ECONOMY

Focus on public firms, revenues

Athens is desperate to show its international creditors, whose representatives arrive in Greece on Thursday, that it is complying with their requirements as far as labor relations, budget revenues and the streamlining of public companies are concerned.

The quarterly monitoring of Greece?s fiscal efforts will determine whether the fourth installment of loans from the European Union, the European Central Bank and the International Monetary Fund, set for March and amounting to 15 billion euros, will be disbursed.

The initial checks will be carried out by technical representatives of Greece?s creditors, with high-level officials set to follow later.

One of their main aims is to establish the extent to which the law on industrial relations is being implemented in practice. They intend to find out if in-house labor contracts do indeed now supercede sectoral labor agreements, otherwise they are bound to seek further action.

The creditors, also known as the troika, have also expressed concern regarding the general government deficit (including the finances of local authorities, public companies etc that were recently included in the fundamentals of the state budget). The final data for 2010 is still pending so there may be some fine-tuning to the targets currently set for the 2011 budget.

Other areas of inspection will include the law liberalizing so-called closed professions and changes to public companies as far as state spending is concerned. The government has committed itself to saving 800 million euros, but has only secured 400 million through salary cuts. The rest will come via public transport fare increases and consumer spending cuts.

Another worry for the troika is state revenues. To this end, Finance Minister Giorgos Papaconstantinou is to present on Tuesday to the Cabinet the new tax bill that will be tabled in Parliament in two weeks? time.

The draft contains provisions for even tougher sanctions for tax evaders and the strengthening of the inspection mechanism, meant to appease Greece?s creditors.

The measures to be announced reportedly include reclassifying tax evasion for amounts of 75,000 euros and over from a misdemeanor to a felony, as well as heavy penalties for corrupt tax officials and inspectors.