German banker Jϋrgen Stark, chief economist of the European Central Bank and famous with his conservative economic views, accompanied Olli Rehn during his first visit to Athens as the Commissioner of Economic Affairs of the European Union. The appearance of Stark in the Greek capital acted as a cold shiver to local politicians. "For years Greeks have been spending much more than they were earning. The measures announced by the government to tighten the discipline are the absolute minimum,” said the conservative banker for Der Spiegel magazine. His appearance next to Rehn was interpreted by Greek media as a bad portent.
Indeed, Olli Rehn, left no doubt in the Greek government on what measures he is expecting from them. "We want a dramatic reduction of the burden of public sector salaries in the state budget,” was explicit the Commissioner for Economic Affairs of the European Union. This means either to reduce the number of employees in the public sector, which in Greece is impossible because the Constitution states that public employees cannot be discharged, or to reduce their wages. Which the Greek government will do.
To the direct question of whether the 14th salary for public employees will be stopped, Olli Rehn said that concrete decisions will be taken and announced by the Greek government. "For us it is clear that the burden of salaries in the state budget should be reduced strongly", said the Commissioner. According to him in the coming days before the weekend, the government will have to declare a specific way in which it will reduce the cost of government salaries. Whether the government will reduce the Easter and Christmas salary by 30 percent, the fee for taking annual leave by 40 percent, or it will cut off the entire 14th salary, is a matter of tactics.
For now the question cutting the 14th salary in the private sector, is not being discussed. Overall, employers have not raised the subject, nor is it of interest to the Commission at this time. Olli Rehn urged for radical changes in the retirement system in Greece - an increase in the retirement age for men and women, stopping the government funding of pension funds and freezing all pensions at least within the calendar year 2010. Once his meeting with the Minister of Employment Andreas Loverdos started, in front of the Ministry gathered protesters, who were rut with police forces.
The Commissioner for Economic Affairs of the EU was also accompanied by representatives of the International Monetary Fund and European Central Bank. During his final press-conference he asked the opposition parties, trade unions and all citizens of Greece to support the painful reforms in order to improve the future of Greece. According to local media if all measures are being put into practice, the income of the average Greek would fall by 30 to 40 percent. This includes the cut of the 14th salary, the increase of VAT by 2 percentage points and the increase of excise duty on fuel, alcohol and cigarettes, and introducing a new luxury tax benefits.
"Courage!" said in conclusion Olli Rehn.