By Stelios Orphanides
The government intends to overhaul the country’s pension system and its supervisory institutions and will initiate a social dialogue in this direction in the near future, the finance minister said.
The pension reform will attempt to provide “coverage with concrete and credible incentives and obligations and a revision of the tax approach of the largest possible part of the population,” finance minister Harris Georgiades said today according to an emailed audio file.
The reform will also aim at ensuring “the correct, credible and transparent operation of the funds at a competitive cost internationally” through a new regulatory framework of the quality, he said.
Georgiades added that pension funds will be encouraged to merge and exploit the benefits of economies of scale and create best practices structures that minimize risk as “as the existence of hundreds of funds in a small economy like ours is an oddity”.
In order to strengthen the supervisory and regulatory framework, the government will merge the Insurance Companies Control Service with the Registrar of Occupational Retirement Benefits Fund, which is one of the International Monetary Fund’s recommendations as it would improve the effectiveness and efficiency in supervision, the finance minister said.