The attempt made between the Ministry of Finance and the Parliament, on the initiative of the latter, to modernize the parliamentary allowance (salary) to be in line with those in force in other Parliaments finally ended in failure and the issue was left to fade. The aim of this effort, which was undertaken at the request of several MPs and parties, was to define the methodology of payment of parliamentary allowance in order to correct the various paradoxes and distortions of the past when MPs used to increase their earnings through the allowances they received.
Precisely in order not to provoke a popular reaction, they did not increase their basic salary, but the performance and secretarial services allowances that are still granted today in addition to their salary, making them, in fact, pensionable. The issue is expected to be raised again with the election of the new Speaker of Parliament next May, as the current phase is not appropriate due to many other and much more serious issues that were given first priority in the Ministry of Finance. Issues that need to be addressed immediately and are related, on the one hand, to the coronavirus pandemic and, on the other hand, to the lack of liquidity due to the vote against the state budget for the year 2021.
According to the salary statement of a Member of Parliament that we secured for the month of November 2020, the total monthly salary of the Member of Parliament amounts to 6,696 euros as follows:
- * Basic salary – 3,700 euros.
- * Allowance for secretarial services – 1,025 euros.
- * Performance allowance – 1,708 euros.
- * Induction allowance – 261 euros.
The total monthly cuts of the deputies amount to 2,882 euros, as follows:
* Income tax – 856 euros.
* Contribution for widow's pension – 200 euros.
* Officials' pension plan – 455 euros.
* Reduction of earnings due to financial measures – 692 euros.
* Gesy contribution – 177 euros.
* Party contribution – 500 euros. The amount of this monthly contribution varies from party to party.
As it results from the above, the net monthly salaries of the deputies amount to 4,174 euros. To this amount is added the travel allowance which is a lump sum of compensation and amounts to 580 euros per month. This amount is deposited separately from the accounting department of the Parliament and is not included in the payroll of the General Accountant. Therefore, based on the above, the deputies put in their pockets 4,754 euros net per month. Were it not for the party contribution, the net monthly earnings of MPs would have ranged between 5,000 and 5,250 euros a month.
Retroactive and social insurance
There are no deductions for social security from the salaries of the deputies because the money they receive together with the allowances are not considered as a salary but as compensation. However, this non-salary allowance consists, inter alia, of pensionable benefits. Until recently, deductions were made for the purposes of contributions to the Social Insurance Fund from the monthly salary of the Speaker of Parliament, in the same way that it applies to employees participating in a professional pension plan, ie to permanent civil servants. When Dimitris Syllouris asked to know the reasons, it was found that the cuts were made due to a misinterpretation of the current legislation.
According to the earnings statement we publish, for the year 2020 the deputies received retroactive amounts which are due to the way of calculating their salary which is done based on indicators of the Department of Statistics and Research that are issued a year later! It is no coincidence, after all, that MPs are asking for a modernization of their parliamentary allowance, because they themselves do not know exactly how their salaries are calculated. For example, when we asked the MP who gave us the status of his salary, he did not know why he receives retroactively from January 2020. As we were told by the Parliamentary Accounting Office, there were cases where the specific index of the Department of Statistics and Research was negative and then the corresponding cuts were made from the remuneration of the deputies.
In particular, Law 79 (I) / 1995 stipulated that the annual salaries of members of Parliament are adjusted: (a) according to the fluctuation of the index and (b) the annual rate of increase of salaries and wages of employees according to official data of the Department of Statistics and Research. The paradox in this case is that MPs do not know exactly the compensation they are entitled to at the time they receive it, because it is calculated / adjusted about a year later, when the Department of Statistics will calculate the specific indicators with the annual salary increase. and wages of employees. Hence the retrospectives in the salary situation of the deputies.
Tax-free and pension at 60
MPs as well as ministers are the only officials who receive a state pension from the age of 60, meaning that they are no longer MPs or hold any other function or office in the Republic. The tip is paid at the end of their term of office and is tax-free, in contrast to the applicable for civil servants and employees of the wider public sector for whom any lump sum or tip is earned for their service from 1/1/2013 and then subject to the imposition of income tax, in accordance with the provisions of the Income Tax Law, which was amended at the suggestion of the troika, but the deputies when they passed these bills excluded themselves.
