Frustrated with stalled firings and foot-dragging, Greece’s international lenders have given the government until the end of the week to pass reforms or face losing its next loan installment of 8.1 billion euros ($8.1 billion) four Eurozone officials said to Reuters.
The news came as envoys from the Troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) were back in Athens to meet government officials and review long-stalled progress on a series of delayed reforms.
The negotiations were pushed back two weeks so that Prime Minister Antonis Samaras, who vowed he would never again impose austerity measures but is staring them in the face again with the unraveling of a privatization program and a 1 billion euro ($1.3 billion) hole in the country’s health care insurance system, could deal with the fallout of his closing of the national broadcaster ERT and firing of its 2,656 workers.
There is a general dissatisfaction with the government’s unwillingness and inability to reform reform its public sector, such as tax and custom collection or health care services, a senior Eurozone official involved in negotiations said. “All agreed that Greece has to deliver before the Eurogroup on Monday (July 8.) That΄s why they must present again on Friday,” a second source said.
To pressure Athens to deliver on reforms, the Troika might refuse to pay the full sum in one go and break it up into three monthly payments instead, Greek media reported, terms it doesn’t want to give beleaguered Greeks who can’t pay their taxes which have been doubled in some areas to go along with big pay cuts and slashed pensions.
“It is a very difficult negotiation,” a senior Greek official participating in the talks said. “We΄re moving fast to wrap up as many issues as possible a soon as possible,” the source said, although other reports said Greece is barely moving at all.
After meeting with Labor Minister Yiannis Vroutsis, Troika envoys reportedly said that by the end of the year the procedure for massive firings be changed and every obstacle imposed by law be lifted to make it easier to get rid of public workers. Vroutis said that, “There is no issue of reducing the lowest salary and of mass firings,” directly contradicting reports that said there were.
The IMF’s point man in Athens, Poul Thomsen, said he wants “modernization” of Greece to meet European standards and a change in the law so that the Labor Minister doesn’t have to sign off on the firings.
This new framework will enable mass firings, such as what happened at a cement factory in northern Greek, where the minister’s approval was sought to fire 266 workers after the factory was closed and they had already been fired. The Troika also wants the merging of businesses and banks to be allowed and accelerated.
Vroutsis said the government is also going to discuss the current methodology of businesses paying only 1 euro of each 1,000 into the country’s unemployment fund. He said the government is hoping to find another solution so that pensions won’t have to be cut 30 percent, which Samaras vowed he wouldn’t do under any circumstance, unless he was forced to do so.
(source: capital)
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