Vijlbrief: Next round of pension cuts in Greece a given

Wednesday, 13 June 2018 14:21

By V. Kostoulas

Any change or revision in agreed to measures for Greece's social security system, even after the current memorandum ends in August, will have to be decided within the framework of a latest agreement between institutional creditors and the Greek side, Eurogroup Working Group (EWG) president Hans Vijlbrief clarified on Wednesday.

The new EWG chief, who took over from Thomas Wieser this year, spoke in Brussels and referred directly to another round of cuts in Greece's social security system, which come online at the beginning of 2019. Although the specific austerity measure has been agreed to by the Tsipras government and ratified by a Parliament majority of MPs backing the latter, repeated statements by top Cabinet members of the now poll-trailing coalition refer to "prospects" and "efforts" to ultimately avoid or lessen the politically sensitive spending cuts.

Vijlbrief's indirectly responded to a press question over the Greek side's statements that it "may" water down social security cuts in the post-memorandum period - after August 2018.

Moreover, the EWG chief said he was confident that yet another agreement over pending Greek program issues - a fourth review of the ongoing bailout, debt relief, remaining 'prior actions' etc - will be achieved before the next scheduled Eurogroup meeting on June. 21.

He also reminded that no precautionary credit line has been requested by Athens in the post-bailout period. In echoing other top Eurozone officials, he said IMF involvement in the Greek program as a lender would be a positive development, but not necessary.  

In a related development, Greek Labor Minister Efi Achtsioglou told reporters in Brussels that her government does aim to "lessen the burden" on people that have been hurt by pension cuts, or even reduce the scope of scheduled cuts for pensioners.

At the same time, while walking a political "tightrope", she acknowledged that the next round of social security spending cuts has passed into law. For the coalition government, she said, the emphasis now is on successfully concluding all open issues - fourth review, debt forgiveness measures and the type of post-memorandum supervision stipulated for Greece after August 2018.

"Our position is that these (latest austerity) measures are unnecessary. Pensioners in Greece have suffered; pensions are low, and spending for social security, in the medium period and long term, will hover at the European average," she said.


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