It is emphasized that for the purposes of applying the principles of equal treatment and equality, the president of DISY Averof Neophytou submitted a bill to the plenary of the Parliament asking to extend the starting age for the payment of pensions and MPs as well as ministers from the 60th to the 65th year the common mortals. The bill was recently discussed at a meeting of the parliamentary Finance Committee where it is pending.
According to Law 49 (I) / 1980 on Pensions (Certain Officials of the Republic) and Law 88 (I) / 2011 on Pensions of State Officials (General Principles), the pension and gratuity of a Member of Parliament with a parliamentary term, ie 60 months , amount to 1,352 per month and 75,729 respectively, while for an MP who has completed two parliamentary terms, ie 120 months, the pension amounts to 3,306 per month and the tip to 185,115.
The monthly allowance for secretarial services of 1,025 euros is intended to cover the costs of hiring secretaries by the deputies themselves. This allowance was introduced before the institution of the parliamentary associate was created. Members never hired a secretary. The parliamentary associates at the disposal of the deputies and the parliamentary parties are paid by the state. It is also noted that the allowance for secretarial services is considered a pensionable benefit and therefore with their departure from the parliamentary office they receive an increased pension of 513 per month and an increase in the tip of 28,704 in the case of two-term MPs. The monthly performance allowance of 1,708 euros received by the deputies is also considered a pensionable benefit. Therefore, with their resignation from the parliamentary office, the MPs with an increase of 973 per month and an increase in the tip of 54,481 receive two terms of office. The performance allowance is increased with the respective index adjustments. It is noted that both of the above allowances are taxed from 2013.
Double trips for party leaders
The monthly travel allowance amounts to 580 euros per month and is received by all MPs without exception for their participation in the sessions and other work of the Parliament, whether they come from Nicosia or Paphos or Kokkinochoria. This allowance was set as a single lump sum compensation for travel expenses for all members of Parliament, regardless of their place of residence, by decision of the Council of Ministers on 13/7/2005. Until July 2005, travel expenses were received only by MPs residing outside Nicosia, as follows: For MPs residing in Paphos, a travel allowance of 384 euros per month was granted, for MPs residing in Limassol and Paralimni – 213 euros per month and for the deputies of Larnaca – 128 euros per month. With the decision of the Council of Ministers on 13/7/2005, all the deputies increased their monthly salaries as the travel allowance increased. Those who benefited most then were the Nicosia MPs, who suddenly found themselves receiving a tax-free travel allowance which until 2013 was 683 euros per month and decreased by 15% due to the financial crisis.
It is emphasized that the flat-rate monthly allowance for travel is paid regardless of the presence or absence of Members in the sessions of the parliamentary committees and the Plenary Session. It is also paid during the summer period when the Parliament is on vacation.
It is also noteworthy that the leaders of the major parties receive this travel allowance in duplicate. This is because the state offers them a guide – a police officer and in parallel with the state sponsorship that the big parties receive, they also buy a limousine with which their leaders travel. Therefore, they have no travel expenses at all. At the same time, the leaders of the major parties put in their pockets the 580 euros a month that they receive as travel expenses in the exercise of their parliamentary duties.
The highest paid by MPs
According to the General Accountant of the Republic, the ministers, the deputy ministers and several commissioners are paid almost the same as the deputies, with their net earnings ranging at 5,000 euros per month. The following civil servants and officials have higher salaries than MPs, who have a net monthly salary of more than 5,000 euros: Attorney General, Assistant Attorney General, President of the Supreme Court and judges of the Supreme Court – 8,251 euros, President 7,102, President of the District Court – 6,703 euros, Chairman of the Commission for the Protection of Competition – 5,908, Commissioner for Health Surveillance – 5,900, Speaker of Parliament – 5,852, Chief Registrar, Chief of Police, Commander of the KYP, Director Generals 5.708, Commissioner of Administration – 5.260 and Director of the Office of the President of the Republic – 5.125.
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