NEWS

PM to unveil pension reforms

Prime Minister Costas Karamanlis is poised today to unveil in Parliament his government’s plans to overhaul Greece’s tottering pension system in what New Democracy officials described yesterday as «the mother of all reforms.» Karamanlis met with Employment and Social Security Minister Fani Palli-Petralia yesterday to go over the final details of the package of reforms prepared by the conservatives. The premier has decided to unveil the measures himself as he wants to emphasize that the whole government is united behind the proposed changes, some of which are likely to be widely unpopular. Karamanlis is not expected to present the exact details of the reforms but rather their general direction as the government wants to retain some flexibility for the debate that will be held in Parliament after the bill is tabled. However, Kathimerini understands that Karamanlis will insist on at least three main proposals. Firstly, severe restrictions will be placed on early retirement schemes to make them less attractive options. Secondly, the conservatives intend to go ahead with plans to unify more than 150 pension funds into less than 10. There has been considerable opposition to the move from some of the better-managed funds. As a result, the funds for people who work in the media are likely to be unified but will not be merged with other funds. The engineers’ pension fund, however, is likely to be merged with the lawyers’ and doctors’ funds. Karamanlis is also set to insist on another unpopular measure that will see 10 percent of the money received by some pension funds – from taxes levied on third parties in place of employers’ contributions – being channeled to strengthen funds in dire financial straits. Government sources said they expect the bill to be tabled in about one month.