ECONOMY

Employers appear happy over priorities

Prime Minister Costas Simitis met yesterday, on separate occasions, with employers and unionists to discuss his economic policy priorities. From the two meetings, it appeared that Simitis, while avoiding confrontation with the unionists, is closer to the employers’ views. Simitis first met with representatives from the General Confederation of Greek Labor (GSEE). Labor Minister Tassos Yiannitsis attended the meeting. The unions, controlled by members of the ruling Socialist party, have been at loggerheads with Yiannitsis ever since last March when he unveiled a blueprint for social security reform. Yiannitsis was in favor of raising the retirement age and cutting benefits so as to force employees to turn to privately-managed pension funds. An outcry by the unions led Yiannitsis, and Simitis, to shelve the project and led to calls within the Socialist party for more social spending. While Simitis has repeatedly said that economic development and social cohesion go together, he is determined to stick to his core policies. In their meeting with Simitis, the unionists demanded a change in economic policy, higher benefits for the unemployed and a redistribution of income in favor of lower-income groups. GSEE president Christos Polyzogopoulos summed up their demands as A social policy that will function in favor of the weaker five (social) groups. Simitis made a conscious effort not to contradict the unionists, but, nonetheless, challenged some of their assumptions. He rejected the unionists’ argument that the gulf between rich and poor is increasing, saying data supplied by the Organization for Economic Cooperation and Development was erroneous. He countered that Greece’s social spending is higher than in all other Southern European countries, referred to income redistribution policies such as subsidies to farmers and for heating fuel, and argued that people were getting wealthier, pointing to the high percentage of homeowners. Simitis agreed with GSEE that there is a lot to be done in favor of lower-income groups, but added that he preferred policies targeted toward specific groups rather than more widely distributed handouts. As for the proposal, floated by GSEE and some Socialist deputies, for a guaranteed minimum income, he replied that, We are not yet ready to introduce it. Simitis did not reply to GSEE’s demand for higher unemployment benefits. Following the meeting, Polyzogopoulos said that the Prime Minister appeared ready to increase social spending. We will consider our response after we hear the official announcements, Polyzogopoulos added. Other GSEE executive members, belonging to other parties, were more critical of the government, agreeing that they expected little and that they doubted Simitis’s commitment to higher social spending. The meeting with the Federation of Greek Industries (SEV) that followed was not confrontational. Members of the SEV executive board agreed with Simitis that economic development and policies in favor of people with lower incomes go hand in hand. Simitis also talked about the State’s support for enterprises and added that unemployment will fall as growth reaches higher levels. He predicted that the economy will grow 4.6 percent this year and that growth will reach 5 percent by 2004. Our goals coincide, said SEV president Lefteris Antonakopoulos following the meeting.