GREECE: Social Security Reforms Spark Unrest

By Apostolis Fotiadis Reprint | | Print |

Apostolis Fotiadis

ATHENS, Mar 21 2008 (IPS) - Millions of workers participated in a general strike Wednesday on the eve of a parliament vote on pension and social security reforms. Despite vehement opposition, the government voted the reform through with 151 votes, the absolute minimum required for passing the legislation.

The conservative-neo liberal government has engaged in a head-on confrontation with unions for the past two weeks since the announcement of reforms which will sharply cut benefits.

The banking sector faced serious disturbances when strike action spread to the Central Bank of Greece. The Athens Stock Exchange had to stop trading for two days, Mar. 4 and 5, “to protect investors and ensure the smooth functioning of the market,” Hellenic Exchanges, the bourse operator, said in a statement.

Since then a continuing strike by power sector workers against the reforms and the privatisation of large parts of the public electricity monopoly has led to nationwide blackouts.

And over the past two weeks, thousands of tonnes of garbage has piled up on the streets, raising concerns about public health. Over the last few days, transportation has been seriously disrupted, as railways, port and air traffic staff joined the strike.

“Participation in the strike is total. We are talking about millions of workers,” Spyros Papaspyros, head of the civil servants’ umbrella union Adedy, said in a statement.

The government has attempted to turn public opinion against the unions.

“This cannot be accepted by any lawful and democratic society and any civilian in this country,” minister for employment Fani Palli Petralia, who is responsible for the reforms, told daily Kathimerini. “It is a deeply antisocial and antidemocratic behaviour.”

But unions say the majority seem to think otherwise. A survey ordered by the banking unions showed 71 percent opposition to the reforms, and 69 percent support for the strikes.

The reforms will eliminate early retirement schemes, and merge 133 pension and social security funds into less than ten, while reducing medical care benefits.

The government says the debt-ridden pension system faces collapse unless sweeping reforms are immediately implemented. Many agree that the monstrous number of funds makes the system inefficient, and burden it with enormous administrative costs.

Despite a majority of just two in a parliament of 300 the government is committed to radical changes to a welfare system that is considered partly responsible for a 2.7 percent budget deficit and a record public debt of 117.2 percent of the Gross Domestic Product (GDP).

But according to a study by the General Accountant of the State, the reforms will save a relatively small 433 million euros a year, and only after 2018. The state loses three times as much every year from tax evasion.

“The measures will only secure the viability of the system for another two years,” Stathis Anestis, press representative of the General Union of Workers in Greece, told IPS. “And they will reduce the deficit only about 6 percent.”

The government, he says, has taken no action against employers who owe billions of euros in social security contribution. “The state itself does not act responsibly in paying contributions to funds for its civil servants.”

Anestis says there are lists of companies who evade their responsibilities. These include construction businessmen thriving on major public works and media tycoons exploiting undocumented labour, he said. This is leading to losses of up to 6 billion euro annually through failure to pay social contributions, he added.

“Collecting only 20 percent of this social security funds income would gain viability for another seven years,” he said. “The government does nothing simply because it does not want to fight big interests.”