Troika Wants More Salary Slashes



salary cutsGreek Prime Minister Antonis Samaras’ vow not to administer more austerity measures has run headlong into demands by international lenders for lower salaries for new hires, no hikes in the already-cut minimum wage and salary cuts for some civil servants.

The new developments came out of long-stalled talks with envoys of the Troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) which is holding up release of a nine billion euros ($12.48 billion) installment that Greece needs to help meet a 10 billion euros ($13.87 billion) bond payment in May.

The stalemate has ended any hope Greece had of reaching an agreement over 153 unresolved reforms identified by the Paris-based Organisation For Economic Co-Operation and Development (OECD) before a March 10 meeting of Eurozone finance ministers that could have released the held-up installment.

The salary cuts were a new issue and the newspaper Kathimerini said it was told by sources it didn’t name that the Troika wants the starting pay of new hires with college degrees, currently set at 1,090 euros ($1512) monthly to be cut, but the amount of the reduction was not revealed.

Despite Samaras’ vow, it was reported that has has given in to the demand although it was not said how the government has reacted to the additional demand that automatic increases for private sector workers paid the minimum wage of 586.08 euros monthly ($813.30) be scrapped and their pay not be allowed to increase.

Sources said the Troika wants the new scheme to allow employers to keep workers on the same pay regardless of the time they have served, essentially freezing their salaries for an unlimited time.

Under current labor legislation, workers earning the minimum wage see their salary increase by 58.61 euros per month every three years. Under the proposed scheme, a worker over the age of 25 with nine years’ service would, for example, see wages cut by 175 euros ($242.84) per month.