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October 23, 2017

Greece okays new austerity and makes way for reform package bill


Newsroom24x7 Desk

greeceAthens : Greece has moved a step forward in which Athens has promised to present a new comprehensive plan to overhaul the ailing pension system by the end of 2015.The new Left-led government passed the first crucial test since taking office after the September 20 snap general elections. 154 of total 155 members of parliament of Radical Left SYRIZA party, represented by Prime Minister Alexis Tsipras and the Right-wing Independent Greeks (ANEL) party coalition, voted in favour of the bill, while 140 deputies voted against and six adstained by were absence. The bill included a new round of tax hikes for all taxpayers, a matter which already evoked strong reactions. The bill also outlined an introduction of tougher penalties for tax evaders. The bill further stated a framework of new pension system reform which would take care of gradual phasing out of early retirement and further pension cuts.

The bill sparked off a debate during which opposition parties and labour unions, who opposed several provisions of the omnibus bill, argued that the prolonged austerity and the kind of reforms would not lead to revival of the ailing economy, and chances are it would rather cause destruction of Greek society. Finally, number count resulted in bill getting approved by the ruling Greek legislators, who approved on Saturday an omnibus bill containing a set of prior actions, which the country pledged to its international creditors in order to unlock the next bailout loan instalment in the coming weeks.

The new bill helps to foresee that retirement age would be gradually raised to 67 years for all, over the next seven years, and those who take an early retirement would face a further 10 percent cut on their pensions. The ratification of new austerity and reform measures had been preconditioned for continuation of review of Greek program by lenders that would make available the first two-billion-euro (about $2.3 billion) aid tranche from Greece’s third bailout, planned out months ago.

Greece has agreed to a three-year aid package totaling 86 billion euros. Tsipras made a U-turn from his party’s previous anti-bailout rhetoric in recent months, pledging a quick implementation with certain necessary changes that would enable the path of securing the new 86 billion euro loans over the next three years to eliminate the risks of default. This is expected to bring Greece back on the path of development.

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