18 January 2014 10:25

<div>A new Labour Ministry proposal aims to limit the number of social pensions by 20% in introducing tougher income criteria for recipients.</div> <div>The Social Pension Scheme (SPS) is an income-tested scheme, which covers residents of Cyprus with no or low pension income.</div> <div>According to the Finance Ministry: "The SPS closes the gap in accessibility to pensions by providing income-tested pensions to those residents, of 65 years or more who, for any &#160;reason did not participate enough in the labour market and as a consequence have no or low old-age pension income."</div> <div>The proposal for a change in the criteria was put forward during a Labour Ministry meeting, attended by the involved parties including pensioner organisations. It has not been announced when a final decision on the proposal is expected.</div> <div>It aims at narrowing down the number of people, currently 15,522 entitled to the social pension.</div> <div>The Labour Ministry hopes to decrease the figure to 12,423 people, meaning some 30,000 will no longer be receiving the funds.</div> <div>The ministry suggests that income criteria already used by the Finance Ministry's Grants and&#160;Benefits&#160;Service&#160;in its separate scheme to assist low-income pensioners be applied when awarding the Social Pension if and when the proposal is approved.</div> <div>In line with the proposal, income from pensions, work, interest, dividends and rents will be taken into account with the poverty line set at €794 per month for households with one resident and €1,191 per month for a household with two residents.</div> <div>The state spent €67.6 million on social pensions in 2013 and aims to reduce this year's figure by €13m &#160;to €54.3m to fulfil Cyprus' Eurogroup bailout obligations even though the relevant budget for the purpose this year stands at €57.6m. The Social Pension is financed by the government's Consolidation Fund.</div> <div>Beneficiaries are mostly women (about 97%), "especially of older generations with relatively low labour force participation rates".</div> <div>&#160;</div> <div>&#160;</div>


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