Pension talks begin in fog of good will

Ministry presents outline of plan

The dialogue on social security reform began yesterday with the government presenting labor and employers' federations with a set of principles and guidelines, but not explaining key points as to how the system will meet the stated objective of functioning autonomously and not running out of money.

The leader of the General Confederation of Greek Labor (GSEE), Christos Polyzogopoulos, said, after a meeting with Labor Minister Dimitris Reppas: «This was a valuable meeting because an effort was made by the ministry to set out and present the framework of serious issues, principles and proposals.» But noting the lack of specifics, he added, «Many issues remain open. I don't believe that anyone expected we would find solutions today to all the issues that constitute the problem of social security. There are big and great issues that remain open.»

Polyzogopoulos represents the mainstream in the ruling PASOK party's labor movement. Other parties and other PASOK factions expressed reservations over what remained unsaid.

Federation of Greek Industrialists' (SEV) President Lefteris Antonakopoulos was upbeat, saying, «We are off to a good start and with the apparent positive attitude of all, we can reach a good result.»

Reppas noted that the government and labor had been involved in a discussion in the past months, following the government's withdrawal of proposals a year ago that were condemned by labor as demanding more work for less benefits. «Social convergence and economic progress, the fight against unemployment and the raising of national income have to be related and balanced,» he said.

The government's proposals are based on the two pillars of a main pension and an auxiliary pension. It rules out a third pillar of private insurance funds. The proposed transition period will be to the end of 2007. Farmers, military personnel, police, self-employed professionals and news media personnel will be exempted.

The government promises to increase contributions toward employees social security payments (which are in addition to employers' and employees' contributions). It does not say how it plans to do so, when, nor how much it will contribute. It proposes a single retirement age of 65 for both sexes with exceptions, such as mothers of underage children.