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Minister of Labour and Social Insurance Soteroula Charalambous has said that ''the government intends to continue monitoring the impact of the financial crisis on social security and more importantly of the population ageing and if the need arises, it is determined to take targeted measures to cope with this challenge.''
Addressing the Meeting of the EPC Working Group on Ageing Populations and Sustainability, hosted by the Ministry of Finance with the support of the Ministry of Labour and Social Insurance, on Thursday in Limassol, Charalambous said ''a holistic and an integrated approach is required to be taken by each country, aiming at not only achieving a long-term sustainability of the public pension system but also ensuring adequate social protection and guaranteeing social equity.''
At this point, I would like to praise the Ageing Working Group committee for its excellent work in reviewing the long-term sustainability of public finances in the EU, particularly in relation to the projected demographic changes. That work is reflected in the 2009 Ageing Report, which is of vital importance, providing a solid quantitative framework to government authorities that guide future policy decisions.
I believe that there is room for further improvement in the scope of the work of the committee to include tools and options that could potentially be made available to government authorities for taking appropriate action to ensure the long-term viability of their public pension system.
Charalambous referred to the main pension challenges faced in Cyprus and the main measures the government has taken to confront them, adding that ''the main objective of the government social policy is to ensure the financial sustainability of public and private pensions schemes, bearing in mind pressures on public finances and the ageing of populations, in the context of the three-pronged strategy for tackling the budgetary implications of ageing.''
''In Cyprus, the global financial crisis has not had any immediate and direct impact on the general social insurance scheme, which effectively operates on a pay-as-you-go basis and aims to provide adequate levels of pension. The only indirect and long-term impact that the financial crisis has on social insurance is that it could increasingly worsen the broader, long-term fiscal challenges of Cyprus,'' she said.
She noted that, ''if the crisis is sustained, there will obviously be a pressure on the growth of the economy, which in turn could have a negative impact on employment,'' adding that ''the government has adopted national policies concerning the development of the labour market.''
