Creditors keeping close eye on statistics
As the government prepares to submit its draft budget for 2011 in Parliament today, there are reports of growing concern among Greece’s creditors regarding the credibility of official state data. The government’s draft budget for next year reportedly contains no major surprises. The draft, which is to be updated next month, foresees the imposition of an additional 5 billion euros in taxes – 600 million euros of which is to come from a one-off tax on corporate profits – and envisages a further reduction in state spending, by 1.5 billion euros. But, according to sources, there are growing doubts among officials of the European Commission, International Monetary Fund and European Central Bank regarding the ability of Greece’s public administration to effectively collect taxes and submit reliable statistics regarding the country’s finances, particularly those for the public sector. The lack of reliable statistics is reportedly hindering the envoys from accurately assessing the progress of Greece’s fiscal adjustment and determining what measures need to be taken to offset deviations. One problem, sources say, is that the debts of many state-run enterprises have yet to be factored into the assessment of the overall debt burden. Last Friday it emerged that the state would be assuming the financial commitments of the Hellenic Agricultural Organization (ELGA) and the Organization of Payments and Monitoring of Community Funding, Orientation and Guarantees (OPEKEPE), amounting to more than 4 billion euros. This is expected to boost public debt by 1.7 percent. In June, the government announced an overhaul of the Hellenic Statistical Authority following reports that authorities had provided the Commission with false statistics the year before.
