BUSINESS

Handouts for the poor, retirees and PPC

EIRINI CHRYSOLORA, ROULA SALOUROU

TAGS: Finance

Even Public Power Corporation (PPC) looks set to be among the recipients of the so-called social dividend for 2017 – part of the amount above the primary budget surplus target that the government and the country’s creditors agreed last week could reach up to 1.1 billion euros.

The main destination of the government’s end-of-year handouts will be recipients of the Solidarity Social Income; there may also be some recipients among the pensioners who were wrongfully forced to pay excessive healthcare contributions in previous years. The chance that the last installment of the Single Property Tax (ENFIA) could be scrapped is out of the question, a senior government source assured.

Athens and the creditors have agreed that the primary surplus this year will reach up to 5 billion euros, against a target for 3.1 billion, meaning there will be an extra 1.9 billion – much more than the draft budget’s estimate of 800 million euros. The taxation overload and the likelihood that social security takings will be much higher than estimated will lead to a huge excess in the primary surplus.

The creditors have chosen to act more conservatively, telling the government to distribute 1.1 billion as a social dividend while holding on to the remaining 810 million as a cash cushion. After all, figures may well be revised, as was the case for 2016, when the primary surplus was found to be at 3.8 percent of gross domestic product, and not the original estimate of 4.2 percent.

Negotiations will go on, but it appears that besides the Social Solidarity Income recipients, part of the social dividend will also go to PPC to cover the cost of subsidized services – mainly the extra cost of supplying electricity to the islands. Unless the state foots that bill, PPC will have to raise its power rates.

The administration of the Single Social Security Entity (EFKA) is also ready to return an estimated 300 million euros to some 2.6 million pensioners who have overpaid for their healthcare, once a political decision is made to that effect. Provisional calculations say 1.9 million pensioners will receive 10 euros apiece, while some 93,000 will get about 1,000 euros each.

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