Panayiotis Rougalas
The 2027 state budget, approved by the Cabinet this week, points to an effort to reduce the number of permanent public-sector positions. Even so, the state sector remains large.
According to the budget, the number of posts will fall by 51 compared with the 2026 budget, marking a reduction for the third consecutive year, the Finance Ministry said.
The government plans to create 386 positions and eliminate 437, including 66 permanent posts for hourly-paid government staff.
In its presentation, the Finance Ministry said efforts to contain the public payroll will continue under the 2027 budget. It said total employment in the civil service fell by 2,242 people between 2012 and 2026.
More specifically, the figures cited show 9,529 employees on Jan. 1, 2012, and 17,287 on June 30, 2026. The ministry explained that the latter figure includes about 3,804 employees seconded to the State Health Services Organisation, known as Okypy. If those employees are excluded, it said civil service employment fell by 6,046 people.
Despite the reported decline in civil service employment, the number of people working in education increased by 3,342 over the same period. The figures show 12,789 employees on Jan. 1, 2012, rising to 16,131 by June 30, 2026.
Government workforce reaches 53,080
According to the Cyprus Statistical Service, the number of government employees reached 53,080 in August 2026, an increase of 419 people, or 0.8%, compared with August 2025.
Employment in the civil service fell by 1%, while employment in both the education service and security forces rose by 2.2%.
Across the government workforce, the largest increase was among employees on open-ended contracts, whose numbers rose by 3% compared with August 2025. The number of hourly paid workers declined slightly, by 0.1%.
Looking at individual staff categories, the largest percentage increase was among open-ended employees in the education service, whose numbers rose by 26%. The sharpest decline was among fixed-term employees in the security forces, whose numbers fell by 96.6%.
The Statistical Service said that the steep decline was mainly due to specific fixed-term contracts expiring in August 2025 and not being renewed.
During the January-to-August 2026 period, the average number of government employees increased by 0.4% compared with the same period in 2025.
Wider public sector employs 78,433 people
Taking a broader view, employment across the wider public sector reached 78,433 in the second quarter of 2026. That was an increase of 1,119 people, or 1.4%, compared with the same quarter in 2025.
Of the total, 73,284 people worked in general government and 5,149 in government-controlled companies and enterprises.
General government employment included 55,372 government employees, 11,314 people working for nonprofit organizations, and 6,598 employees of local authorities.
Compared with the second quarter of 2025, employment in general government increased by 1,009 people, or 1.4%, according to the Statistical Service. Central government employment rose by 293 people, or 0.4%, while local authority employment increased by 716, or 12.2%.
The rise in local authority employment was mainly attributed to the District Local Government Organizations, where staffing increased by 416 people, or 39.1%.
Employment in government-controlled companies and enterprises rose by 110 people, or 2.2%.
Compared with the first quarter of 2026, employment across the wider public sector increased by 45 people, or 0.1%.
General government employment rose by 48 people, also 0.1%. Central government employment declined by 144 people, or 0.2%, while local authority employment increased by 192 people, or 3%.
Employment in government-controlled companies and enterprises fell by three people, or 0.1%.
Reform effort remains active
Efforts to modernize the civil service and wider public sector are continuing, with the government promoting what it describes as “a package of reforms aimed at creating a more efficient, flexible, and productive state.”
The government is also working to simplify and digitize procedures and make more flexible use of the available workforce. The longer-term goal is to ensure that public bodies meet their strategic objectives and carry out government policy successfully and on time.
According to the 2027-2029 Strategic Fiscal Policy Framework accompanying the 2027 budget, the reforms will seek to safeguard the sustainability of public finances by limiting the rate at which the state payroll grows.
They will also support the government’s policy of meeting the civil service’s permanent staffing needs by filling permanent positions instead of hiring employees on fixed-term contracts.
At the same time, the government is considering gradually lowering staffing ceilings for temporary personnel.
It also intends to review whether existing posts are still necessary and reconsider organizational structures created under different circumstances in previous years.
The reform is based on the principle that, where possible, every new position created should be matched by the elimination of an equivalent post or by savings elsewhere, preventing any additional burden on public finances.
One of the changes will be the implementation of legislation introducing a new framework for the Public Service Commission to assess and select candidates for promotion within the civil service.
