More subsidies on the way

More subsidies on the way

Now that it has got some relief from the European Union, in the form of long-term, low-interest loans from the SURE program, the government is considering extending aid to employees, the self-employed and businesses hit by the coronavirus pandemic.

The Finance and Labor ministries are jointly preparing an aid package for the fall. It contains the extension of employee contract suspensions for October and November to sectors especially affected by the pandemic. Those would include, among others, bars, cafés and restaurants, sports clubs, gyms, cultural activity organizers and hotels.

The ministries are also considering extending wage and social security contribution subsidies for employees forced to work part-time until the end of the year. And, given that Greece got more money from the EU than it expected, the government is mulling the provision of even more generous benefits, since their fiscal effect – that is, on the budget deficit – is not as big as feared. This will happen after the current subsidy program expires, on October 15.

In the same vein, the government is prepared to extend unemployment benefits to both short- and long-term unemployed to August and September.

Labor and Social Security Minister Yiannis Vroutsis has said that, since March, the government has spent almost €1.57 billion on special purpose compensation and social security contribution subsidies. The EU aid package of €2.73 billion is, therefore, enough to cover to-date costs and help extend such measures for a few months.

The EU money making such an extension possible will start arriving in September and will be made available in installments.

Employers’ organizations are constantly demanding a higher subsidization of their contributions to social security and pension funds, even raising it to cover 100% of their contributions, and the government appears receptive to that. Employees are likely to get the same treatment, as well as seasonal employees.

​​​​​​Tourism professionals, who saw their sector lose over 80% of last year’s income, want more. The federation of tourism professionals (SETE) wants job subsidization to continue until the end of March 2021 – that is, almost to the beginning of the next tourist season.

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