NEWS

2007 budget on table

The Finance Minister submitted to Parliament yesterday a draft bill for the 2007 budget in what could be the ruling New Democracy government’s final budget before the next national elections. Prime Minister Costas Karamanlis described the budget as being «credible and responsible,» considering it is expected to help remove Greece’s economy from European Union scrutiny. The Commission launched its «excessive deficit procedure» against Greece in 2005 after the EU discovered Greece’s budget deficit was above the 3 percent limit set for countries in the eurozone. Greece has surpassed that limit since it entered the single currency zone in 2001. «The 2007 budget is a guarantee for new important results regarding growth, the strengthening of the economy, and securing social cohesion,» Karamanlis told an Inner Cabinet meeting. The deficit is expected to narrow from this year’s targeted 2.6 percent of GDP to 2.4 percent. Economic growth in 2007 is forecast to remain among the strongest in the eurozone at an annual rate of 3.8 percent for the year. Speculation has been growing recently that the government will hold elections before its four-year term expires in March 2008. Officially, though, the government insists it will finish its term. «We are not entitled to harm the important steps made by the economy in order to gain a temporary boost (from voters),» Karamanlis said. Lawmakers will begin discussing the budget on December 18, with a final vote expected on December 22. Meanwhile, the Labor Ministry also presented to Parliament yesterday an amendment regarding the introduction of favorable payment terms for outstanding debts owed to Greece’s largest pension fund, IKA. In a last-minute change, Labor Minister Savvas Tsitouridis cut favorable terms offered to big business by the draft bill and implemented a one-rule-for-all policy. «The regulation helps the market breathe, helps funds and the government maintain jobs,» said Tsitouridis. Businesses with debts to IKA will be able to pay money in installments over a 96-month period and will also qualify for a discount of up to 50 percent on penalties imposed, according to the bill.