Troika agreement eludes government

The meeting between troika representatives and Prime Minister Antonis Samaras which was due to take place this week has been postponed until next week as a number of issues remain unresolved between the Greek government and its lenders.

Finance Minister Yannis Stournaras said on Wednesday that there was a “long road ahead” in the talks between the two sides, which are taking place as part of the latest review of the Greek fiscal adjustment program. A positive review will help unlock the final sub-tranche of loan funding that Greece is due to receive in the first quarter of this year, worth 2.8 billion euros.

Among the issues that have yet to be settled are the reduction of civil servant numbers via a mobility scheme or through direct dismissals, a payment plan for companies and individuals that owe social security contributions and a program giving bank customers longer to repay their loans.

The coalition government had been hoping the troika would accept a 60-installment payment plan for social security fund debtors but representatives of the European Commission, the European Central Bank and the International Monetary Fund have not consented.

Athens is also proposing that for the next four years some low-income households, pensioners, the unemployed, large families and disabled people be allowed to only repay the interest on their loans, which will be set at a fixed rate of 1.5 percent. The length of the moratorium and the interest rate are both thought to trouble the troika, which prefers a two-year period of interest-only repayments.

A plan to streamline government ministries, which is close to completion, will result in around 2,000 employees being put into the mobility scheme in due course. The aim is for a total of 25,000 civil servants to enter the scheme up until the end of the year. On Wednesday, authorities approved new staffing plans for six ministries which will lead to 900 employees entering the mobility scheme, cutting state expenditure by 19.8 million euros. An overhaul of the other six ministries will result in savings of around 28 million euros.

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