Take two on pensions

In an about-turn from its position less than two weeks ago, the government yesterday unveiled plans for reforms to the bank workers’ pension scheme that will not involve any contributions from the state, while unionists said they would persist with strike action as a show of opposition to the deal. The government is attempting its first major effort to reform Greece’s labyrinthine social security system by tackling banking pensions but has found itself colliding head on with unionists. However, yesterday’s proposals appeared to have more to do with possible opposition to its reforms from the EU. On June 3, Economy and Finance Minister Giorgos Alogoskoufis proposed the creation of a single auxiliary pension fund for bank employees. He proposed that two thirds of the fund’s cost would be covered by the banks and the rest by the state. But yesterday he said the supplementary fund would be covered by banks wishing to take part in the scheme. His change of heart was largely prompted by concerns from Brussels that by supporting the fund financially, the Greek state could have run afoul of EU laws, particularly in the area of competition. The state will, however, have control of the fund and, according to Alogoskoufis’s proposals, all bank employees will be registered with the main social security fund, IKA, by 2007 for their main pension benefits. Employees and banks have been locked in talks over pensions for the last six months. The issue has gained added urgency because of a requirement under International Financial Reporting Standards that all listed companies, including banks, should include such liabilities on their balance sheets by the end of June. The Federation of Bank Employees (OTOE), with which the finance minister has been at odds over the past two weeks, was distinctly unimpressed by what Alogoskoufis had to say. Unionists, fearing their pensions will shrivel, called a continuation to their strike action, which began a week ago, with another 48-hour strike. OTOE bosses could decide tomorrow whether to extend their strike to include Friday and Tuesday (Monday is a public holiday). The country’s two largest unions – the umbrella GSEE for the private sector and ADEDY for public employees – will stage three-hour work stoppages from noon on Thursday in support of bank employees.

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