NEWS

PM avoids giving details of new measures

Prime Minister George Papandreou on Friday avoided elaborating on the government?s midterm fiscal plan for the 2012-2015 period, which is designed to save Greece 23 billion euros, saying that details of the new reforms and a time frame for their implementation would be revealed after Easter, which falls on April 24.

Addressing his ministers in a cabinet session that was broadcast live on state television and on the Internet, Papandreou took stock of what his administration has achieved over the past difficult year and stressed that he would push ahead with painful reforms ?regardless of the cost.?

?We achieved the greatest deficit reduction ever in this country or any other European Union state,? Papandreou remarked. He said his government aimed to cut state spending to 44 percent of gross domestic product by 2015 but he did not specify how this would be achieved.

In a clear dig at the failures of the opposition conservatives who were previously in power, Papandreou declared: ?We respond to those who led Greece to the brink of disaster with a fight-dodging and ‘leave it for later’ attitude with decisions and change.?

The PM pledged to transform the country from ?a Greece of crisis to a Greece of productivity? and stressed that the key issue was not restructuring the country?s debt but restructuring the country itself, a reference to the slew of reforms undertaken and those that are still in the pipeline.

The premier?s comments came amid growing internal strife within the ranks of the ruling Socialists, with several MPs said to be questioning the direction of the government?s economic policy and particularly its impact on lower income groups.

Some commentators believe that the much-awaited announcement on Friday of the contents of the midterm plan was postponed to allow Papandreou time to win round skeptical MPs and avoid a defeat in Parliament where the new measures are to be submitted in mid-May.

The reforms are believed to comprise severe cuts to spending in the state sector and the launch of a privatization program. According to sources, the aim is to cut another 4.6 billion euros from public sector salaries, another 3.5 billion euros from lossmaking state companies and the debt-ridden health sector. There are also plans for cuts in defense spending and cutbacks on social benefits and tax exemptions.

The privatization program is expected to begin with the sale of an additional stake in OTE telecom to Deutsche Telekom, the selloff of at least 10 percent of the Public Power Corporation with state sewage and water companies, port authorities and regional airports next in line.