The social partners view the pension reform positively, but with significant reservations, acknowledging the improvements made by the government but pointing out that some issues remain unresolved. Speaking on the “Alpha Kalimera” program, PEO Deputy Secretary-General Christos Tombazos and KEVE General Director Filokypros Rousounidis, addressed the outstanding issues, funding, and the long-term sustainability of the system.
Christos Tombazos acknowledged that the government had implemented three improvements, though these did not fully satisfy the unions. These include reducing the transitional period for paying out the increases from five to three years, the extension of the transition period to 15 years to prevent pension cuts, as well as changes to the eligibility requirements for widow’s and disability pensions. “This doesn’t satisfy us either. But we realize it’s a step forward. It’s progress,” he noted specifically regarding the payment of increases over a three-year period.
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At the same time, the PEO’s Deputy Secretary-General expressed concern about how credits for periods of study and child-rearing are calculated, arguing that they will no longer be taken into account when determining specific pension entitlements. He also raised the issue of low-income pensioners, estimating that under the current proposals, thousands will continue to fall below the poverty line. Among the outstanding issues, he included the reduction of the 12% penalty and the widow’s pension for men whose wives passed away before 2008. He also placed particular emphasis on the economic dimension of the reform, questioning the optimistic projections for investment returns and calling for a clear picture of who will bear the cost.
For his part, Philokypros Rousounidis described the promotion of the reform as significant, noting that “we must give credit to the government for promoting such a reform after more than 46 years—a landmark reform, if you will, that affects all citizens.” He explained that the KEVE entered the dialogue with three basic conditions: that contributions not be increased, that the retirement age not be raised, and that the Fund’s sustainability be ensured. Referring to the initial proposals, he expressed concern about the possibility of reducing the supplemental pension, emphasizing that “Someone who is currently paying higher contributions is doing so in order to receive a higher pension. This is a fundamental right.”
Regarding financing, the General Director of KEVE referred to contributions, new categories of contributors, and the investment policy to be followed. He emphasized the need to entrust the Fund’s management to qualified technocrats with international experience, while also expressing reservations about the projected investment returns.
For his part, Christos Tombazos argued that, based on the initial cost estimates, the reform appears to rely primarily on the reallocation of resources within the Fund itself, while he expressed concern about the financial burden being shouldered by the state.
Finally, referring to the second pillar of the reform, Philokypros Rousounidis made it clear that the CCCI’s position is that the Provident Funds should remain voluntary, while incentives should be provided to expand the system. He clarified, however, that the Chamber is willing to discuss alternative proposals, provided that the competitiveness of businesses is not affected.
Both representatives agreed on the need to conclude the social dialogue, with Mr. Rousounidis describing the timeframe as extremely tight and emphasizing the importance of reaching the broadest possible consensus before the bill is submitted to Parliament.
