Democratic Left chief Fotis Kouvelis reportedly expressed his opposition to plans to revive a labor reserve scheme to reduce the public sector wage bill. A new meeting between Greece’s coalition leaders on Tuesday failed to yield any results, amid objections from junior partner Democratic Left to plans to revive a labor reserve scheme to reduce the public sector wage bill.
Sources told Kathimerini that Democratic Left chief Fotis Kouvelis expressed his opposition to the measure, leaving Prime Minister Antonis Samaras in no doubt that another option should be considered. Kouvelis pointed out that when the scheme was adopted last year, it was soon abandoned as only a few thousand civil servants were placed in the labor pool, where they earn 60 percent of their salary but do not need to go to work.
PASOK leader Evangelos Venizelos is also said to have expressed his doubts about the scheme, but added that he was also against the idea of mass sackings in the public sector.
Sources said Kouvelis was angry that the idea of reviving the labor pool had been leaked to the press and that it was being considered as an option, given that the measure was not contained in the policy framework drawn up by New Democracy, PASOK and Democratic Left before they formed a coalition government.
Earlier, Finance Minister Yannis Stournaras had met President Karolos Papoulias to inform him about the latest economic developments. Upon exiting the meeting, the minister told journalists that the measures was being considered as part of the effort to find the 11.5 billion euros in savings that Greece needs to make over the next two years to satisfy the troika.
“We will look at the labor reserve because the numbers just don’t add up easily,” he said. “11.5 billion euros is a significant number and we haven’t reached it yet. We still need to find 3.5 to 4 billion euros,” added Stournaras, who told Papoulias there was still “hope” for Greece.
Sources said that to find the remainder of the cuts Greece’s lenders are demanding, Stournaras will need to cross some of the red lines drawn by the parties. This includes scrapping the already-reduced Easter and Christmas bonuses for civil servants and pensioners or making cuts to farmers’ pensions.
Speaking to party members earlier in the day, Venizelos doubted whether the cuts would work and predicted that they would worsen the recession, making it last until 2016.