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Vroutsis Insists No More Austerity

Greek Labor Minister Yiannis Vroutsis
Greek Labor Minister Yiannis Vroutsis

Despite an International Monetary Fund (IMF) report that there could be a hole as big as $14 billion in the Greek economy that needs filling, the coalition government led by Prime Minister Antonis Samaras has no plans to institute more austerity measures, including abolishing the two-months bonus pay that is still active for some private sector worker, Labor Minister Yiannis Vroutsis said.
He was responding to claims that the Troika of the European Union-IMF-European Central Bank will want more harsh reforms when its envoys return to check the books in Athens in September.  “There is no issue regarding the lowering of the minimum wage before 2016, nor abolishing of the 13th and 14th salaries,” Vroutsis insisted. Previous governments made the same kind of statements just before imposing more tough conditions.
Greece reduced its minimum wage to 585 euros last ($781.6) before taxes last year. At the end of 2016, a new system will be used to calculate the salary level and there are fears it could fall even further as the government wants Greek workers to be competitive with those in poorer, neighboring countries and others.
Administrative Reform Minister Kyriakos Mitsotakis became the latest cabinet member to suggest that the New Democracy-PASOK coalition, as well as Greek society, would not be able to cope under the possible pressure for new measures in the fall. “We can get better value for money and meet the commitments of my country,” Mitsotakis said with regard to public sector reform.
“But our creditors must understand that the main risk today is if they try for more measures – any further attempt to tax incomes will not fly,” he added. “Austerity has been pushed too far. When our prime minister meets with President Obama this month, one of his main messages will be this.”
Mitsotakis’s comments came just a few days after Finance Minister Yannis Stournaras told Reuters that the biggest threat to Greece’s adjustment program was not economic failure but austerity fatigue among coalition MPs. “MPs just reflect the average man or woman in the street – they have to believe that there is light at the end of the tunnel,” he said last week. “If they believe it, they will continue voting the few necessary measures left over; if they don’t, they are not going to. This is the great risk.”

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