Calamos Supports Greece
GreekReporter.comGreek NewsEconomyPension Battle Cracks the Greek Coalition

Pension Battle Cracks the Greek Coalition

A Greek pensioner protests against cuts to benefits

ATHENS – Interim Prime Minister Lucas Papademos’ six-week old shaky coalition government is showing signs of splitting over a refusal by the conservative New Democracy partner to cut auxiliary pensions in another cost-cutting scheme to keep Greece from going broke. Papademos took power on Nov. 11 when former Prime Minister George Papandreou resigned, and is overseeing an administration which includes some of the former ruling PASOK Socialists, New Democracy, and the far Right-Wing LAOS party, but the tripartite partners are wrangling amongst themselves over a number of issues.
Papademos, who said there would be no additional austerity measures, now says he has no choice but to go after the auxiliary pensions earned by workers over their lifetime, which could decimate their benefits, and New Democracy is opposing the idea, saying it did not agree to any more cuts. The government is surviving on a series of $152 billion in emergency loans from international lenders and seeking an additional $175 billion, but both come with conditions of deep pay cuts, tax hikes, slashed pensions, and scores of layoffs. The parties are also trying to position themselves for new elections that were set for Feb. 19 but now seem certain to be delayed because the coalition is far behind schedule in trying to arrange new loans and deal with the crisis.
Papademos is to head a cabinet meeting with the aim of gaining approval for a bill drafted by Labor and Social Insurance Minister Giorgos Koutroumanis, who said the government, which has already taxed workers to the hilt, has to take money from pensioners, although it has largely let tax evaders costing the country more than $60 billion go untouched, apart from a handful of arrests that have resulted in no prosecutions. The newspaper Kathimerini reported that New Democracy ministers are expected to come to the meeting ready to fight the pension cut and likely will suggest the country seek a bigger loan, although it can’t repay them. New Democracy also said the auxiliary pensions were not on the list of demands for revenue cuts from the lenders of the European Union-International Monetary Fund-European Central Bank Troika. But government sources told the newspaper that the pensions are on the chopping block now despite previous promises not to go after them.
New Democracy’s shadow labor minister Nikolaos Nikolopoulos accused Koutroumanis of going against Papademos’s pledge not to introduce any more austerity. Nikolopoulos also accused the previous socialist PASOK administration of “pillaging” the coffers of auxiliary pension funds. New Democracy spokesman Yiannis Michelakis said the party remained committed to its position not to vote for new pay cuts under a transition government. “The task of this government is very specific: Implementation of the decisions made on October 26 (at a Eurozone meeting agreeing on another bailout) for a second financial rescue package,” Michelakis told Antenna television. The warning came hours before a cabinet meeting on the crisis concerning supplementary pension funds, several of which are threatened with insolvency.
Michelakis said previously that the crisis has worsened because of what he said were indiscriminate hirings by PASOK even while the previous government was cutting people’s pay and setting in place a scheme to lay off 30,000 workers. He said PASOK hired 10,862 civil servants, packing them onto a bloated public payroll of political hires the Troika said is largely to blame for the crisis. He said four of the new workers were added to the office of Alternate Finance Minister Pantelis Oikonomou the week before Papandreou’s government fell.
(Sources: Kathimerini, Athens News, Reuters)

See all the latest news from Greece and the world at Greekreporter.com. Contact our newsroom to report an update or send your story, photos and videos. Follow GR on Google News and subscribe here to our daily email!



Related Posts