Trade union Sek has warned that policy failures and lack of strategic planning continue to impose a heavy burden on society, particularly amid rising energy costs.

The organisation stressed that in every increase in international energy prices, the greatest impact is felt by workers in middle and low-income groups.

“The rise in prices of products and services due to the surge in energy costs is certainly not a new phenomenon,” said Sek economic studies department officer George Pirishis.

“We have experienced it globally during the 2007 economic downturn, the 2020 to 2021 pandemic crisis and the current conflict in the Middle East,” he added.

“The conclusion is clear that in every rise in international energy prices, those who bear the greatest cost are workers in middle and low-income groups,” he continued.

Pirishis stressed that “this is a consistent finding supported by data from the Statistical Service of Cyprus and household budget surveys”.

He raised concerns over how these vulnerable workers are effectively protected under current policies.

In remarks shared in the union’s own publication, Sek pointed out that temporary measures such as VAT reductions and lower excise duties are welcome but insufficient.

“These measures are temporary solutions that do not resolve the problem,” Pirishis said.

“What is needed are structural changes, as rising energy costs inevitably erode purchasing power and put downward pressure on wages,” he added.

“The core issue is that increased energy costs are passed on to final prices of goods and services,” he explained.

According to Sek estimates, this phenomenon has been particularly intense in Cyprus during periods of economic and health crises, which tend to boost corporate profits while reducing the real value of wages.

The union warned that the situation is further aggravated by the absence of effective structural policy measures.

Sek also highlighted the urgent need to strengthen public transport, describing it as a necessary long-term investment.

“Has anyone ever calculated the fiscal cost of continuously supporting businesses and consumers due to our economy’s near-total dependence on fuel oil,” Pirishis asked.

“It could amount to hundreds of millions if proper infrastructure planning had been implemented earlier,” he added.

He also pointed to policy shortcomings in renewable energy management, particularly the loss of significant output.

“Another example of policy failure is the loss of half of the kilowatt-hours produced from renewable energy sources due to grid curtailments, resulting in millions in costs and burdening consumers who invested in photovoltaic systems,” he said.

“This happened because the state did not proceed in time with the installation of energy storage batteries for renewable energy,” he added.

“Problems cannot be solved with temporary measures, as what is required is long-term strategic planning without fragmented policies,” Pirishis said.

“Such planning must emerge from a coherent process capable of addressing our structural weaknesses,” he concluded.