Greece nears troika deal
Two sides close on public sector cuts, details of privatization agency yet to be settled
The Greek government and the representatives of the European Commission, European Central Bank and the International Monetary Fund, collectively known as the troika, are nearing agreement on the details of the midterm fiscal plan and privatization program but several key stumbling blocks remain, sources told Kathimerini.
Among the issues still to be resolved is whether representatives of the troika will have seats on the independent committee that will oversee the sell-off of state assets and whether these places will come with veto powers.
Sources said that the government has agreed on a number of measures that will be included in its midterm fiscal plan. Among these are further cuts to the benefits received by civil servants and an extension of the time frame in which they can receive a pay rise from two to five years.
The government also appears to have agreed to adjust its hiring policy for the public sector. After prompting from the troika, PASOK had decided to hire one civil servant for every five that leave but this will now be changed to one for every 10 that depart. The public investment program will also be limited to 1 billion euros per year.
Among the other potential measures being discussed is the closure of public enterprises, which will inevitably lead to job losses. Another option is the closure of all or some of the state TV channels, which would be replaced by a smaller public broadcaster.
A sticking point, however, could be the formation of the independent agency that will oversee the privatization scheme, which is supposed to raise 50 billion euros by 2015. The troika has insisted that its representatives have a say in the body’s decisions and that they are able to block any moves they disagree with. They have also demanded that no representatives of the government be allowed to participate in the agency and that any decisions it takes should be protected by law so that they cannot later be reversed by a different government.
Sources said that both sides are looking to wrap up negotiations by tomorrow night. Troika representatives have delayed their departure until Saturday, after which they will deliver their assessment on whether Greece should receive the June installment of its loan package, worth 12 billion euros. This will be discussed at an emergency meeting of eurozone finance ministers on June 6 or 13.