The third austerity measures package – commonly called “Third Memorandum” of 13.5 billion euro, was brought to Greek Parliament with the signatures of all government ministers on Monday afternoon. The relevant committee of the Parliament will discuss the bill tomorrow Tuesday as of 11 a.m.. The bill will be discussed at the plenary of the Parliament on Wednesday, while the voting will take place the same day, traditionally at midnight. An additional voting will take place on Sunday (after midnight) on the Budget 2013.
The bill contains 150 measures, that is new spending cuts and euphemistically called ‘strusctural reforms that will turn upside down the life of every Greek with incredible cuts in wages and pensions, sharp cuts in health care and social welfare benefits, cuts in allowances, overturning of any labour rights, utilities price increases but also opening of closed professions, only to mention a few.
According to To VIMA the savings will be:
*Restructure of public sector 719 million euro
*Municipalities 210 million euro
*Wages, bonuses and allowances cuts 1.497 billion euro
*Pensions, increase of retirement age 5,475 billion euro
*Cuts in social welfare 307 billion euro
* Health care sector 1.113 billion ευρώ
*Defence spending (closure of military camps, cancellation of new armament deals etc) 406 million euro
*Education (universities & technical colleges mergers, reducing funding in sports and culture 133 million euro
*Cut sin state-run enterprises 495 million euro
*New taxation system (cancellation of tax free amount, tax hikes in tobacco products, tax hike in the interests rates from bank deposits from 10% to 15% etc) 3.89 billion euro.
Cuts, Cuts, Cuts
230 pages that will leave millions of households with a minimum income enough just to cover basic needs. According to leaked information main changes will be:
- Cuts in main and supplementary pensions 5% for 1,000-1,500 euro, 10% for 1,5001-2,000 euro and 15% for pensions in more than 2,000 euro.
- Increase of retirement age from 65 to 67.
- Social welfare benefits (EKAS) for low-pensioners only for those over 65 years old.
- Cuts for special payrolls 2% for wages up to 1,000 euro and up to 35% for more than 4,000 euro monthly salary. Retrospective as of 1. August 2012.
- Up to 40% salary cuts for employees of state-run enterprises and municipalities.
- Abolition of Christmas/Eastern & Vacation bonuses to wages of civil servants and pensioners.
- Cuts in several allowances of civil servants.
- Increase of working hours from 36.5 hours per week to 40 hours per week for civil servants.
- Decreases in overtime payments
- Reductions in pensions for disable.
- Reductions in jobless allowances, i.e. seasonal workers
- Reduction in social welfare spending
- Hiring scheme 1:5 until 2015
Cuts in health sector will leave thousands if not millions without sufficient health care:
The bill foresees among others: Reducng health services for uninsured (25% of Greeks are without job, while uninsured labour blooms), reducing medicine from official lists, reducing spending for health care cost (medical services and drugs)
In addition a new taxation system will raise taxes for low and medium incomes and reduce taxes for the rich.
Despite junior coalition government partner Democratic Left insisting in not voting in favor of the labour rights ‘reforms, and some defiant MPs from partner PASOK and PM Samaras’ Nea Dimocratia, the bill is expected to pass with 154-155 votes.
The bill that will specifies our lives for the next decades needs a simple majority of 151 votes to be accepted.
The spending cuts and structural reforms are a precondition for Greece to receive the bailout tranche of 31.5 billion euro. Prime Minister Antonis Samaras said recently that the country has money until November 16th. The billions that will come with the bailout tranche will be spent for the recapitalization of the banks and by the state to pay outstanding debts to suppliers.
Under time pressure Greek government is pushing for the bill to pass through the Parliament and thus before the Eurogroup meeting on November 12th, where the eurozone finance ministers were allegedly to give the green light for the disbursement of the 31.5 billion euro.
No Tranche at Eurogroup meeting?
However on Monday evening, REUTERS reported that a relevant decision at the upcoming Eurogroup meeting is unlikely.
A deal on keeping Greece afloat and providing more bailout money for the near-bankrupt state is unlikely to be reached next week when euro zone finance ministers meet in Brussels, a senior EU official said on Monday to Reuters.
The official, who was attending the meeting of G20 finance ministers in Mexico City, said the euro zone still had to find a formula to make the Greek debt sustainable and finance it and that several countries, including Germany, also had to discuss the matter with their parliaments.
“The November 12 meeting will not be the final stage. We΄re not so much under the gun as it may seem,” the official said, adding that Greece could meet its financial obligations without further financial assistance until the end of November or even early December.
“A deal is still likely in November, but not necessarily on November 12,” the official also said. “There will be no deal until there is a deal on all the different strings of the package. We will not disburse the next tranche until all details are in place”.
Unions of the public and private sector have called for a wave of strikes on November 6th and 7th, 2012, to protest while the government and the parliament will be discussing and voting for the financial Armageddon.
PS Taking into consideration that bill voting takes starts at midnight, I’m afraid we are really government by pumpkins. (I may have written the same sentence also on the voting of 1. and 2. packages of austerity measures. Apologies. But I’ve ruin out of words to comment.)
BTW: did you notice that public sector and state-run enterprises still give wages more than 4,000 euro???