NEWS

A very long-term reform

Prime Minister Costas Karamanlis is laying the groundwork for the government to launch talks on social security reforms which are expected to be introduced over a 15-year period, senior government officials told Kathimerini. Karamanlis has given instructions to Finance Minister Giorgos Alogoskoufis and Employment Minister Savvas Tsitouridis to put together a committee that will oversee the changes as well as to commission a report providing a precise picture of the system’s financial health. As the conservative government approaches two years in office, the prime minister has said that whatever changes are to be made will be implemented by the next government. The creaking social security system is seen as one of the economy’s most pressing issues and a problem that experts say will only grow in future if not addressed. Some estimates place the total social security deficit at a massive 400 billion euros – more than twice the country’s annual economic output. The possible changes will only affect new entrants into the social security system, Alogoskoufis told Kathimerini. The finance minister also said that current pensioners, or people nearing retirement, will not see their rights affected. Greece has been repeatedly called on to address the sensitive issue of pension changes by international organizations, such as the International Monetary Fund (IMF), but has stopped short of making the much needed reforms. However, indications that about 85 percent of Greeks believe that problems in the social security system need to be addressed has helped the government to place it higher on the reforms agenda. Concerns have arisen about the future of the social security system given the aging population. In a country with a population of about 11 million people, there are more than 3.5 million pensioners – a figure that is forecast to rise in coming years as the population ages.