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Victoria Mindova

Before looking for easy solutions and cast serious charges, all must ask themselves what would have been the reduction in GDP, unemployment, poverty and the number of closed shops, if Greece had not signed the Memorandum of financial assistance. This replied the Finance Minister Georgios Papaconstantinou to the complaints and attacks of the representatives of public organizations at the debate about the medium-term plan for rehabilitation of the Greek economy.

"All must understand the problem in depth. Yes, nobody likes the measures we have undertaken, but let's imagine now just for a moment what would we do without the help of countries in the Eurozone and the International Monetary Fund", said Papaconstantinou.

 He described an example situation in which Greece decides that it doesn’t want and can no longer comply with the provisions under the Memorandum of financial aid and announces that it will not reform the public sector, government structure and the state budget. The country has no access to the free markets, and the financial aid is stopped because the country does not comply with arrangements for fiscal consolidation and structural reforms.

The Finance Minister said that if this scenario was followed through one morning Greek people would face the challenge to deal with finance, it has - 80 billion euros revenues and 120 billion euros costs. "There are 40 billion euros deficit, where would this money be found and what must first be cut." He emphasized that in the current budget only the salaries of state employees are over 20 billion euros. At approximately the same levels are also the expenses for salaries and pensions.

"We must learn to live with the money we earn," said Papaconstantinou. He stressed that after the end of the Memorandum for the period 2012-2015 the measures for fiscal consolidation will amount to 22 billion euros, and two thirds or 14.5 billion euros will come from restructuring the costs and 7.5 billion euros from an increase in the revenues. Tax rates will not increase, but the focus will be on combating tax frauds and tax evasion.

The ambitions of the Finance Minister George Papaconstantinou are in 2015 to form a primary budget surplus of 5 per cent. There is no way this can happen only with measures for budget cuts, and for economic growth we can not even talk in times of recession, opposed the unions. George Papaconstantinou assured them that the level of pensions, salaries and taxes will not change, but in order to have success the current efforts Greece must be united. Through structural reforms and change in the economic policy after five years, Greece has to reduce total amount of budget expenditures by approximately 54% of GDP to 45% of GDP, as it is in almost all European countries.

The social partners highlighted as one of the mistakes of today's government the permanent changes in the tax law. They share the opinion that currently reigns the rule "new day, new tax law." This, combined with higher tax rates do not favor the attempts to attract new investments, as is the ambition of the socialist government. To this attack Papakonstantinou has replied and other public announcements. His main argument for the permanent changes is that a tax law that will determine the tax policy needs time, which today the government lacks. Therefore additions and amendments to the law are necessary.

George Papaconstantinou faced criticism also in the field of social economy and in particular reducing the cost for public healthcare and putting restrictions on the budgets of hospitals. Minister answered this very clearly: "I refuse to live in a country that allows everyone to spend what he wants from the public money without control, without limits and without penalty. This type of policy brought us to the state we are in today".

Finally, the Minister of Finance said that the government institutions, social partners and political opposition have the moral and professional obligation to seek for a consensus on the strategic development of the Greek economy. "In the dialogue are born ideas and solutions to problems, so we must all participate in it", said Papaconstantinou and once again in their absence he invited the political parties which did not responded to the call for cooperation.

"The money from the financial aid is money of taxpayers from 16 European countries. They credited us so as to reduce our deficit. This should not be forgotten", recalled in conclusion the Minister of Finance.

Meanwhile, after Standard & Poor's, the credit rating agency Fitch also issued a warning that Greece will have to face a reduction in credit rating. In the same cluster are Spain, Ireland and Portugal. The agency said that only the combination of strict enforcement of the common European policy, fiscal consolidation and structural changes of all countries will allow to put an end to the debt crisis of the euro area. Otherwise the crisis will escalate and will expand to dangerous proportions.