"New" Memorandum on civil servants' wages

A new and tough memorandum with additional measures and a strict cap on the salary of civil servants, but also on the costs incurred by public companies, hospitals and insurance funds, has been asked of the government by the “tough guys” of the Troika.

With a lightning trip to Athens, the heads of our lenders arrived in the city, went straight to George Papakonstantinou’s office and requested explanations as to why the new wage policies have not been enforced, but also on the 235 public agencies who refuse to send evidence to the Ministry of Finance and on their hidden deficits.

Especially concerning the latter, the Troika seeks to implement an even tighter policy, perhaps with the severity of a specific Memorandum.

According to sources, the Troika representatives requested:
-New cuts of up to 20% in public services costs
-Cuts in the highly-paid employee “bonuses”
-Wage costs reduction to 45-50% of total revenue from all public utilities, from the 78% reached in 2009.

The proposal to close down certain loss-making enterprises was once more put on the table. The economic team argued, however, that the "here and now” measures are premature, since the 2010 deficit has not been finalized, and it has not been shown whether or how to evaluate the measures already taken by the government.

They requested and received additional time until April 15th to discuss the issues in the cabinet in order for them to become law by May 15th and before the next Troika visit relating to the 5th loan installment check.

The replacement of the “toughest” Troika member Servaas Deroose is only thought of as occasional.

In any such case, although Mr. Deroose "took the rap" for the clumsy announcement about the 50-billion privatization plan during March’s inspection, his replacement by Mr. Jurgen Kroeger does not mean that Greece can relax.

As Director General of Economic and Financial Affairs of the European Commission, it was Mr. Kroeger who, during yesterday’s meeting at the Treasury, was the most well-versed and gave answers to key arguments put forward by the government’s economic team.