Slashes to auxiliary pensions of more than 128 euros

Proto Thema – The new plan for Greek social security reform is to be submitted to Greek Parliament in mid-January rather than December 23 as originally expected. Despite the objections of the so-called Quartet of creditors (EC, ECB, ESM, IMF), Athens insists on alternative proposals for the increase of contributions so as to avoid pension cuts.

European Commission representative Declan Costello appeared ready to give an extension until February, but the labor ministry does not want a two-month delay as most of the measures need to be applied from January 1, 2016.

Greek opposition parties continue to consider the Radical Left Coalition (SYRIZA) government’s cries for concensus to be nothing more than “communicative tactics.” The National Confederation of Greek Workers (GSEE) union refused to participate in dialogue that was begun by the Economic and Social Council of Greece. A key in negotiations are creditors decision to increase contributions by one unit point so as to save 300 million euros for 2016 and avoid pension reductions.

The Labor Ministry insists on applying the rule of viability, ie. an alternative clause for the zero deficit to ensure the viability of the joint auxiliary fund. Sources state that, for the fund deficit to be covered, there would need to be cuts from 6-10% to pensions over 128 euros for more than 800,000 pensioners. Scenarios for cuts to pensions of more than 170 euros or 200 euros was rejected.

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