12,8bil euros in hidden measures for “Memorandum no3”

New VAT increase on the table – Objective values are up – Closed professions and privatizations are the new burning issues

New, unpleasant surprises and conflicts with entire work sectors are hidden in the revised “Memorandum no3”.  
Before next March and the Troika audit, the government must show its true intentions and bargain for the “hidden measures” that will create 12bil euros in the triennial from 2012-2014. At the same time, other hot issues are brought up with privatizations and the opening up of closed professions.

With the VAT increase, the cuts at DEKO, the changes in labor and the wage cuts in the private sector, the economic team is getting ready to confront engineers, lawyers and pharmacists.

Under Troika pressure, Yiorgos Papandreou will present the plan for the opening up of closed professions and privatizations, in the ministerial meeting next Tuesday. According to sources, major reversals will come to all professions at the same time, excluding perhaps notaries, for whom certain legal issues arise.

Tomorrow, the inter-ministerial committee for privatizations will convene and clarify not only the immediate solutions (ie wage cuts) but also the long term plans (securitization when the market conditions will be in favor).
 

New measures in 212 too

Meanwhile, the government is “re-writing” the Memorandum and right after the holidays, they will have to make clear through which new measures it will save 12,8bil euros in the triennial from 2012-2014.

In the next meeting with the Troika in March, the government will have to negotiate for “day after” measures. Initially, the “non-distributed” actions not specified in the Memorandum for 2012 did not exceed 700 million euros. But in the revised Memorandum they reach 2,6bil euros to cover the black hole in the 2009-2010 deficit. The timetables until the next audit are tight and the government is worried whether they will lead to greater depression.

However, the government will seek out solutions – and further revenue – again in taxes: VAT increase, new transfers of goods from low to high rate (from 13 to 23%), but also a new raise of objective values in real estate.