The troika has not asked Greece to lift the moratorium on home foreclosures but to prevent people “systematically abusing” the protection it offers, Simon O’Connor, the spokesman for European Economic and Monetary Affairs spokesman Olli Rehn said on Monday.
He also suggested that it was up to the Greek state to provide protection for those who might lose their homes as a result of repossessions.
O’Connor responded to journalists’ questions in Brussels by saying that the current ban on banks repossessing homes with a value of less than 200,000 euros if customers have stopped paying their mortgages also protected those who had the ability to pay but just stopped doing so.
“We want a solution that will protect the truly vulnerable but will also allow banks to put things order,” said O’Connor. “The general moratorium on foreclosures allows for systematic abuse from people who are trying to get away without paying.”
The foreclosures issue has been one of the main obstacles to Greece and the troika reaching an agreement that would help conclude the latest review of the Greek adjustment program and clinch the release of the next tranche of 1 billion euros.
The government is reluctant to lift the ban, fearing a backlash from its own MPs as well as opposition parties. Deputy Prime Minister Evangelos Venizelos had the chance to convey this concerns, as well as other, when he spoke on the phone with Rehn and German Finance Minister Wolfgang Schaeuble on Monday.
Reports in the Greek media over the weekend suggested that International Monetary Fund representative Poul Thomsen had warned the Greek government to prepare accommodation for people who lose their homes rather trying to resist efforts to remove, or change the terms of, the foreclosure ban.
These reports were not confirmed or denied by the troika but O’Connor said that the Greek banking system was not in a position to allow some homeowners to continue avoiding mortgage repayments.
“The protection of the socially vulnerable is the role of the state, not the banking system,” he said in Brussels.
However, Hannes Swoboda, the leader of the center-left alliance in the European Parliament, the Progressive Alliance of Socialists and Democrats, voiced his disapproval of the demands being made by the troika.
“The troika should stop to ask for further antisocial measures in Greece and should respect the enormous reform work done,” he wrote on his personal Twitter account.