Will the knife in the heart of DEKO reach OPAP and DEI?

The government wants to finish with the rough measures of 2011 before 2010 expires, and is in a race against time so that the PM will be ready for the coming summit this December in order to present prepared solutions and complete bills, and counter Angela Merkel’s reactions against the extension of the 100bil euro loan.

For this reason the government brings a new bill for voting that will be presented today at the ministerial meeting by minister of Finance Giorgos Papakonstantinou, which will put a cap on DEKO wages at 50,000e annually – maybe even less.

Completely verifying the “Papakonstantinou prophecy”, who last week was saying that “we will cross our own selves”, the “venerable ceremony” for the “massacre” of salaries in the 52 companies directly controlled by the state is expected to end in a few hours.

The economic team is dealing with this as a “communicational counterweight” in the decrease of salaries in the private sector, which will also be discussed in the meeting

Surprises are not excluded, like the extension of this measure to listed companies like OPAP and DEI, from which the state can receive a higher dividend income, if their wage bill is cut.
 

The non-productive DEKO

They have every reason to be worried especially about these since, according to the data of the ministry of Finance, average wages in 2009 were very close to the limit and many of them beyond.

For example OSE, ISAP, ILPAP, ETHEL, EAS, EAB, ETA, TEO and ODIE recorded losses of 1,7bil in 2009 while the wages were at 1,2bil. In some the salary cost (including employer contributions and not what is eventually pocketed) exceeded even the annual revenue of the organization.

In practice, the cost per employee ranges in most of them from 2000-4000e per month. Specifically in ISAP the average annual cost for a worker was 56,554e, at TRAINOSE 49,732e, ODIE 47,608, EAB 43,733, ETHEL 37,021, ILPAP 35,476 and TEO 28,609.
 
DEI is burning…

But the “fires” are lit in the profitable or listed DEKO too. In DEI for example, in 2009 (according to the yearly budget out in 2010) staff costs amounted to 1,117bil euros. Besides the 22,582 workers ,we must add another 3,000 with contracts, each of whom received 42,000e annually.  

According to information from DEI management, these sums include “in-kind benefits” such as clothing or the summer camps for the children of the employees.

But on page 96 even bigger amounts are indicated: 1,31bil is listed as staff salaries and 378mil as employer contribution. 3,6 more are reduced-price power (a privilege for DEI workers and pensioners). That’s 1,69bil in total, which means a 65,000e yearly joint cost for each employee.

From this we have to subtract the  “embedded” staff costs (in “embedded assets” and “cost for mining coal”) 211+368mil = 579mil, which translates to a yearly cost of 1,117bil for 26,000 workers and 42,000 per year.

However, the net income does not go beyond 25,000-26,000 per year on average, since insurance contributions reach 40% of the cost for each worker.

It is indicative, however, that despite efforts to contain the wage bill in recent years, with the exit of about 5,000 employees from 2005 onwards, wage cost has been increasing rather than decreasing: as stated on page 79 of the 2005 report for the 22,278 workers the fees and levies paid by DEI reached 1,4bil euros (minus 450mil “embedded” fees = 950mil), which means they increased rather than drop, by almost 50% (or 20% with “integration”).

So the average cost per month per employee increased from around 4,200e to 6,000e in 5 years (almost 50% overall or 10% annually).