Layoffs in the public sector? Ask the government!

According to Troika requirements the Greek government will have to make cuts in the health and public sectors and strengthen the tax collecting mechanism. The auditors paid tribute to our performance and assured us that we will get the 9 billion euro next month...

These sectors will judge whether Greece will receive the 4th installment.

Specifically, at the press conference this Tuesday morning  S. De Rouge(European Commission), P. Thomsen (IMF) and D. Blanc (ECB) indicated that "the Greek program remains broadly on track", adding however that the coming period will be very important for the progress in implementing the program of economic policy.

"All the quantitative performance criteria set for the end of September were met. Despite the challenges that remain, significant progress has been made in terms of fiscal adjustment" as stated in the joint statement by the IMF, EU and EC.

 
But the bell tolls for the structural changes, as it is emphasized that "despite the significant progress made in areas of reform, with the reform of the pension system as a central reference point, the program has reached a critical juncture."
 
According to Troika, we must focus on:

- aligning the wages with productivity at company level through changes in systems of collective bargaining and arbitration

 
- opening access to services, commerce and crafts
 
- Developing the potential of the Greek industry, by minimising bureaucracy and barriers for market entry
 
Characteristically, Mr. Thomsen said the biggest risk for the Greek economy is to delay the reforms, while Mr. De Rouge estimated that in case of rapid implementation of structural changes and under certain conditions, the Greek economy could potentially show a growth of 3% of GDP.
 
The auditors noted that there are too many employees in the public sector; they referred to the government on whether there will be layoffs in SOEs and the public sector, and stood on the fact that Greece has committed to a workforce reduction by applying the rule that for each recruitment, five layoffs have to be effected.

They added that improvements are needed to allow greater flexibility in the labor market, preventing the automatic extension of collective agreements to those not participating in collective bargaining. Mr De Rouge, however, assured that minimum wages will not be affected by the operating contracts, which will supersede the sectoral ones.

Finally, regarding the possibility of extending the repayment of the loan, it was indicated that discussions are being held, although without agreement yet.

«There are options such as lengthening the time of borrowing and the refinancing of loans for which we are ready. We are convinced, however, that Greece will be able to return to the markets and repay the loans, said Mr. Thomsen.