The House of Representatives unanimously passed into law the Professional Pension Benefit Plan for Employees of the State Service and the Wider Public Sector, providing after ten years of effort retirement coverage to thousands of workers including permanent employees.
The new pension scheme covers all serving employees who were recruited or appointed after 1/10/2011, as well as those permanent employees who will be appointed for the first time to a post on or after the date of entry into force of the law.
During the plenary session, all speakers who took the floor spoke of a historic step and noted that the State must address the disparity in pension coverage between the public and private sectors.
Approval after 10 years of discussions
The DIKO deputy chairwoman and chairwoman of the finance committee, Christiana Erotokritou said the committee thoroughly discussed the bill, which she described as very important.
"It is a very important bill, which ooks a new order in the field of pensions for employees of the wider public sector and is a step in the right direction," she said.
Referring to the changes introduced in the bill, Erotokritou singled out the creation of an investment committee, which includes the Minister of Finance, the Director General of the Ministry of Finance, the Auditor General and Accountant General, a committee which will appoint external consultants to manage the fund.
"The performance of the fund will ensure the payment of pension benefits. This committee will annually assess the technical reserves and whether they are sufficient to pay the pension benefits," he said, adding that in the original bill the contribution rate would be determined by decree by the Finance Minister of the day, while now any variation would be determined by regulations tabled in Parliament.
She also stressed that there is no possibility for the state to use the fund's reserves in any way.
Erotokritou also stressed that the issue of pensions in the private sector must finally find the Cypriot state in a consensus. "They cannot remain in the status quo, we must enter the third pillar, to have decent pensions also for the private sector workers whom we have left at the mercy of God," she concluded.
Speaking of a "new page" regarding public and wider public sector pensions, DISY MP Onoufrios Koulla said "We will indeed have a universal pension system without discrimination."
Referring to the amendments governing the management of the fund, Mr. Kulla pointed out that "we must not make another fund, which will be the easy funding of whatever Ministry of Finance future."
"We must not create more holes in funds that the taxpaying citizen will be asked to cover in the future," he stressed, also noting that for the first time about 6,000 permanent workers will have a pension with the same rights.
With regard to the employees who retired before the plan was enacted and the Government's commitment to a one-time grant, which he described as the best solution, the DISY MP said that whoever the new Government is and whoever is Finance Minister "this commitment of the State must be honoured in full".
Finally for the private sector, he said the arrangement was not simple, but pointed to the significant increase for low pensioners with the allowance currently reaching €369, which is a "noticeable increase" for about 35.000 low pensioners.
AKEL MP Andreas Kafkalias[/B] said that AKEL would vote in favour of the bills which were the product of the government's framework agreement with the trade unions. He also noted that the changes made to the original bill by the Finance Committee were a response to those who said that the bills had to be approved without any discussion.
He pointed in particular to two improvements, concerning the investment policy of the reserve and the limitation of "superpowers" to the respective Finance Minister.
He referred to the injustice of not including those who were hired before September 2011 and retired before the bill was enacted with the government's commitment that they would be covered by a one-time grant, to note that the House did not introduce any amendments in this regard, so as not to put the whole system "on trial", meaning a possible mention of the law by the President of the Republic.
Finally, on pensions in theprivate sector, Kavkalias said that when the issue is raised "the government responds by referring to studies to be done in the future."
"It is a sore issue and we will call on the next government to provide solutions to this issue," he concluded.
Sotiris Ioannou, an ELAM MP,[/B] called today's day quite important, since, he said, the new pension plan removes several pending issues that existed since 2011 andseveral thousands of workers are affected.
He said the bill came late and with many loopholes, as it has no provisions for retired workers who were unfairly treated, and in its original form the bill did injustice to contract noncommissioned officers. He acknowledged that there are individuals who are grossly unfairly wronged, but advocated for their approval as opposed to affecting tens of thousands of workers.
For his part, EPP MP Elias Mirianthous welcomed the new pension plan, saying it has both positives and negatives. Mirianthous said that private sector pensions should also be regulated "It is, I believe, a blatant injustice, an inequality to see starvation pensions and the state itself not being able to give a decent pension to those who have given their best to set up the economy," he said.
And PPP MP Alekos Tryfonidis described the day as an important one for public and wider public sector employees. "The new pension law unfortunately took ten years to be worked out. It covers more than 20 thousand employees who did not have a defined pension and all other benefits." He said the House's advice was crucial as necessary corrections were made especially on the investment policy of the reserve fund.
He also described it as a setback that the Ministry of Finance did not agree to cover the 180 people either civil servants or teachers who were made permanent after 2012 and have been retired before the bill was enacted. Marinos Mousiuttas said the bill is not perfect but it addresses an issue that has bedeviled the wider public service for a decade and added that Parliament will be here to bring about any improvements and changes.
Speaking on behalf of the Ecologists - Citizens' Co-operation Movement, Stavros Papadouris said that a difficult issue that has been pending for years is being closed today, adding that "we have reached very fine lines and the result is quite good." He acknowledged that there are good however there is a good system, good legislation and safeguards were put in place.
"We have created two tiers of pensioners big difference between public and private sector. I hope with the same zeal to discuss the issue of private pensions. The waste is huge the social inequality is winking at us," he said."
Source: CNA
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