The Ministry of the Interior’s budget for 2027, as well as the Medium-Term Fiscal Framework for the period 2027–2029, were presented today, November 9, 2026, before the Parliamentary Committee on Finance and the Budget, by the Minister of the Interior, Mr. Konstantinos Ioannou.
The budget, totaling €780 million, reflects the Ministry’s strategic priorities and policy direction for the coming year, with an emphasis on affordable housing, support for the refugee community, strengthening local government, revitalizing rural areas, modern urban planning, merit-based management of Turkish Cypriot properties, digital transformation, and the upgrading of civil protection.
ΣΧΕΤΙΚΑ ΑΡΘΡΑ
The primary objective for 2027 is to continue and complete the reforms and projects already underway, addressing inefficiencies, and evaluating the effectiveness of the policies being implemented, so that public resources are translated into tangible results for society.
Fiscal Overview of the Budget
The Ministry of the Interior’s budget for 2027 amounts to €780 million, representing an increase of €1.5 million compared to the initial approved budget for 2026 and an increase of €110.5 million compared to actual expenditures in 2025. Projected revenues amount to €246.3 million.
Development expenditures total €263.5 million, representing 33.1% of the total budget, while operating expenditures total €517.4 million, or 65%.
The bulk of the expenditures relates to state grants to local authorities and other organizations, subsidies, and housing programs, as well as funding for co-financed projects and projects under construction.
The implementation rate of the 2026 budget is expected to reach at least 85%, while, excluding expenditures by the Directorate of European Funds, implementation during the first ten months of 2026 shows an increase of nearly 7% compared to the corresponding period in 2025.
Utilization of European Funds: €662.9 million for the 2021–2027 Programming Period
European funds are a key tool for implementing the Ministry’s policies and development priorities. For the 2021–2027 Programming Period, total public expenditure amounts to €662.9 million, of which €496.8 million comes from European funds.
Of particular importance is the promotion, for European co-financing, of the project to construct 460 affordable rental housing units on state-owned land in the districts of Nicosia, Limassol, Larnaca, and Paphos, with a total budget of €70 million. Work is scheduled to begin in December 2027, with completion targeted for April 2031.
Housing Policy: Investment of Over €70 Million to Expand Housing Options
Ensuring affordable and adequate housing is one of the Ministry of the Interior’s top priorities. The government’s housing policy is based on two main pillars: increasing the available housing stock and providing financial assistance to citizens to help them purchase a home.
For 2027, €32.5 million is allocated for the implementation of housing plans. Taking into account the €22 million expected to be generated from the utilization and purchase of building rights through the Urban Planning Incentives and the Build to Rent Program, as well as the value of approximately €17 million from the 523 plots of land to be made available through the Family Land Allocation Program, the government’s total investment in housing policy for 2027 exceeds €70 million.
As part of efforts to increase the housing supply, the following initiatives are also being promoted:
- The “Renovate-Rent” Program, aimed at revitalizing existing housing and bringing it into the rental market.
- Plans for the construction of collective housing units and student housing units to meet the needs of specific population groups.
- The project to build 460 affordable rental housing units on state-owned land, with a total budget of €70 million, co-financed by the European Union.
- Urban Planning Incentives and the “Build to Rent” Program, which help boost residential development and create new affordable housing options.
The reform of the permitting process, through the simplification and digitization of procedures, has also made a decisive contribution to increasing the housing supply. To date, approximately 3,000 permits for single-family and two-family homes have been issued within 40 business days, while more than 1,400 permits for apartment buildings with up to 20 units have been issued within 80 days.
In addition, the new plan for adding an additional story or expanding existing homes allows families to make the most of their property to provide housing for their members, thereby reducing construction costs and making better use of residential land.
Support for Young People and Families – Strengthening Citizens’ Purchasing Power
Particular emphasis is placed on providing financial support to young people and families, as well as on revitalizing mountainous, remote, and disadvantaged areas and rural regions.
For 2027, €20 million has been allocated for housing support programs in these areas, an increase of €5 million. From 2019 through September 2026, 2,400 applications have been approved, with total financial assistance amounting to approximately €91 million.
At the same time, through the Financial Assistance Program for young people and young couples under the age of 41, 700 beneficiaries have already received support, with a total expenditure of €26 million. The Ministry intends to reopen the program for a specific number of beneficiaries.
