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Labour minister hopes pension reform to be sent to next cabinet meeting

22 October 2026 at 09:21

Labour Minister Marinos Mousiouttas expressed hope on Thursday that the pension reform bills would be discussed at the next cabinet meeting.

Speaking at the beginning of the labour advisory body meeting, Mousiouttas said the legal review by the Law Office was expected to be completed by Monday and that, following the review, the reform would be brought to the next meeting of the cabinet to be approved and subsequently forwarded to the House of Representatives.

“We are entering the final stretch,” Mousiouttas said, adding that “the final measures are the most difficult.”

Furthermore, he said that the positions of the parties on the technical committee dealing with the second pillar of the pension system, the provident funds, appear to be taking shape, and that the discussion is expected to be moved to the labour advisory body.

According to the minister, employers’ federation OEV and chamber of commerce Keve have already submitted their positions in writing.

Deputy general secretary of trade union SEK Panikos Argyrides said the union would be submitting its positions on the matter by the end of the day.

Meanwhile, PEO general secretary Sotiroula Charalambous said that the trade union would be submitting its own positions by Monday.

Cyprus pension reform expected to boost state revenue from company dividends

19 October 2026 at 08:08

Cyprus is expected to increase state revenue by requiring company owners, directors and shareholders who draw dividends alongside low declared salaries to pay social insurance contributions on part of those dividend earnings, under a proposed pension reform.

The changes, first reported by local news outlet Philenews, aim to address a practice under which business owners and shareholders declare low monthly salaries while receiving additional income through dividends, potentially qualifying for tax exemptions and future social benefits.

According to Labour Ministry data cited in the report, 2,990 company owners, directors and shareholders working in businesses with up to three people declare monthly salaries below €500, despite also receiving dividend income.

Overall, 11,500 owners, directors and shareholders declare monthly earnings of up to €2,000, with 26 per cent reporting salaries below €500.

Contributions to be calculated on dividends

Under the draft pension reform legislation, employees who also hold shares in the companies where they work would have dividends from those businesses included in the calculation of their earnings for social insurance purposes.

The proposed system would require contributions on dividends until the individual reaches a ceiling equivalent to two insurance units, or €22,960 a year.

The threshold is based on annual basic insurable earnings of €11,480, the level set for both 2025 and 2026.

Under the formula, the authorities would first calculate contributions on the salary declared by the individual, then apply contributions to dividend income until the annual ceiling is reached.

For example, a company owner declaring a salary of €500 a month, or €6,000 a year, would pay contributions on that salary, with additional contributions calculated on dividends until the relevant ceiling was reached.

Labour Ministerial figures cited in the report indicate that someone earning an annual salary of €15,000 and receiving €30,000 in dividends would pay contributions on their salary and a further €8,000 in dividends, bringing the total earnings subject to contributions to approximately €23,000.

The reform is intended to increase the number of people contributing to the social insurance fund and, consequently, boost state revenue.

Changes address low salaries and dividend income

For years, the report mentioned, some company owners, directors and shareholders have declared monthly salaries of around €500 while receiving much of their income through dividends, on which they did not pay social insurance contributions.

Before the 2026 tax reform, dividend income was subject to a 17 per cent tax rate, which was reduced to 5 per cent from January 1, 2026.

Because some individuals declared low salaries, they could also fall below the income tax threshold and pay no income tax on their salaries, while potentially qualifying for social pension payments and benefits for low-income pensioners in the future. The practice was permitted under the existing legal framework.

The Labour Ministry’s proposed changes seek to ensure that social insurance contributions more closely reflect the income received by individuals who are both employees and shareholders.

The labour minister has said that some people declare low salaries while simultaneously receiving dividend income, and that the aim is for pensions to reflect the contributions made by each insured person, reducing reliance on welfare benefits.

New category for people receiving income from assets

The pension reform bill also proposes creating a new category of contributors to the social insurance fund covering people whose income comes from sources other than conventional employment.

This category, described as income earners, would include income from positions held, dividends, interest, rents, copyright and patent royalties, fees and other profits derived from property.

The proposed framework would broaden the contribution base beyond salaries and seek to bring a wider range of income into the social insurance system.

France’s Unrest Exposes the Failure of Macron’s Centrist Political Model

19 October 2026 at 02:54

What began as a student protest over deteriorating schools has developed into a nationwide revolt against economic hardship, political paralysis and declining public services. With the 2027 presidential election approaching, the violence has exposed problems that neither the government nor its principal opponents have convincing plans to resolve.

France’s latest wave of unrest has developed into one of the most serious domestic crises of Emmanuel Macron’s presidency. More than 550,000 people participated in demonstrations on 17 October, according to official estimates, before violence spread through Paris and other major cities. Shops were looted, police confronted rioters, and the historic town hall in Limoges was largely destroyed by fire.

