Minister of Labor Yiannis Panayiotou announced changes to the Social Insurance System from 2025, making it more supportive for low pension recipients. He stated that the change would occur without increasing contributions but by enhancing the Fund's investment character. According to the latest actuarial studies, the Social Insurance Fund is viable until 2080.

Yiannis Panayiotou also announced an upcoming bill to be submitted to the Parliament about the 12% penalty for those retiring at 63 years old, with provisions for smaller pension reductions for those who have worked 40 or 42 years.

Meanwhile, DISY and DIKO have jointly submitted a legislative proposal requiring the government to submit a budget for the Social Insurance Fund, akin to the practice for other entities of the General Government. The initiative aims to address longstanding issues regarding the Fund's financial transparency and oversight.

As Brief reports, the bill, co-signed by DISY MPs Haris Georgiadis, Onoufrios Koulla, Savia Orphanidou, and DIKO MPs Christiana Erotokritou and Chrysis Pantelides, seeks to enhance the transparency and control of the Fund's revenues and expenditures. Christiana Erotokritou, Chair of the Parliamentary Economic Committee, commented that the proposal's primary aim is better, more accurate, and transparent management of the Social Insurance Fund.

When asked, Ms. Erotokritou explained that under the current legislative framework, no budget is submitted for the Fund. However, if this proposal is adopted, it will enable the Parliament and the Economic Committee to monitor the Fund's progress and exercise parliamentary oversight as needed.

She added that a budget for the Social Insurance Fund would facilitate better management and enable timely intervention by deputies in potential challenges.

"It's beneficial to budget both the income and expenditure of the Fund. This is another step towards ensuring the long-term stability of the Social Insurance Fund," she elaborated.

In response to a question about the government's practice of borrowing from the Social Insurance Fund for other needs and whether this proposal aims to regulate this issue, Ms. Erotokritou clarified that the proposal's purpose is to enhance transparency regarding the Fund. She noted that this decades-long practice cannot be abruptly changed without creating other problems. Any potential change must be gradual and smooth, aiming to preserve the viability and transparency of both public finances and the country's economic stability.

It is worth noting that, due to this borrowing, the state has accrued a total debt of over €10.1 billion to the Social Insurance Fund, which it is obligated to repay under normal circumstances.

Specifically, the state uses the Social Insurance Fund as a "haven" for borrowing or for other expenses of the Ministry of Labor. This government funding through the Fund is done in two ways: either as a "loan" to be repaid with 3.5% interest or as expenditures decided by the current Minister of Labor. In most cases, however, the state does not repay the borrowed amounts, leading to a total exceeding €10 billion.