New reforms on the way

MPs vote on labor bill tomorrow but further changes already on drawing board

Tomorrow’s vote in Parliament on the labor reform bill will mark the last round in the government’s current series of structural reforms, but the ruling conservatives have, according to sources, already started planning the changes they want to introduce next year.

Among these proposed changes are more reforms of public companies and an overhaul of the education system.

The government considers the current setup at public companies, ranging from utilities such as the Public Power Corporation (PPC) to the Greek National Tourism Organization (GNTO), to be a chink in the economy’s armor that needs to be plugged quickly. The companies in question employ some 80,000 staff and account for some 7 percent of Gross Domestic Product (GDP), according to the Economy and Finance Ministry. Therefore, a 15 percent increase in their productivity rates would lead to a rise of 1 percent in the country’s growth rate, the government believes.

The ministry is currently working on a draft law to reform the way public companies work, which it intends to have ready by the end of September. The main thrust of the bill is likely to be the creation of a special committee to coordinate among the various ministries which currently have jurisdiction over the firms.

Economy and Finance Minister Giorgos Alogoskoufis has already intimated that the government is considering ending the policy of lifetime tenure at public utilities. The administration of Prime Minister Costas Karamanlis has also been buoyed by the relatively smooth manner in which it introduced an early retirement scheme at OTE telecom in May, which also put an end to permanent jobs at the company.

The reforms planned for the education system remain unclear but sources indicate that Karamanlis is personally keen to see the standard of teaching and learning raised so Greece can reap the long-term benefits. He is set to unveil the reforms at the Thessaloniki International Fair in early September.