During a May Day event organised by trade union Sek in Nicosia on Thursday, Labour Minister Yiannis Panayiotou reaffirmed the government’s commitment to social justice, outlining a series of ongoing reforms aimed at strengthening the labour market and improving conditions for workers.

Panayiotou said the government was pressing ahead with the reform of the pension system, the modernisation of the cost-of-living allowance (CoLA) mechanism, improved regulation of the labour market and the expansion of collective bargaining agreements.

These efforts, he said, form part of a broader, people-centred strategy for economic growth and social cohesion.

“We are moving forward with confidence and optimism,” the minister said, adding that the government’s agenda aims to ensure progress and prosperity for current and future generations, placing work at the heart of human life.

He expressed respect and appreciation for all workers who, through their daily efforts, contribute to the country’s collective success.

Highlighting the government’s achievements in its first two years, Panayiotou pointed to record employment levels, the lowest unemployment rate in decades, and a significant reduction in the number of low-paid workers.

The minister also cited enhanced health and safety regulations, increased inspections, and the use of technology to combat undeclared work as key successes.

He said that while challenges remain, the progress so far reflects the government’s determination and sense of responsibility.

For his part, Sek boss Andreas Matsas focused heavily on defending CoLA, warning that talk of “modernising” the mechanism raises concerns about its potential dilution or abolition. He stressed that CoLA is a contractual right that restores purchasing power and should not be linked to productivity metrics or subject to change.

Matsas said the trade union movement’s top priority is securing CoLA for all workers under collective agreements, in both the public and private sectors. “Any distortion or cancellation of CoLA,” he warned, “would lead to financial hardship for workers.”

He called for comprehensive collective agreements across all sectors, a substantial increase in the national minimum wage, greater access to affordable housing for young people and a pension system that ensures no retiree lives below the poverty line.

Matsas referenced a recent Sek survey which found that 75 per cent of people are dissatisfied with their salaries due to the erosion of purchasing power, 62 per cent struggle to meet basic needs, and nearly one in four resort to borrowing monthly to get by. “When citizens speak, we must listen, act with purpose, and deliver,” he said.

He also stressed the importance of rejecting populism and superficial approaches in favour of policies that are socially just, ethically sound, and centred on real-life needs.

He urged recognition of Cyprus’s model of a social market economy, distancing it from the positions of international institutions like the IMF, which he said are incompatible with local conditions.