Sun Sentinel Broward Edition

Greeks fear pension lifeline will be cut more

- By Derek Gatopoulos and Raphael Kominis Associated Press

ATHENS — Looking tired and leaning on his cane, Fotis Theodorako­poulos watched quietly as other demonstrat­ors gathered to discuss Greece’s financial drama and chant defiant slogans outside the parliament.

Although he stayed on the sidelines, the 69-yearold said he was fully aware that Europe was about to decide on his future.

The region’s leaders this week are examining new Greek economic reforms demanded in exchange for loans that could determine the country’s survival in the euro bloc — and its financial prospects for years.

After six years of recession, Greece is offering nearly $9 billion in new savings. But the savings will come mainly from raising taxes on businesses, households and the purchase of goods in an effort to spare pensions, which creditors wanted trimmed.

Greece’s government Tuesday defended the billions in “harsh” new budget savings it has of- fered as some of the governing party’s own lawmakers spoke out against them.

“There is full comprehens­ion that there are measures in the proposal that are harsh, and they are measures that under different circumstan­ces, if it was up to us, there was no way we would have taken,” government spokesman Gabriel Sakellarid­is said.

The pensions are based on a state-funded system and have become a flashpoint in the talks on how to heal Greece’s public finances. They are hugely expensive for the government, but have already endured big cuts and a large and growing number of Greek families depend upon them as a safety net against poverty.

By one government estimate, pensioners’ income has been cut by an average of 40 percent since the financial crisis began in 2009.

“We don’t want to them to sign another bailout agreement. If they cut pensions any further it will finish us,” said Theodorako­poulos, a retired security guard. He receives a $1,135 monthly pension that he uses to help his disabled daughter.

Greece’s creditors — made up of fellow eurozone states and the Internatio­nal Monetary Fund — wanted the government to slash funding to the pensions system by at least $2 billion in exchange for more bailout loans. The country needs the loans urgently as it faces a debt repayment June 30 that it cannot otherwise afford.

Lenders are reviewing its latest offer of reforms and some officials say a deal is possible this week.

The Greek government offered some measures to make the pension system more financiall­y stable, but spared any cuts to pensioners’ income. Instead, it suggests increasing the contributi­ons that employers pay for pensions and phasing out early retirement rights.

Unlike most eurozone members, Greece’s welfare system is relatively weak, with effectivel­y no social housing or rent assistance programs, while the jobless receive benefits and state health coverage for up to one year.

 ?? DANIEL OCHOA DE OLZA/AP ?? A labor union protests in Athens on Tuesday amid new talks over economic reforms.
DANIEL OCHOA DE OLZA/AP A labor union protests in Athens on Tuesday amid new talks over economic reforms.

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