Another significant new initiative is the Program for the Allocation of Plots of Land to Families, through which state-owned land in communities across Cyprus is utilized, by granting plots at 25% of their general appraisal value. For 2027, 523 plots are projected to be allocated, with a total estimated value of €17 million. The goal is to help young families acquire their own homes and to boost population growth and revitalize rural areas.
Refugee Housing Policy: €85.7 million for 2027
Supporting the refugee community remains an ongoing responsibility of the State. For 2027, €85.7 million is allocated for the implementation of the refugee housing policy, while total appropriations for the three-year period 2027–2029 amount to €245.3 million. The funds cover housing grants, rent subsidies, repairs to Turkish Cypriot homes, as well as upgrade projects in government-run housing estates and self-housing settlements.
At the same time, implementation of the “Ktizo” Plan continues, with a total budget of €105 million for its three phases. For 2027, its budget is projected to increase to €16 million, up from €11 million in 2026 and €7 million in 2025.
The revised and streamlined housing programs of the Service for the Care and Rehabilitation of Displaced Persons have increased the number of beneficiaries by 15% and accelerated the processing of applications. For 2027, the relevant funding amounts to €42.6 million, while a revision of the rent subsidy criteria is also underway.
In addition, a 20% increase in subsidies is being granted to refugees who are beneficiaries of housing revitalization programs for mountainous, remote, and disadvantaged areas, as well as rural areas. At the same time, procedures are underway to issue title deeds and lease certificates in more than 1,600 cases, resolving long-standing issues in refugee settlements.
In the area of Turkish Cypriot property management, measures are being promoted to prevent mismanagement and strengthen good governance. Revenues from the Trustee Fund are expected to increase by €1.3 million and reach €8.5 million in 2027, while the state subsidy remains at €6.5 million.
Strengthening Local Government and Revitalizing Rural Areas
Supporting the reform of local government and ensuring the smooth operation of the new entities remain key priorities.
For 2027, state grants to local authorities are projected to total approximately €186.5 million. In addition, €10 million is earmarked for the implementation of development projects in the municipalities.
At the same time, for the three-year period 2027–2029, grants to free and occupied local government authorities—including municipalities, communities, and district self-government organizations, will exceed €560.2 million.
To revitalize rural areas, through the District Administrations and the Department of Urban Planning and Housing, the implementation of development and infrastructure projects continues, with a total investment of over €44 million for 2027. In addition, efforts are underway to utilize European and national funds, totaling €3.5 billion, to carry out projects in villages across all districts.
Modern urban planning and utilization of state-owned property
For 2027, €38 million is earmarked for major infrastructure projects in all districts, including road improvements in the Tseri and Argyroupoli areas of Nicosia, the Larnaca-Dhekelia coastal road, the Deryneia-Sotira connection, projects on the second Limassol bypass, as well as urban renewal projects in municipalities and communities.
At the same time, efforts are underway to revise the Local Plans for Nicosia, Limassol, Larnaca, and Paphos, as well as the modernization of the legislative framework for listed buildings, by simplifying procedures for the transfer of building density quotas and creating a digital registry to enhance transparency.
Civil Protection – Strengthening the country’s security and preparedness
To strengthen civil protection, €17.8 million is allocated for 2027. Efforts are underway to establish the National Civil Protection Mechanism and the National Coordinator, with the aim of ensuring unified planning and effective coordination among all relevant agencies. At the same time, work continues on updating the National Plans, upgrading the Early Warning System (CY-Alert), and implementing the new NG112 emergency system. These efforts also include modernizing sirens and shelters, as well as strengthening equipment and stockpiles, with an emphasis on prevention, preparedness, and the effective protection of human life and property.
A Citizen-Centered Budget
In conclusion, the Minister of the Interior emphasized that the 2027 Budget serves as a roadmap for a modern, effective, and people-centered state, one that plans with a long-term perspective and responds to the real needs of society.
As he noted, the goal is to expand housing options, revitalize cities and communities, strengthening local government, modernizing public services, and fortifying institutions and civil protection, all with fiscal responsibility and the rational use of every available resource.
Mr. Ioannou emphasized before the Parliamentary Committee on Finance that the citizen is at the center of every policy of the Ministry of the Interior. “Our efforts,” he said, “are focused on initiatives that have a tangible social and developmental impact, with the goal that every action be visible and bring about positive change in the lives of citizens.”
