Unified salary structure for public sector not ready yet

After 18 months of delays in coming up with an across-the-board salary structure for the public sector, aimed at cutting the cost of wages and meeting one of the terms of the recently approved midterm fiscal plan, the government asked its international creditors for an extension until this fall to draw up the final draft of a streamlined salary system.

Finance Minister Evangelos Venizelos and Interior Minister Dimitris Reppas, both recent appointments to the Cabinet, held their first meeting on Monday to discuss the issue, and, according to sources, agreed that they first needed to quantify the changes that would be imposed on the salary structure and then assess the effects of these changes on civil service pensions before they are able to draw up a draft law and present it to Parliament.

According to the agreement signed by Athens and its lenders, the new salary structure proposal needs to be submitted before the end of July and be passed no later than mid-August. The government, however, is expected to ask for an extension by the end of July, arguing that it has insufficient data on which to draw up a comprehensive proposal. Meanwhile, of the approximately 750,000 public sector employees, just 370,000 are currently paid via the centralized payroll, making the task of collecting data from all the other payroll services that much harder.

The new salary structure is estimated to save the state approximately 1.5 billion euros by 2014 and a total of about 2.2 billion euros by 2015, when the memorandum expires.

The structure will also include employees at state-owned companies, while civil servants that are on a special pay scale will not see their additional wages abolished, but instead will be incorporated within the unified structure. Long-serving civil servants will be eased into the new salary system over a period of three years, while the regime will affect all new hires, who will no longer be considered to belong to the specific service that hired them but will be moved around depending on where they are needed most.

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