European Trade Union Institute, ETUI.

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12 March 2018

Cyprus: bill provides low-income pensioners with supplementary pension pay

A bill dedicated to low-income pensioners that originally was adopted in 2014 has been amended. The trade unions and the pensioner associations were very critical about the 2014 bill as it impoverished low-income pensioners instead of helping them out.

During a debate in the parliament in January 2018, several amendments to a bill dedicated to low-income pensioners were approved. The house passed a law, which entitles these pensioners to apply for supplementary pensions from the ministry of labour and social security. The bill that originally passed in 2014 was addressed to people who received a low pension until July 2014 and who benefitted from a complementary pension, also commonly known as the ‘small cheque’, and who did not file an application to continue receiving it when the Guaranteed Minimum Income was introduced. In order to be eligible for the ‘small cheque’, a person has to have an annual income below the poverty line (less than €10,324 for an individual and €15,486 for a couple).

The government had planned to apply for those who missed the deadline on November 2014 the opportunity to do so until the end of 2018. However, the parliamentarians decided unanimously to prolong the deadline until the end of 2019. According to the government, the changes were necessary because the original measures were unconstitutional and violated the principle of equality. The law specifies that applicants will be examined on the same criteria as those who had applied in 2014. The right is not given to those who have given away large amounts of deposits (to relatives or other persons) to appear that they have less than €5,000 in the bank to receive allowance given to households below the poverty line.

The original bill that passed in 2014 entitled low-income pensioners to the bonus provided they could demonstrate that they were eligible. However, it did not provide for retroactive payment meaning there would be unequal treatment between those who applied on time and those with a delayed submission. Pensioner associations had rung the alarm clock as around 20,000 low-income pensioners did not submit their applications and had lost the right to the small cheque. The trade unions have criticised the 2014 bill from the start, as it effectively has brought low-income pensioners in a worse position than previously and essentially forced them to provide full access to their bank accounts for the state or lose half of their pension.

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