Germany Puts Plans to Postpone Greek Pension Cuts On Ice



The saga over whether pensions in Greece will be slashed or not from January 1 took another twist as Germany signaled that the decision will not be reached until December.

Athens argues it has enough fiscal leeway to unwind cuts in pensions of up to 18 percent while maintaining the healthy surplus its lenders say it needs in order to keep its finances on a sustainable trajectory.

Government officials have appeared confident that an agreement would be reached to put mandated pension cuts on hold.

However, on Friday finance ministry officials in Berlin said that the decision will be made in December and dismissed as “speculation” reports that Chancellor Angela Merkel is sympathetic to the Greek demand to put pension cuts on hold.

A report in Deutsche Welle, citing German officials, says that the final decision will be taken by the Eurogroup after it considers the report by the international creditors on their first post-bailout inspection of the country’s finances and after the Greek budget for 2019 is submitted and approved by the European Commission.