The government is bracing for a difficult week as the leaders of the troika mission to Greece are back for fresh talks that are expected to focus on the streamlining of the civil service – and the possibility of layoffs – as well as tax collection, both areas where Greek authorities have failed to meet targets set by international creditors.
Finance Minister Yannis Stournaras was to meet with envoys from the European Commission, European Central Bank and International Monetary Fund in Athens on Sunday before joining his eurozone counterparts in Brussels on Monday for a summit that will touch on Greece but will focus chiefly on Italy – where inconclusive elections have fueled political instability that has spooked global markets – and Cyprus, which is likely to appeal for foreign rescue aid later this month.
Originally eurozone officials were expected to decide this month on whether to approve the release of the next 2.8-billion-euro tranche of rescue funding for Greece but this decision is likely to be put back because of anticipated delays in the government and the troika reaching consensus on civil service streamlining. Troika chiefs are expected to discuss the matter with Administrative Reform Minister Antonis Manitakis on Monday. The fact that Fotis Kouvelis, the head of junior coalition partner Democratic Left, has vehemently opposed any layoffs in the state sector, is believed to be a concern. There are fears that PASOK might strike a similar stance, under pressure from the party’s more left-leaning MPs. The official line of the conservative-led government, however, is expected to be an insistence that layoffs be limited in the first instance to public servants who have violated the code of conduct.
The troika is keen for the government to press ahead with a plan to put 25,000 civil servants into a mobility scheme that would see most of them dismissed and a few transferred to understaffed sections of the public sector. But there have been delays in getting the scheme off the ground. Plans for the reorganization of staffing at ministries, due for completion last month, are not yet finalized.
Prime Minister Antonis Samaras is expected to meet with troika chiefs later this week, after a visit to Turkey, and is likely to advise against additional austerity measures in order to maintain “social calm” so that the country’s economic reform program can start bearing fruit.