Pension reform report sparks initial reactions
A report on reforming Greece’s pension system, expected to be submitted by a committee of experts this week, contains recommendations that run counter to the government’s pledges it will not raise retirement ages or reduce pensions, sources said. The committee, headed by the president of the consultative Economic and Social Committee (OKE), Nikos Analytis, is proposing restrictions to discourage early retirement, the merging of social insurance funds, incentives for staying at work beyond the age of 65, and the linking of pension levels with those of social security contributions. In some cases, such as mothers with underage children, the committee is proposing the raising of the retirement age by up to 17 years, and reductions in pensions of up to 8-10 percent. Analytis said in a radio interview that the biggest changes will affect those working people now nearing the age of 35, who have not had to plan their pension future yet. The linking of contributions to pensions is expected to bring about sizable reductions in pensions. Sources said the committee has studied two scenarios, either changing the way pensions are calculated on the basis of years at work rather than the highest paid five years, or gradually lowering to 70 percent the ratio of pension to salary income as of January 1, 2008, for public servants and employees of utilities and banks. In both cases, the reduction is estimated at 8-10 percent. Analytis said that the social insurance issue is a complex problem, requiring the adoption of many measures which can be implemented either gradually or simultaneously. Which of these proposals the government will opt for and the timetable for their implementation will determine the magnitude of the actual changes. Responding to Analytis’s comments, the Civil Servants’ Union (ADEDY) said it appears that the proposals are paving the way for a policy of abolition of established pension rights. «The target of the neo-liberal assault is obvious: the freeing of public and social resources in favor of the market, private interests and profits. The unions will respond in a united, direct and dynamic fashion, will not accept any dialogue and will contest the reinstatement of rights already abolished and the necessary public financing of social insurance.»
