A total of 28-30,000 will leave the civil service by the end of the year, in an initial stage, according to decisions taken late Sunday night by the Cabinet, chaired by prime minister George Papandreou, which discussed the final agreement reached with the European Commission (EC), European Central Bank (ECB) and International Monetary Fund (IMF) 'troika' on the government's reserve labour measure. According to a government announcement, some 18-20,000 civil servants will be placed in reserve labour, while 7-8,000 will be laid off with severance pay, which will result in 300 million euros in fiscal savings in 2012.

The main criterion for the reserves/layoffs will be how close to retirement the employee is, affects both the core and the wider public sector, and will chiefly apply to civil servants with private law indefinite contracts who are above the age of 60 and are due for retirement in the next 1-2 years.

The employees placed in reserve labour will receive 60 percent of their basic salary for the time they are in reserve, after which they will receive full pensions, while their organic positions (positions they occupied in the civil service) will be abolished.

Another estimated 1,000 primary and secondary education employees and employees in state agencies to be abolished or merged will also be placed in reserve labour and receive reorientation via the state-run Manpower Employment Organisation (OAED) programmes. Those who are not absorbed after the reorientation will be laid off with severance pay.

A further 1,000 civil servants who had reached retirement age but continued working by virtue of an arrangement in the social security law brought by then employment and social security minister Andreas Loverdos, in order to receive a larger pension, will be immediately retired.

Also, 6-7,000 more civil servants will be laid off as a result of the abolition of regional branches of Ministries and Public Services if they refuse to be transferred to other services after the abolition of their organic positions.

The second stage of the streamlining of the public sector concerns the two-year period 2012-2013 when, based on an awaited study by the OECD (Organisation for Economic Cooperation and Development) on the organisation and operation of the total services of the Ministries and Public Services, all the employees will be evaluated, under the supervision of the Civil Service Hiring Examinations Board (ASEP) and EU experts, and those deemed inadequate will be placed in the labour reserve.

The government announcement further said that main opposition New Democracy's (ND) own proposal on reserve labour had been discussed in depth, and it was ascertained that it affected double the number of civil servants (60,000 instead of 30,000), would put the employees in a long period of reserve, would also affect young and productive employees and deprive Public Administration of experienced staff indiscriminately, while the fiscal benefit that would result is equal to that arising from the detraction of the benefits that are being abolished with the introduction of the new uniform salary scale.

Sources told AMNA that interior minister Haris Kastanidis and MPs Fofi Gennimata and Mariliza Xenoyiannakopoulou, during the Cabinet discussion, expressed reservations over the abolition of certain state agencies.