NEWS

Countdown to key legislation gets under way

According to sources, the government hopes to have completed within the next three weeks the drafting of legislation that is key to Greece meeting the targets it has been set by the European Union and the International Monetary Fund, including a bill that will lead to many employees at public enterprises (known as DEKOs) accepting a 10 percent pay cut. The details of the draft laws that the government has to prepare in order to usher in a range of structural reforms are due to be discussed at a Cabinet meeting today. During the discussion, Prime Minister George Papandreou is expected to make it clear that he wants to go to next Thursday’s European Union leaders’ summit armed with a specific timetable about the changes that will be made as he expects to come under pressure from his EU peers with regards to the measures being taken by Greece to slash its deficit. The key pieces of legislation to be discussed are a draft law being prepared by Regional Development Minister Michalis Chrysochoidis aimed at encouraging investment, a bill on the liberalization of postal services and private investments in the mobile phone sector, which is being overseen by Infrastructure Minister Dimitris Reppas, and a law to allow the creation of a body to manage the research and extraction of hydrocarbons (petroleum or mineral oil). However, the most urgent legislation due to be discussed today are three draft laws that will have an immediate impact on the Greek economy: a bill on labor relations that will allow companies to bypass collective contracts if they are facing financial problems; a bill that will raise the middle band of value-added tax from 11 percent to 13, although hospitals and pharmacies will see their VAT rate reduced from 11 to 6 percent; and a bill overhauling the way that DEKOs operate and are managed. According to sources, the government has decided that all DEKO employees with gross earnings of 1,800 euros or above will have their salaries cut by 10 percent and that nobody will be allowed to earn more than 4,000 euros a month. The bill, which is due to be approved by the Cabinet today, will also limit the amount of supplementary or overtime pay that a DEKO employee can earn so it is equal to 10 percent of his or her salary. The government has been asked to save 800 million euros in spending on DEKOs in 2011. The wage cuts and ceilings are expected to bring in about half that amount. Tickets on public transport, which make up the bulk of DEKOs, are expected to increase by 30 to 50 percent next year. Thousands of transport workers, who were on strike yesterday, gathered in central Athens to protest the changes.