Social security reform and pensions ‘top priority’ for labour ministry

The reform of the social security system and adequate income for pensioners are among the priorities of the labour ministry for the next three years, MPs heard on Friday during the presentation of its 2023 budget.

Labour Minister Kyriacos Koushos presented the budget as well as the medium-term financial framework for the 2023-2025 period, which aim to implement the ministry’s vision for a “decent standard of living for citizens” he said. Both budgets also aim at enhancing safety and protecting the health of all workers and ensuring industrial peace, Koushos said.

The ministry’s budget for 2023 is 6.5 per cent higher than the previous year at €621 million excluding co-financed projects, compared with €583 million in 2022.

“With the inclusion of co-financed projects, our budget for 2023 will be €657 million,” Koushos said, noting that the budget will increase further in the subsequent two years at €692 million and €720 million for 2024 and 2025 respectively.

Of the total €657 million for 2023, some 28 per cent relates to social benefits, funding and projects, four per cent relates to salaries, 66 per cent to expenditure on the general government levy and two per cent operating expenditure.

Some €180 million is being budgeted exclusively for social benefits and projects supporting citizens, Koushos said, noting how the ministry has to now provide for the budget of the deputy ministry of social welfare, established in 2021.

He said the implementation rates of this year budget is expected to be around 96 per cent.

The labour ministry has also contributed significantly to the implementation of the national Cyprus Tomorrow plan with reforms and projects to promote the green and digital transition, amounting to €170 million over the next five years.

Among the priorities set by the ministry, Koushos said, is to ensure a long-term high employability of residents, review and revise the strategy for the employment of third country nationals and introduce legislation to regulate telework. Moreover, the minister prioritises the promotion of safe and healthy workplace condition and the effective tackling of undeclared work.

The reform and modernisation of the social security system as well as the reform of the pension system to ensure adequate income for pensioners and to correct distortions were also among the priorities listed by the minister. Within the coming years, Koushos said there will be further digital transformation of departments and services.

A call centre is also expected to be established to serve residents.

Meanwhile, the introduction of the information system Ergani II by the central administration of the ministry, the digitisation of application and the simplification of the examinations procedures by the social security services as well as the extension of the coverage of self-employed workers were mentioned under the ministry’s objectives for next year.

The strengthening, protection and monitoring of the implementation of the national minimum wage and the organisation of postgraduate programmes in business and public administration were also mentioned.

In line with next year’s objectives, Turkish Cypriots who are citizens of the Republic will be offered training and employment by the labour department according to the minister.

Koushos also referred to important reforms implemented this year, such as the establishment of the national minimum wage, the digital transformation of the departments and services of the ministry and the three-year national disability action plan among others.

During the presentation, Koushos paid tribute to his predecessor, the late Zeta Emilianidou whose skills and determination turned the Anastasiades government’s vision of a welfare state into reality.