Government officials indicated on Monday that the thorny issue of pension reform, one of Greece’s key “red lines” in negotiations with creditors, would be put off until the fall after a series of statements by prominent SYRIZA officials suggested the government had backed down on pre-election pledges to protect pensions.
Alternate Social Security Minister Dimitris Stratoulis said on Monday that a so-called zero deficit clause – according to which the state would no longer be permitted to subsidize pension funds’ shortfalls – would be indefinitely suspended. His comments followed remarks by Giorgos Romanias, a ministry general secretary, according to which the enforcement of the clause would be postponed.
Prominent SYRIZA MP Alexis Mitropoulos struck a tone of harsh realism, noting that irrespective of whether the clause is postponed or abolished – as the leftist party had originally pledged – further cuts to pensions were inevitable.
Mitropoulos’s comments in turn prompted a statement from Labor Minister Panos Skourletis who said a broader debate on the Greek pension system, aimed at “radical reform,” would begin in the fall.
Stratoulis also said that talks on pension reform would begin in the fall, specifically in September, noting that all related parties would be involved in a “broad national dialogue.” He added that, by then, a proposal being prepared on behalf of the government by labor expert Savvas Robolis, foreseeing ways of covering deficits at pension funds, would be ready.
Skourletis expressed his confidence that a deal with Greece’s creditors would be reached “with decent terms” and said he believed the final agreement would feature the government’s proposals on labor reforms. These include the reinstatement of collective work contracts and the restoration of the minimum wage to 751 euros.