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Categorized | Economy

Greek police protest at pay cut plans

Posted on August 31, 2012

Hundreds of police, fire and coastguard officers protested outside the Greek parliament on Friday against unprecedented wage cuts for “workers in uniform”.

Members of the armed forces will also be included in a 5-10 per cent across-the-board salary reductions for state security employees, along with deep cuts in special allowances.

    The moves are part of a new €11.9bn austerity package, aimed at ensuring that Greece can remain a member of the eurozone, which will be presented next week to visiting officials from the EU and International Monetary Fund.

    Friday’s protest highlighted a last-minute dispute between the finance ministry and the defence and public order ministries over €900m of spending cuts in 2013-14.

    The latest measures, agreed under Greece’s second €174bn bailout, target parts of the public sector excluded from previous efforts at fiscal consolidation because of fears about the potential political cost.

    “We are already living below the poverty line. . . We’re only getting by because of the special allowances,” said Christos Fotopoulos, president of the police officers’ association.

    A senior government official said that alternative cost-cutting measures proposed by the defence and public order ministers to avoid wage reductions were unlikely to be accepted by the “troika” of EU, European Central Bank and IMF officials as sufficiently “permanent” reductions in expenditure.

    “We face a very difficult choice,” the official added. “If we don’t cut uniformed workers’ salaries we will have to extend pension cuts to the lower end of the scale where people are already enduring hardship.”

    Cuts to pensions, healthcare, public sector wages and social benefits will make up almost €8bn of the new package, with €2.2bn of savings to come from the abolition of extra Christmas and Easter payments to pensioners.

    Details of the measures were leaked to Greek journalists on Friday, following their approval in principal by leaders of the three-party coalition government. Final decisions will be taken next week following consultation with the troika, before the package goes to parliament for approval.

    Dimitris Kyriazides, a former police officer and conservative lawmaker, said he expected defections from the conservative New Democracy party, the senior coalition partner, if wage cuts for the military and police went ahead.

    “Given the long hours and tough working conditions in law enforcement, it is hard to justify these proposals,” said Mr Kyriazides.

    Some lawmakers in the Panhellenic Socialist Movement and the Democratic Left – the other two parties of government – have threatened to vote against the package if pensions below €1,400 monthly are cut.

    Antonis Samaras, the prime minister, has pledged that the latest package will mark the final round of public sector spending cuts to be imposed under the current reform programme.

    “People simply can‘t take any more,” he said, after five years of recession and a series of increasingly harsh austerity measures over the past 18 months.

    A senior finance ministry official said the focus would switch next year to boosting revenues through privatisation, a renewed crackdown on tax evasion and measures to restore growth after 2013. Greece loses about €28-€30bn annually in uncollected taxes, according to finance ministry surveys.

    “There has to be social justice on the revenue side,” the official said. “That means expediting court cases for alleged tax evaders and ending the practice of suspending sentences for convicted offenders.”