ECONOMY

Search for new measures begins

The new government to emerge from the general elections due in the next five to six weeks will need to find some 11.6 billion euros for the next two years through new measures in June. For this reason, the interim government and the country?s official creditors are currently examining how this can be done.

The technical teams of the International Monetary Fund and the European Commission?s Task Force for Greece began on Monday the assessment of public expenditure in cooperation with officials from the General Accounting Office of the State.

They have enlisted the help of the Center of Planning and Economic Research (KEPE), an economic survey institute under the supervision of the Development Ministry. KEPE has conducted a survey regarding state spending and appears to have already found significant salary differences among ministries, even now that the so-called unified pay structure applies in the public sector.

The recording of spending per ministry must be completed by the end of the week, while KEPE will deliver its own report to the Finance Ministry by the start of next week. The aim is for the government and its creditors to have drafted a provisional plan on how to contain spending by early May, ahead of the next inspection by the troika in mid-May.

The next government will therefore have a set of proposals to choose from, hence the ideas on the table will concern measures of much more than the 11.6 billion euros required for 2013 and 2014. A considerable part of that is expected to come from cuts to pensions and social benefits (between 4 and 8 billion euros), with the rest coming from reducing spending in the public sector through layoffs, salary cuts and the closure of state bodies.

?The measures we are adopting now will start to pay off? in seven to eight months, Gikas Hardouvelis, economic adviser to Prime Minister Lucas Papademos, told financial website Capital.gr in an interview yesterday. ?Otherwise, we might go back to where we started, to a revival of fears over Greece,? he said.