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14,000 civil servants in Greece will be paid not to go to work

08 September 2011 / 21:09:19  GRReporter
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14,000 civil servants will be included in the labour reserve program from the beginning of October this year. Thus, public sector employees, who have to be dismissed, will go on a year paid leave during which they will receive 60% of their gross salary. If during that year they fail to find new jobs, they will be permanently redundant from the public sector. This is the measure the socialist government decided to apply after the Troika had left unexpectedly for the media in the middle of the last week, telling the Prime Minister George Papandreou and his ministers to complete the planned reforms so that Greece can get the six tranche of the bailout.

The labour reserve is imperative because two years the government did not dare to reduce the employees in the public sector, which already is widely recognized as an extremely large, cumbersome and inefficient. It burdens the budget and costs taxpayers billions. Economic analysts have that the numerous ministries and state institutions found for years have had similar functions, and a large number of public enterprises have been operating at a loss for years without taking any recovery measures.
 
Greece's economic crisis has revealed many of the unhealthy elements in the local government sector and the latest austerity program provides a series of mergers, restructurings and closings of troubled companies. They will lead inevitably to job losses.

The union of public sector employees, in turn, does not accept the government's arguments that a bankrupt country is unable to sustain such an exaggerated public administration. They are against the introduction of the unified system that will make equal the public sector wages (a general payroll table), but also against the labour reserve. Unionists determine these measures as antisocial, although many of the ordinary citizens think the labour reserve is unfair mainly because civil servants will receive money for doing nothing all year, when private sector employees do not have this option. Social security for unemployed is significantly lower than sixty per cent of the average salary of a civil servant.

It should be noted that the labour reserve would enable the government to hold the increase in unemployment for a year. Although the officials will not work, they will not be considered unemployed and will not burden the PASOK statistics for the unemployment level for at least 12 months. Despite the technical tricks applied, the Scientific Institute at the union of private sector employees believes that the unemployment will exceed 22% -23% by 2013, which would be detrimental to the social security funds.

Much water will flow under the bridge until 2013 and one of the most serious problems of the Greek government after public servants remains the privatization. The long list of companies for sale remains the same and at the end of September, the Minister of Finance Evangelos Venizelos will have to prove to the supervisory Troika at least € 1.4 billion revenues from privatized enterprises. For this purpose, instead of cutting state institutions, Papandreou’s government established an agency to exploit the private property of the state. It will manage the privatization process.

Now, the Ministry of Finance is willing to start with the easiest transactions to collect the necessary funds by the end of the month. They include the extension of the concession period of the contract for the management of the Athens airport Evangelos Venizelos to 20 years, the renewal of the licenses of the mobile operators in the country and the renewal of the gambling permits of the National Lottery (OPAP). The more difficult transactions include the sale of the government stake in Hellenic Petroleum, which is currently around 35%. The corporate Latsis family that owns the remaining major part of the company is expected to take over the share. OPAP also is in the list of companies for sale, but by the end of the year. The treasury hopes to take around a billion from there, and the state should raise half of that amount from the privatization of the gas company DEPA.

 

Tags: EconomyMarketsLabour reserveCivil servantsPublic sectorGreecePrivatization
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