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Minister of Labour to submit mediation proposal on CoLA

03/04/2023 07:24

Minister of Labour and Social Insurance Yiannis Panayiotou said on Friday he will submit a mediation proposal to the social partners (trade unions and employers) with a view to reaching an agreement on the issue of the Cost of Living Allowance (CoLA).

Panayiotou who continues separate contacts with the social partners, met today with the trade unions of the public sector.

Stating that it is necessary to reach an agreement on the matter, Panayiotou added that “judging that a mediation proposal by the Ministry would contribute to this we have the intention to do so.”

He said that “the framework of the discussion is clear, CoLA will not be abolished, CoLA will not be paid at 100% and the agreement should be renewed.”

Commenting on a recommendation by the IMF against any upward revision of CoLA, the Minister noted that it is understandable for different views and approaches to exist on the matter.

He noted that the Ministry knows what affects public finance very well and has estimated all scenarios concerning the CoLA payment.

Whatever we have in mind and whatever will be submitted or agreed upon it will be within the fiscal capabilities and within the capabilities of the economy, he added.

On his part Stratis Mattheou, head of PASIDY, the Public Servants trade union highlighted that Panayiotou next week will submit a mediation proposal.

Cyprus froze CoLA during the financial crisis while a 2017 transitional agreement providing that CoLA would be given once a year provided the economy shows growth in the second and third quarters of the previous year. Under the agreement the CoLA indexation would be incorporated into basic salaries and consists of 50% of the annual increase in the Consumer Price Index. The agreement was also extended until the end of 2021. Before the 2013 crisis CoLA was calculated every six months.