ECONOMY

Pension reform brewing again

The government yesterday reiterated that it plans no changes in retirement ages, social insurance contributions and the way pensions are calculated. A day after the unveiling of a comprehensive plan thrashed out by banks to solve the thorny problem of unifying their separate auxiliary pension funds, which has effectively opened the overall issue of pension reform again, Labor Minister Panos Panayiotopoulos told a press briefing that the problems of social insurance will be dealt with in the framework of existing legislation. The plan, authored by Piraeus Bank president Michalis Sallas, envisages the transfer of most of banks’ pension fund liabilities to the Social Security Foundation (IKA), with a 2-billion-euro start-up contribution by banks and an equal amount by the government over 30 years. Panayiotopoulos said the government is ready to mediate between banks and unions for a solution, but a prerequisite for that is a basis of consensus between the two sides. He said banks must meet their liabilities and that the government places the interests of IKA above all. «A solution will be found when banks decide to pay. In all cases we shall guard IKA’s financial health,» he said. Separately, Economy and Finance Minister Giorgos Alogoskoufis said that the cost of social insurance reform in banks and major public utilities will not burden the public purse beyond its due share. He also noted that the social insurance law passed by the previous PASOK government did not provide for adequate funding sources. Meanwhile, General Confederation of Greek Labor (GSEE) and the Civil Servants Union (ADEDY) warned of nationwide strike action if the Sallas plan or other proposals that preceded it are accepted. «The plan, if accepted, will transfer banks’ deficits to IKA, which will be burdened with many billions of euros. At the same time, it will lead to a downgrading of social insurance and pension rights of bank workers,» said GSEE president Christos Polyzogopoulos. He singled out the social insurance problem as the central current issue for the unions, adding that the Sallas plan and similar proposals amount to a circuitous attack on the existing system. He urged the government to assume responsibility for finding a solution to the problem and said GSEE and OTOE, the bank workers union, will only enter a dialogue on the subject on the basis of a framework which secures the existing rights of bank workers and as long as the financial cost of the reform is not transferred to IKA. ADEDY president Spyros Papaspyros described the recent proposals as a test of public opinion and union reaction. He warned that the unions will not accept solutions to the social insurance problem inspired by the «Thatcherite model.» He attacked senior PASOK members who have also called for social insurance reform again, saying their statements cause confusion and help neo-liberal policies.