While Europe promotes budgetary discipline, Greek deficit soars again. The constant requirements for pension payments and other obligations, and the estimate that the property tax will raise only €1 billion, instead of €1.6 billion, cause jitters to the Greek government.
“If no immediate action is taken, 2011 deficit may close at double-digit figures”, said a government official. Now, Greece focuses to achieve a target of 9.5% of GDP, not 9%.
But the government must also convince the Troika at the tough negotiations that start on Monday on the new loan package and MoU. Greece may be requested to adopt new additional measures.
Regarding taxation, Greece has to cover a gap of €600-700 million, due to the shortfall in property tax. In expenditure, the large deviations in funds may bring new changes in pensions.
The Troika also examines in detail the overall divergence of public expenditure, along with the measure of labour reserve. The measure of immediate redundancies is considered the last resort, as it is a constant request of the international lenders, but Greek government fears the political cost.
Government officials say that they will try to convince the Troika to give Greece time to adopt structural measures in the next review in February-March. However, the possibility of immediate interventions is open.
Figure reveal that the deficit in 10-month period was €23.1 billion, exceeding 10% of GDP, while information indicates reduction in revenues by 13% in November, and arrears reaching €6.7 billion.
(source: capital)
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