ECONOMY

Gov’t and unions lob the ball around on bank pension issue

The major issue of the integration of banks’ main and auxiliary pension funds appeared no closer to a solution after a meeting between Economy and Finance Minister Giorgos Alogoskoufis and the Federation of Bank Employees’ Unions (OTOE) yesterday. Alogoskoufis said the government wants neither to raise the issue of broader social insurance reform nor intervene in the integration of the various bank workers’ pension funds, and urged the two sides to reach a comprehensive solution through dialogue. He said «the government will speak last» and would contribute to the cost of a scheme for reasons of public interest. For its part, OTOE said a comprehensive solution should include the integration of the main pension funds into the Social Security Foundation (IKA) and the creation of a single auxiliary pension fund for the sector. It added that it was awaiting an official and unified proposal by banks for substantial dialogue to begin. Last week, OTOE said an unofficial plan aired by Piraeus Bank President Michalis Sallas, which envisages about equal bank and government contributions of 2 billion euros to a unified auxiliary pension fund, was the first step toward a solution but that adequate funding should be found for the transfer of the 18,000 bank workers’ main pensions to IKA. Labor Minister Panos Panayiotopoulos had thrown the ball back into the banks’ court, saying a solution would be found if banks decided to pay for the cost, and that the government will in all cases guard IKA’s financial health. The issue has been launched into the forefront because banks’ actuarial pension liabilities – which, according to International Accounting Standards that are due to go into effect as of 2005, will have to be deducted from their equity capital – are so high that a number of them, notably Emporiki, will be in a serious danger of collapse. On Monday, Takis Arapoglou, president of the National Bank, the country’s biggest, proposed to OTOE that the integration of auxiliary pension funds be preceded by solutions for the actuarial liabilities of each individual bank fund. Other bankers are reportedly expressing optimism that the Sallas plan can serve as a basis for discussion. Separately, the General Confederation of Greek Labor (GSEE) general council said any plan for unifying the pension funds should not burden IKA and urged the government to commit itself to maintaining the existing social insurance regime. It warned of nationwide mobilizations in the opposite case. «A solution should be in line with the decisions of OTOE. The proposals aired so far are rejected because they do not tackle the problem and pose an excessive financial burden on IKA,» GSEE said. Further meetings on the issue, involving OTOE, banks and Alogoskoufis will follow next week. GSEE is planning a three-day mobilization, culminating in a rally in Athens on December 15 in support of measures against unemployment and price rises, and of income subsidies to the lowest paid and the existing social insurance system. OTOE will also stage a two-hour work stoppage on the above date.