Rush to finalize package of measures

Representatives of the three parties in the coalition government are to continue talks over the weekend in a bid to overcome differences on 11.5 billion euros’ worth of painful new austerity measures that Greece must approve to clinch crucial rescue loans. The package -- which is harsher than anticipated, foreseeing 4.5 billion euros in cuts to pensions -- was discussed by the Cabinet on Friday and is to be approved by party leaders on Monday. The blueprint must then be endorsed by officials of Greece’s so-called troika of lenders -- the European Commission, European Central Bank and International
Monetary Fund -- who are due in Athens later next week before it is submitted in Parliament in the second half of September. The troika review will determine whether Athens gets a 31.5-billion-euro loan.

Apart from the 4.5 billion euros in pension cuts, the package also foresees 1.2 billion euros in cuts to the wages of certain categories of civil servants, including military and judicial staff, 1 billion euros in cuts to social benefits, 1.2 billion euros off state administrative costs and 1.4 billion euros off health spending.

Officials of PASOK and Democratic Left -- the two junior coalition members -- are to propose alternatives to some of the harsher measures. Meanwhile Democratic Left is said to be angry with conservative New Democracy’s failure to oblige the Orthodox Church to pay half of clerics’ salaries.

In a speech to party officials on Thursday, Prime Minister Antonis Samaras said new austerity was “inevitable” if Greece wanted to remain in the euro but stressed that there would be no more pain. “This is the last such package of cuts,” he said.

During the cabinet meeting, Samaras asked ministers to try to boost revenue so the country can quit the recession. “If all goes well, Greece will be very different in two years,” he said.

In a speech to Parliament, Finance Minister Yannis Stournaras said the tide was turning. “There is a sense of trust being restored,” he said, noting that deposits had returned to Greek banks and the value of Greek bonds on the primary market had risen. Stournaras is to go to Berlin on Tuesday for talks with his German counterpart Wolfgang Schaeuble, who has been critical of Greek efforts. German Foreign Minister Guido Westerwelle was more supportive on Friday, calling for an end to “Greek-bashing” and expressing confidence Athens will honor pledges.


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