Labour Minister Marinos Mousiouttas has ruled out proposals to raise pensions by 125% , while stressing that any increases must remain compatible with the sustainability of the Social Insurance Fund and fiscal stability.

Speaking to CyBC radio on Friday, Mousiouttas said minimum pensions would be substantially higher than they have been in recent decades but ruled out proposals that would raise them from the current €450 per month to €1,088.

“It is not possible for a pension of €450 to increase by 125 per cent to €1,088,” he said.

The minister suggested that public debate on the level of the minimum pension should be suspended until the government presents its full pension reform package, which is expected by the end of June.

He stressed that any decisions on pension increases must take into account the country’s fiscal framework and the limits within which the executive branch can operate.

Calling for patience, Mousiouttas said all aspects of the planned pension reform would be announced before the end of the month.

He also revealed plans to meet all parliamentary parties during the summer to brief them on the contents of the proposed legislation, which is expected to be submitted before parliament closes for its summer recess.

The meetings, he said, would ensure MPs are informed about the main provisions of the reform and any specific issues arising from the new legislative framework.

Mousiouttas said a number of factors must be taken into account when determining pension levels, adding that once all the relevant data are presented, “many of the proposals made during the election campaign will be revised”.

“The Social Insurance Fund is not an inexhaustible source of money,” he said. “There are limitations, and both the sustainability of the fund and the safeguarding of fiscal stability must be taken into account.”

The minister said the necessary studies had already been completed and assured pensioners that increases would be granted to the maximum extent possible without undermining the long-term viability of the Social Insurance Fund or affecting broader economic policy.

Meanwhile, the Cyprus Employers and Industrialists Federation (OEV) expressed concern over public statements advocating pension increases at what it described as levels “outside economic reality”.

In a statement on Friday, OEV said discussions on pension reform could not be based on “oversimplified approaches” or the cultivation of expectations of “magic solutions”.

The organisation argued that any substantial increase in pensions would require either higher social insurance contributions, an increase in the retirement age, or a combination of both.

“Any other approaches create expectations that cannot be met because they are based on unrealistic assumptions,” OEV said.

The federation added that it would not support proposals that could undermine the sustainability of the Cypriot economy, stressing that decisions on the pension system must be made with a long-term perspective and on the basis of proportionality between contributions and benefits.

It also said pension increases should be linked to economic growth rates and internationally recognised best practices governing pension systems.

OEV called on all stakeholders to allow the issue to be handled through the institutions of tripartite cooperation and the social partners, while arguing that any further strengthening of the state’s social policy should not be financed through the Social Insurance Fund or the second pillar of the pension system.