The tough negotiations between the Labour Ministry officials and the IMF/EU/ECB representatives continue following a complication of Wednesday that almost imperilled the disbursement of the fifth aid tranche and bring new austerity measures.
The negotiations reached a deadlock regarding both revenues and expenditures. The troika questions the feasibility of the medium-term target of €3.5b by 2015 through fighting of contribution evasion and the 2011 budget execution, while it does not approve the special grant of €700m to the Greek Manpower Employment Organization (OAED) in order to meet the growing demand for unemployment benefits.
The unit of international lenders asked for the coverage of this extra expense to take place through the current account created for Social Insurance Institute (IKA) and OAED, as IKA owes more than €5b to OAED.
If IKA covers the gap of OAED, then the deficit for the social institute will exceed €2b, which will automatically pass on General Government’s deficit.
As regards the execution of this year’s budget, troika officials consider optimistic the decline of revenues by just €1.6b, while they asked the ministry officials to revise the target of €3.5b through fighting of contribution evasion, as the reduction of uninsured employment from 26% to 14% is considered highly unlikely through the existing mechanism.
The issue of labour agreements is expected to be discussed on Thursday, with the representatives of foreign lenders seeking clarification on the delays of legislative provisions on working time and temporary contracts.
Meanwhile, a commission met for the first time on Wednesday for the reform of the list of arduous and unhealthy occupations. According to initial estimates, about 200,000 occupations may be removed, while 50,000 employees will be included in the list. Administration employees in heavy, chemical and pharmaceutical industry will be excluded.
According to the Deputy Minister of Labour Giorgos Koutroumanis, a total amount of 538,000 employees are insured in the category of arduous and unhealthy occupations. This figure is considered significantly reduced, due to the high rate of unemployment in specific industries.
The list is expected to be completed by June 15.
The negotiations reached a deadlock regarding both revenues and expenditures. The troika questions the feasibility of the medium-term target of €3.5b by 2015 through fighting of contribution evasion and the 2011 budget execution, while it does not approve the special grant of €700m to the Greek Manpower Employment Organization (OAED) in order to meet the growing demand for unemployment benefits.
The unit of international lenders asked for the coverage of this extra expense to take place through the current account created for Social Insurance Institute (IKA) and OAED, as IKA owes more than €5b to OAED.
If IKA covers the gap of OAED, then the deficit for the social institute will exceed €2b, which will automatically pass on General Government’s deficit.
As regards the execution of this year’s budget, troika officials consider optimistic the decline of revenues by just €1.6b, while they asked the ministry officials to revise the target of €3.5b through fighting of contribution evasion, as the reduction of uninsured employment from 26% to 14% is considered highly unlikely through the existing mechanism.
The issue of labour agreements is expected to be discussed on Thursday, with the representatives of foreign lenders seeking clarification on the delays of legislative provisions on working time and temporary contracts.
Meanwhile, a commission met for the first time on Wednesday for the reform of the list of arduous and unhealthy occupations. According to initial estimates, about 200,000 occupations may be removed, while 50,000 employees will be included in the list. Administration employees in heavy, chemical and pharmaceutical industry will be excluded.
According to the Deputy Minister of Labour Giorgos Koutroumanis, a total amount of 538,000 employees are insured in the category of arduous and unhealthy occupations. This figure is considered significantly reduced, due to the high rate of unemployment in specific industries.
The list is expected to be completed by June 15.
