Ministry of Finance releases budget framework and public wage projections for 2027-2029

The Cypriot Ministry of Finance, via a circular by Director General Andreas Zachariadis, has outlined the 2027 budget and the Medium-Term Budgetary Framework for 2027-2029. The document details projected Cost of Living Allowance (COLA) increases: 0.12% from January to June 2027, 4% from July 2027 to June 2028, 2.5% from July 2028 to June 2029, and 2% from July 2029 to June 2030. Starting July 2027, the COLA will be paid at 100% of the preceding year's increase with a 4% cap. Additionally, a 1.5% general salary increase is maintained for the three-year period along with annual increments. The policy continues the 10% reduction in entry-level salary scales for 2027-2029, with provisions for integration into standard grades after two years of service. Regarding workforce management, the government aims to restrain costs by limiting new hires and maintaining or reducing seasonal and hourly staff levels. The circular highlights that public sector payroll remains the primary state expenditure, necessitating stricter fiscal control despite the scheduled wage adjustments.