A landmark agreement offering thousands of OTE Telecom employees an attractive early retirement deal, in return for putting an end to jobs for life for future company workers, will cost state coffers less than 300 million euros, the government said yesterday. Economy Minister Giorgos Alogoskoufis said the deal will cost a total of 1.5 billion euros, of which some 20 percent will be provided from public funds. Speaking to journalists after talks with Prime Minister Costas Karamanlis on the ruling conservatives’ program of structural reforms, Alogoskoufis said the state would contribute some 290 million euros by handing over a 4 percent share package in the former state giant to the OTE employees’ fund. He said OTE would raise the remaining 1.2 billion euros through cost-cutting as a result of the retirement deal, which could affect up to 6,000 employees. «The consensual deal will not put a burden on the state budget, and, by extension, on Greek taxpayers,» a government source said, speaking on condition of anonymity. Alogoskoufis’s comments followed the strong objections to the deal voiced on Sunday by Socialist opposition leader George Papandreou, who accused the government of trying to saddle low-income earners and pensioners with the bill for the OTE agreement. Government spokesman Theodoros Roussopoulos said the ruling conservatives had inherited OTE’s problems from the Socialist PASOK government it replaced in March 2004. «We found ourselves before a dilemma,» he said. «We either had to postpone addressing the problem for an indefinite period, or solve it immediately while showing respect for the people who had worked at OTE for decades. We chose the latter approach, as it will discourage the creation of new categories of unfairly privileged workers and at the same time helps overcome the problems – to the benefit of the workers, OTE and the Greek economy.» Meanwhile, government sources said Athens will discuss the matter with European Commission officials before passing legislation to uphold the deal, to ensure Brussels raises no objections on grounds of EU competition regulations.