What Eurostat will say to us, what we are going to say to the Troika

Today marks the unveiling of the new measures that will be announced by the government to the Troika in the first ten days of May. In the meantime, however, we will see Eurostat’s announcements on the 2010 deficit, the inter-party fermentations in PASOK and the actions for Labor Day.

Today, the European Statistical Office will announce the final (?) size of the deficit of 2010, which is the “basis” for all plans and measures for 2011-2015. If it is ultimately confirmed that the 2010 deficit reached 10,6% instead of 9,4% as has been estimated so far, then there is a need to cover a “hole” of another 2 billion euros. But the government believes that the additional package of measures of 3 billion they plan to implement within the year, will be able to cover the needs that originate from last year, and the new gaps and failures of 2011, also reaching 2 billion euros within the first quarter of the year.
 
What are we going to say to the Troika

The final shape of the privatization and securitization plan drawn up by the government will arrive within the week and before the opening of parliament after the Easter break, as the aggregate tables will be delivered to the Troika on May 3. The first teams are expected on the 6th of May in Athens, followed by the heads who will arrive on the 10th.

The aim is to collect 2-4 billion euros in 2011 alone from the package of the 50 billion, which entails the utilisation of state property with an estimated revenue of 35 billion by 2015.

The package will include:

- 10%-15% of OTE to the Germans of Deutsche Telekom, for 450 million in revenue, with a 15% premium on the shares to be transferred

- 250-million revenue from the renewal of mobile network licenses

- sale of the Hippodrome by 2012, in which French investors have already expressed interest

- distribution of DEPA shares

- sale of LARKO

- extension of the contract with the Germans for the “Eleftherios Venizelos” airport

- sale of 55% of the shares held by the state

- sale of the commercial portion of the Deposits and Loans Fund and

- securitization of the State Lottery.

For 2012:

- sale of 34% of the OPAP shares owned by the state

- transfer of 17% of PPC shares, meaning a reduction of state participation by 51% to 34%, without the state losing control and management of the company and despite the severe reactions by GENOP

- public-private partnerships for the operation of ports and regional airports by 2012.
 

Allowances, wages and tax breaks

The issues that remain unresolved include the specification of the exemptions that will be abolished, as well as the beneficiaries who will lose them, in order to cut 2 billion annually.

The government will also examine property and income criteria; not meeting these criteria will result in the loss of social benefits for thousands of beneficiaries, expertise on how to reduce the public wage bill by a further 2 billion euros, while the single payroll still remains a thorn in its side.

The coming days will see the announcement of a plan against tax evasion aiming at the collection of 3,5 billion euros, while the Troika is waiting to see the plans for the consolidation of SOEs, which will cut another 2,5 billion.

The new salary scale for civil servants will be voted on in June, in order to save (by 2015) approximately 3,5 billion euros from the wage bill through the promotion of a four-year assessment of workers instead of the present two-year one.

Information indicates that highly paid public servants (those at tax and customs services and with specific salaries) will not avoid the cuts that might reach 30%. At the same time we should expect the financial support of those employees who are highly qualified but receive lower wages than the compulsory education employees.

The reduction of directors’ and supervisors’ positions is also provided, the number of which will drop from 24.000 to 20.000, while the vacant permanent positions will also be decreased. The government plans to introduce part-time permanent staff with lower earnings, a measure aimed primarily at mothers. There will also be the possibility of unpaid leave for 5 years, in order for the employee to work in the private sector. The government's mid-term plan includes the increase of working hours to 40 per week, along with a drastic cut of overtime.