Overdue payments land Greece in the dock
EC refers Athens to European court over arrears of €2.373 bln, of which €1.362 bln concern hospitals
The European Commission has referred the Greek state to the European Court because of its long-standing practice of paying off its commitments to its citizens and suppliers whenever it wishes. The cause is a long-term delay in paying the hospitals’ commitments, which total 1.3 billion euros.
The state’s arrears, according to data from the Ministry of National Economy and Finance, climbed to €2.373 billion in February, of which €1.362 billion relate to hospital liabilities. Two months ago, in December 2023, hospital debts were €1.319 billion, while in December 2022 they were €907 million.
The hospitals are reopening the wound of overdue public debt that has been festering since the bailout years of the previous decade, due to the then overdue pensions.
The pensions issue was resolved, but the hospitals issue was exacerbated.
The creation of the National Central Health Procurement Authority (EKAPY), upon which the government pinned its hopes, does not seem to have helped address the problem so far.
The Economy and Finance Ministry, however, claims that after the Health Ministry’s amendment is passed, which will see EKAPY take over all procurement, the problem will disappear. At the moment, the blame is attributed to delays on the part of the hospitals’ accounting departments and certainly not to a lack of liquidity.
The referral by the European Commission concerns the failure of hospitals to comply with their obligation to pay their debts immediately when suppliers agree to waive their interest rights.
It was preceded in November by a referral on the general delay in payments. Directive 2011/7/EU on late payments obliges competent authorities to pay their invoices within 30 days (or 60 days if they are health authorities).
In practice, payment delays are much longer.
“We estimate close to 10-11 months from the moment we issue an invoice,” medical devices market executives told Kathimerini.
Total hospital arrears from December 2018 to December 2023 increased by 349%.
At the same time, the Association of Health Research and Biotechnology Industry (SEIV) has cited a “hidden debt” of unpriced items delivered to hospitals under the emergency procedure (mainly for emergency surgeries) without the corresponding credit being secured, with the result that companies have to wait a long time for orders to be issued for those used materials.
