Troika is leading Greece to a dead end

They are asking for tougher measures

 

 

After the meeting between representatives of troika with the PM, Finance minister Evangelos Venizelos and Labour minister George Koutroumanis on Sunday evening, the three political leaders who support Papademos’ government are now with their back against the wall. Troika insists on its demands for four crucial issues: minimum wage, bonuses, continuance and insurance contributions. The political leaders will discuss the new data on Sunday with Papademos and possibly make decisions, after the latest negotiations that will be completed shortly before their appointment.

During the meeting at Maximos Mansion, troika brought back its original proposal for 35% weighted average reduction in supplementary pensions and the trimming of lump sums. The explanation provided by the representatives of the lenders was that the Greek government had enough time to negotiate with the leaders of the three parties. Since they didn’t reach a decision even if they agree with the proposal of Koutroumanis for a 15% reduction and consolidation of Funds - which had been accepted by troika -, then they would have to implement the original proposal of the lenders.

Regarding minimum wage and bonuses, Koutroumanis insisted that if they will be reduced, the government will have to estimate revenue loss of 1 billion euros from taxation.

Lastly, regarding the issue of social security contributions they seem to have reached an initial agreement for a decrease of 10%. The decision whether to issue terms to business or not still remains to be taken. Koutroumanis promotes the contribution reduction of companies under three conditions:

a) usage of a working card

b) all transactions to be made through the banking system

c) absolute consistency in the reimbursement of contributions

Troika disagreed with this proposal and asked for the elimination of rules. Papademos’ intervention during the discussion of this issue was decisive in favor of Koutroumanis. Troika representatives did not insist and referred the matter to the Sunday meeting that will be held at the Labour ministry, where officials will discuss other outstanding issues as well.