Cyprus to cut 5000 govt jobs, payroll costs; teachers refuse to help

The government of Cyprus plans to cut the number of staff in its broad public sector by 5,000 over the next five years, spokesman Stefanos Stefanou said on Friday, a day after the teachers rejected a proposal for voluntary contributions to help reduce the island’s huge public deficit.
However, the core government workers will not be affected as job reductions are expected to come through the abolition of posts after the holder retires.
Authorities also aim to cut the entry-level payroll for new starters in the civil service and reduce overtime pay by an additional 5% this year and 20% in 2012. Three semi-government organisations, the olive, potato and milk marketing boards, will also be abolished, Stefanou said.
The government spokesman said there would also be changes to the way civil service pension payments are calculated, and a "contribution" made by staff in the broader public sector. To date, only private sector workers and employers make joint contributions to the near-bankrupt Social Insurance Fund, while ion the public sector, only the government pays in to the pension fund.
The government has also set ambitious targets top raise a further 100 mln euros from a scaled levy of 1000 euros a year paid by profit-making companies and adjustments to taxation on real estate.