Members of parliament retain exemption from Social Insurance Fund contributions whilst receiving substantial pension benefits, despite recent legislation targeting multiple pension privileges across government positions.
MPs contribute only €529 monthly in 2025 to a separate pension scheme administered through the Republic’s Consolidated Fund, compared to standard social insurance requirements applied to other public officials. This arrangement provides access to parliamentary pensions without contributing to the broader social insurance system utilised by Cyprus workers.
Dual employment advantage
The exemption enables MPs to maintain concurrent employment during their parliamentary terms, accumulating additional salary income and insurance units that enhance pension entitlements beyond their parliamentary service. Several MPs have criticised colleagues who continue working whilst holding office, arguing this compromises dedication to demanding parliamentary responsibilities.
Other government officials including the attorney general, deputy attorney general, auditor general, ministers, deputy ministers, and commissioners correctly contribute to the Social Insurance Fund alongside additional €635 monthly payments to the Consolidated Fund pension scheme.
Legal framework excludes parliamentary positions
Investigation reveals MPs avoid social insurance contributions because parliamentary positions fall outside insurable occupations defined in the Social Insurance Law. Parliamentary remuneration does not constitute “earnings” under social insurance legislation as payments represent service rather than employment compensation.
Legal sources note MPs could have implemented parallel reforms alongside recent multiple pension legislation to ensure standard social insurance participation comparable to other Cyprus workers.
Substantial pension entitlements
Current parliamentary pension calculations show annual gross pension benefits of €19,107 and lump-sum payments of €89,166 for single five-year terms. MPs completing two terms receive annual pensions of €52,545 with lump-sum benefits reaching €245,210.
Parliamentary gross remuneration for 2025 totals €7,785 monthly, comprising €4,569 basic salary, €2,191 representation allowance, and €1,025 secretarial services allowance. Monthly pension scheme deductions have increased from €487 in 2023 to €519 in 2024 and €529 in 2025, tracking salary adjustments.
Reform limitations persist
Recent multiple pension legislation addressed some structural issues but failed to resolve fundamental disparities. New regulations exempt current office-holders and certain future officials, whilst potential constitutional challenges remain possible if affected parties pursue legal action.
No comprehensive pension scheme exists covering all official categories uniformly, with legal experts suggesting unified arrangements would better align pension benefits with contribution levels across governmental positions.
The parliamentary exemption is one of only three positions exempt from standard social insurance requirements, alongside the presidency and other senior constitutional offices.
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