Labour challenge for new Greek government

AFP , Wednesday 30 Nov 2011

Greece's new government faces its first labour challenge with unions set to hit the street against a fresh round of austerity cuts tied to European loans that are keeping the country on its feet

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Demonstrators from the communist-affiliated trade union PAME march during a rally against the public sector layoffs in Athens, Tuesday (Photo: Reuters)

Another general strike on Thursday, the sixth this year, will shut down public services, paralyse trains and ferries and put state hospitals on emergency staff levels.

Municipal workers will also walk off the job, meaning garbage will not be collected for at least a day.

Greek journalists are leading the way with a 24-hour strike on Wednesday to protest against major layoffs in recent months in the nation's struggling media outlets, followed by a four-hour work stoppage on Thursday.

The beleaguered nation received a dose of good news late Tuesday when European finance ministers said the eurozone was set to unlock 8.0 billion euros ($10.7 billion) blocked since August because of reform delays.

The Greek finance ministry said that crucial talks with private creditors had officially begun in Brussels to secure a 50-percent write-down on the country's 350 billion euros debt mountain.

"Negotiations have begun ... formally between Greece and the private sector, with the participation of the euro working group, the European Commission, the EFSF, the International Monetary Fund and the European Central Bank," a ministry source said.

The European Financial Stability Facility was set up to support struggling eurozone economies such as Portugal and Ireland in the aftermath of the first Greek bailout in May 2010.

The eurozone in October agreed a second bailout deal for Greece, offering to slash its maturing debt burden by 100 billion euro but the agreement—along with loan payments from the 2010 aid package—has been held up by reform delays and bickering between Athens and Brussels.

A Greek plan to put the eurozone deal to a referendum last month backfired, with EU creditors denouncing a breach of confidence and precipitating a political crisis in Athens.

Socialist Prime Minister George Papandreou stepped down as a result and a unity government was formed to ratify the latest bailout and hold early elections.

The two top unions that have spearheaded resistance to the cuts, private-sector GSEE and civil service ADEDY, say that wage and pension sacrifices will continue despite the inclusion of austerity critics in the government.

"There must be no illusions, austerity will continue in 2012 and so will our mobilisation because insecurity and the threat of unemployment persist," GSEE chairman Yiannis Panagopoulos told AFP.

The new government, headed by former central banker Lucas Papademos, inherited a budget that cuts public spending on education and health, and will also implement a tax system shake-up that lowers tax breaks and introduces new income thresholds to broaden the taxpayer pool.

The cabinet now includes members of the opposition conservative and far-right nationalist parties who have strongly criticised the Greek economic overhaul drawn up last year and monitored by experts from the European Union, the European Central Bank and the International Monetary Fund.

But all the coalition partners have pledged to ratify the latest reforms laid down in the budget, which heads for a vote in parliament in early December.

GSEE and ADEDY, which officially represent over a million employees, have held over a dozen general strikes in the last two years.

"Greece is the guinea pig and Europe's legal and political culture is being put to the test," ADEDY chairman Costas Tsikrikas said ahead of Thursday's action.

Civil servants, once considered among the country's luckiest job holders, have suffered wage cuts of 40-50 percent since May last year, Tsikrikas said.

The ranks of the unemployed—already at over 800,000—will swell further under a plan to oust 150,000 civil servants by 2013, he noted.

A first wave of state redundancies hit this week with 20,000 civil servants nearing retirement told to clear their desks.

Staff at public transport companies have warned that services will drastically deteriorate as a result and employees at Greece's civil aviation authority reacted by taking over the company's headquarters.

"This is a cursed day for the public service and state employees," ADEDY said, arguing that the move was unconstitutional and would rob departments of their most experienced staff. 

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