Cyprus social spending rises in GDP share but falls in absolute terms

Total expenditure on social protection benefits in the EU reached €4.92 trillion according to early estimates for 2024 released on Friday by Eurostat.

This marks a 6.9 per cent increase compared with the previous year of 2023.

Data showed that social protection benefits expenditure represented 27.3 per cent of the EU’s Gross Domestic Product.

Eurostat also reported that this percentage indicates a 0.6 percentage points increase compared with 2023.

The situation in Cyprus shows its expenditure on social benefits was considerably below the EU average, reaching 19.13 per cent of GDP in 2024.

This figure for Cyprus is an increase of 0.34 percentage points from the 2023 level of 18.79 per cent of GDP.

In terms of absolute value, Cyprus’ social benefits expenditure for 2024 stood at €6.65 billion.

This is a decrease of approximately 3.44 per cent from the 2023 expenditure of €6.89 billion.

“In 2024, social protection benefits expenditure increased in all EU countries,” Eurostat data suggests.

Among all EU countries, social protection benefits expenditure as a percentage of GDP was highest in Finland at 32.5 per cent of GDP.

It was followed by France at 31.9 per cent and Austria at 31.8 per cent.

The lowest expenditure as a percentage of GDP was recorded in Ireland at 12.4 per cent, Malta at 13.4 per cent, and Hungary at 16.6 per cent.

The largest component of the total expenditure was for old age benefits, which accounted for €2.04 trillion and 41.5 per cent of the total.

Sickness and health care benefits were the second-largest category, amounting to €1.46 trillion and 29.7 per cent of the total.

Other social protection categories included disability, survivors, family and children, unemployment, housing, and social exclusion not classified elsewhere.

The largest expenditure increases compared with 2023 were recorded in Estonia at 19.5 per cent, Croatia at 17.8 per cent, and Romania at 17.5 per cent.

The smallest increases in social protection benefits expenditure were registered in Greece at 3.2 per cent, Sweden at 3.9 per cent, and Italy and Denmark, each at 4.3 per cent.