Five new support schemes announced as Cyprus enters recovery stage

The five new economic support measures budgeted at 150 million euros that aim to cushion the blow of the coronavirus pandemic as Cyprus enters the stage of recovery were submitted before the cabinet on Tuesday.

The new schemes will run until October 12, and will be applied retroactively from June 13 when previous measures expired.

Speaking after the meeting of the cabinet, finance minister Constantinos Petrides said “the pandemic caused a global shock. Compared to other countries, Cyprus dealt with the crisis successfully. We acted quickly. On an economic level we acted immediately and with coordination.”

Petrides noted that overall, the island’s economic support programmes since the pandemic broke out surpass 3 billion euros, of which the government’s subsidy scheme that will run until October will amount to 500 million euros.

Detailing the new schemes that were approved by the cabinet, labour minister Zeta Emilianidou were in line with the government pledge to provide a safety net for employees affected by the outbreak of coronavirus.

Four of the new schemes target workers and businesses, while the fifth seeks to support the unemployed, she said.

Participants in the new schemes will be tied by conditions forbidding them to lay off staff for economic reasons, while their eligibility for participation in terms of the extent of their drop in turnover will need to be certified by a qualified accountant.

The new support schemes

The first scheme targets hotel units and tourist accommodation.

According to the scheme, until July 31, it will cover 90% of employees in a businesses that resumed operation if that business has had a fall in turnover of over 40%, while 80% of employees will be covered for businesses that do not resume operation.

From August until October 12, the scheme will cover 50% of employees if businesses that reopened to the public are experiencing a drop in turnover of more than 35%. For those that remained closed, the scheme will continue to cover 80% but the government said it reserves the right to re-evaluate this figure.

The scheme will cover 60% of employees’ wages, with employers tasked with covering the remaining sum.

Conditions for businesses wishing to participate in the scheme are that must have not laid off any staff for financial reasons from March 1, with this condition extending until October 31. Hotels and tourist accommodation units are also required to offer attractive offers to boost local tourism, with the deputy tourism ministry to be keeping track if participants are abiding by this condition.

The second scheme targets economic activities linked or affected by the tourism sector, as well as those who remain closed as a result of coronavirus decrees. The scheme will run until August 31.

Until the end of July, businesses that resume operation and that record a drop in turnover of over 55% will see the government cover 60% of all their employees’ wages if they employ up to three people, while for those businesses employing over three people the scheme will cover the same percentage of the wages of 60% of employees.

The scheme will cover 60% of the wages of 80% a business’ employees if it remains closed.

In August, the scheme will remain the same for businesses employing up to three people, but businesses that record a drop in turnover of over 40% are also eligible.

For businesses employing over three people and that record a drop of over 40%, the scheme will cover 60% of the wages of 45% of employees in August.

The third scheme targets specific economic activities that saw a reduction in turnover of more than 40% in June and July, when the scheme will cover more than half the amount of 45% of salaries, and a drop of more than 35% in August, when the scheme will cover more than half of the amount of 40% of salaries.

Excluded from enjoying the provisions of the scheme are retail businesses, hospitals, pharmacies, the construction sector, and many others.

The fourth scheme, which will run until the end of August, targets businesses that are unable to resume operation due to decrees issued by the Health Ministry.

The scheme will cover 60% of the wages of all employees of businesses employing up to nine people, and the same rate of 90% of employees of businesses employing more.

The fifth scheme will target the unemployed, who have exhausted their right to receive an unemployment benefit in any of the months between January and June this year.

The scheme will see beneficiaries receiving a one-time subsidy of 360 euros.