Greece’s Minister of Labor, Social Security and Social Solidarity Effie Achtsioglou insisted in a letter published Friday in the Financial Times that Greek pensioners have barely enough to live on and urged International Monetary Fund (IMF) chief Christine Lagarde to listen.
“We cannot accept IMF insistence on further cuts in pensions. As minister for pensions I must answer, hoping that IMF managing director Christine Lagarde will listen,” she said, ahead of Monday’s Eurogroup, in a bid to explain why Greece cannot make any more pension cuts.
“The narrative about Greek pensions is driven by demands of its creditors. They argue that the pension system is overgenerous and a drain on the economy,” she said, adding that it is based on the crude statistic that pensions require annual transfers from the state budget of around 11 per cent of gross domestic product in Greece compared with the eurozone average of 2.25 per cent.
This comparison, she said, is misleading.
“Following the implementation of the new pension law last year, total state financing of pensions is projected at less than 9 per cent of GDP,” she explained.
“The bottom line is that Greece’s old people are much worse off than elsewhere in Europe because they do not have access to other benefits. Per capita income for individuals aged over 65 is about €9,000, compared with €20,000 in the eurozone.” she added, asking “how could the major problem confronting Greece be overgenerous pensions, when 43 per cent of pensioners receive less than €660 a month?.”