The scale of the destruction prompted emergency government consultations and a televised presidential address. Macron promised to prosecute those responsible, while stopping short of declaring a state of emergency. Yet the immediate security challenge conceals a more difficult political question: why have protests that began with relatively specific demands over education become a confrontation involving such different sections of French society?

From school protests to a national revolt

The movement originated among secondary-school students demanding better facilities, more teachers and improvements in educational standards. Their complaints subsequently attracted trade unions, workers, farmers and elements of the Gilets Jaunes, the Yellow Vest movement that challenged Macron’s government in 2018.

The resulting coalition has no coherent political programme. Students protesting overcrowded classrooms share demonstrations with workers concerned about purchasing power and motorists angered by fuel prices. Their interests are not necessarily compatible, but they reflect a common dissatisfaction with the government’s ability to deliver functioning public services while containing living costs.

This distinction matters. The presence of masked rioters and organised groups engaged in violence does not establish that the hundreds of thousands who demonstrated peacefully supported their actions. Equally, the destruction of public buildings, attacks on police and widespread looting raise legitimate questions about the state’s capacity to maintain public order.

The economic problem behind the protests

At the centre of the discontent lies a structural problem that successive French governments have struggled to confront: the distribution of public expenditure between an ageing population and the services required by younger generations.

A French government budget assessment published in October revealed that pension obligations accounted for approximately 32 per cent of the education ministry’s budget, including €28.5 billion in pension expenditure. These obligations restrict the resources available for other departmental priorities.

France nevertheless remains a substantial spender on education. According to official figures, expenditure reached €199.2 billion in 2025, equivalent to 6.7 per cent of GDP. However, after inflation, the annual increase was only 0.1 per cent.

The issue is therefore not simply how much France spends, but how efficiently resources are allocated and whether expenditure meets changing educational needs.

The OECD’s 2025 PISA assessment found that French pupils’ performance in mathematics and reading had declined compared with 2022. Results were among the country’s lowest recorded, although broadly comparable with the OECD average.

These figures give the student protests a significance extending beyond the immediate condition of classrooms. They raise questions about France’s longer-term economic competitiveness and its capacity to provide younger generations with opportunities comparable to those enjoyed by their predecessors.

The limits of Macron’s reform programme

Macron entered office in 2017 promising to modernise the French economy and overcome the traditional division between left and right. Nearly a decade later, his administration faces a fragmented parliament, constrained public finances and growing resistance to further structural reforms.

The suspension of his pension reform illustrated the difficulty. Raising the retirement age was intended to reduce pressure on the pension system, but parliamentary opposition forced the government to defer the measure until after the presidential election.

The underlying financial pressures have not disappeared. Nor can they be resolved easily through additional spending when public debt, borrowing costs and budgetary obligations already restrict the government’s room for manoeuvre.

This creates an uncomfortable political reality: the state is expected to provide better services, greater purchasing-power protection and stronger security, while the available resources remain limited.

Can the opposition benefit?

The unrest comes approximately six months before the presidential election, with Marine Le Pen’s National Rally and Jean-Luc Mélenchon’s France Unbowed competing to establish themselves as alternatives to Macron’s political centre.

Le Pen has sought to combine support for economic grievances with demands for tougher policing. That position may attract voters concerned by the violence, but it also exposes tensions within a movement that previously supported the Yellow Vest protests.

Mélenchon faces a different difficulty. Supporting demonstrations against government policy is consistent with his political programme, but the involvement of violent groups risks shifting public attention from social demands towards questions of security.

A recent presidential opinion poll even suggested that Le Pen and Mélenchon could contest the final round, illustrating the weakening position of more conventional political alternatives.

Neither, however, can escape the fiscal constraints that have frustrated Macron’s government. A change of president would not automatically provide the resources required to expand public services, reform pensions and reduce the deficit simultaneously.

A wider problem for France and Europe

President Donald Trump has attributed the French unrest to immigration, although the movement’s documented origins lie principally in education, living costs and dissatisfaction with public services. Without established evidence about those responsible for individual acts of violence, broader claims about the demonstrators’ backgrounds remain speculative.

For the European Union, France’s instability carries consequences beyond its domestic political debate. France is central to European defence, fiscal negotiations and support for Ukraine. Sustained political paralysis would complicate its ability to negotiate and implement decisions requiring substantial public expenditure.

The immediate task for Macron’s government is to restore security without allowing the legitimate grievances of peaceful demonstrators to disappear from political consideration. The more difficult task will fall to whoever enters the Élysée in 2027.

France’s crisis is not simply a repetition of the Yellow Vest movement. It reflects a growing conflict over public resources, expectations of the state and the ability of established political institutions to reconcile competing demands.

The violence may subside, but the economic contradictions that brought such different groups onto the streets will remain. The presidential election will determine who inherits them, rather than whether they exist.

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