property tax (IPT), the rationalisation of state pension which would lead to significant savings for the state and cover the loss of revenue from scrapping the tax. He was accused of populism by the other parties which have, as a matter of principle, always defended vested interests. But Neophytou and his party should not let the matter be forgotten once the IPT compromise is found. They should persist and also look at amending the law governing SGO pensions. We cannot have the CyBC with a €120 million deficit in its pension fund paying its retirees princely monthly pensions on the understanding the state would come to its rescue.
There is so much that could be done and save the taxpayer millions every year. It all depends on whether Neophytou and DISY would be prepared to take on the establishment, which includes many of its own people.