NEWS

Katrougalos opens door to pension reductions

katrougalos-opens-door-to-pension-reductions

Labor Minister Giorgos Katrougalos admitted Thursday that the government may have to make deeper cuts to pensions than it had wanted.

Katrougalos met with the representatives of Greece’s lenders on Wednesday and, according to sources, was told that they would not accept a 1.5 percentage point increase in social security contributions to produce the fiscal results needed to help make the pension system sustainable.

This means that the Labor Ministry is now set to adopt an alternative plan that will see significant cuts to auxiliary pensions. Speaking to Sto Kokkino FM Thursday, Katrougalos suggested that anyone earning more than 1,300 euros per month in total from their main and supplementary pensions would face a reduction.

“There will be no cuts to main and auxiliary pensions that add up to less than 1,300 euros,” he said. “We guarantee that, no matter what.”

Sources told Kathimerini that the ministry’s plan could see supplementary retirement pay being slashed by as much as 20 percent. There is also a possibility that this could affect auxiliary payments below 170 euros a month.

The institutions have also asked the government to adopt a mechanism that will lead to immediate cuts to pensions if the social security funds post a deficit.