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After troika deal, Greek coalition aims to secure next bailout tranche on April 1

After reaching an agreement with the troika on Tuesday, the Greek government now has to prepare legislation for the reforms it agreed with its lenders in the hope that the disbursement of at least 10 billion euros in loans will be approved at an informal Eurogroup meeting due to take place in Athens on April 1.

Athens and the troika did not comment publicly on the details of the deal, clinched around lunchtime, apart from Prime Minister Antonis Samaras confirming that social security contributions would be reduced by 3.9 percentage points.

Samaras is due to meet Deputy Premier Evangelos Venizelos at the Maximos Mansion on Wednesday to discuss the coalition’s next steps. Government sources said that the two leaders must decide whether the reforms Athens agreed to will be legislated in one multi-bill or if several draft laws will be submitted to Parliament. The coalition aims to pass the measures before the end of the month so eurozone finance ministers can approve the release of the next tranche on April 1. It is not clear how much will be disbursed, though. Greece has a maximum of 11 billion euros to receive from the eurozone and 3.6 billion from the International Monetary Fund.

Kathimerini understands that Greece agreed to adopt 75 percent of the 329 liberalization measures recommended by the Organization for Economic Cooperation and Development (OECD). Another 15 percent will be adapted to the specifics of the Greek market, while the remaining 10 percent have been put off for now.

Greek officials agreed with the troika to lower fines for the late payment of taxes and to disconnect the public sector mobility scheme from the need for sackings. Administrative Reform Ministry sources said that firings of civil servants would continue in 2015, even after Greece meets it target of 15,000 by the end of this year. However, they added that this would not be part of a pledge to the country’s lenders. They would, instead, be the result of disciplinary measures or the merging and closing down of public bodies.

Another sticking point had been the troika’s insistence that Greece change its rules on mass dismissals, which need the labor minister’s approval. Sources said the two parties agreed that the matter should be referred to the International Labor Office, which will be asked to arbitrate on the issue. The two sides also agreed that automatic three-year pay rises for new hires should be reduced by 50 percent from 2017.

Heralding the deal with the troika during a televised news conference, Samaras repeated his pledge to give a portion of a projected primary surplus to Greeks on low incomes. “More than 500 million euros will be given immediately to 1 million Greeks,” he said, noting that members of the police and security services on monthly salaries below 1,500 euros would benefit.

Another 20 million euros would go toward the growing ranks of the country’s homeless, Samaras said, adding that the state would pay an additional 1 billion euros in debts to suppliers than it had originally budgeted for this year while a further 1 billion euros would go toward reducing the country’s debt.

Greece has calculated its primary surplus for this year at 2.9 billion euros but its size is to be confirmed by the European Union’s statistics service Eurostat in April. After that, Greece will be able to distribute the promised handouts. The beneficiaries include more than 400,000 families on low incomes and some 300,000 pensioners, Kathimerini understands.

Another 350 million euros from the surplus is to go toward plugging a gap in the country’s social security funds.

SYRIZA slammed Tuesday’s agreement with the troika and accused the government of caving in to the lenders’ demands, which would lead to further job losses and wage cuts. “The only truth Mr Samaras told today is that the government kept to its pledges,” said SYRIZA leader Alexis Tsipras. “It kept to them fully and unilaterally – only toward the troika, not the Greek people.”

Tsipras said the deal meant that the prime minister would forever be associated with the EU-IMF memorandum. “Mr Samaras is the memorandum,” he added.

ekathimerini.com , Tuesday March 18, 2014 (21:19)  
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