Greece agrees to retrench civil servants

IMF's troika representative to Greece Poul Thomsen, right, speaks as Greek Financial Minister Yannis Stournaras listens during a conference on the economy in central Athens, Monday, April 15, 2013. Greece cleared a key hurdle in its drive to receive its next batch of bailout loans after international debt inspectors said Monday they had reached an agreement over the country's economic reforms, including the firing of civil servants.(AP Photo/Petros Giannakouris)

IMF's troika representative to Greece Poul Thomsen, right, speaks as Greek Financial Minister Yannis Stournaras listens during a conference on the economy in central Athens, Monday, April 15, 2013. Greece cleared a key hurdle in its drive to receive its next batch of bailout loans after international debt inspectors said Monday they had reached an agreement over the country's economic reforms, including the firing of civil servants.(AP Photo/Petros Giannakouris)

Published Apr 16, 2013

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Elena Becatoros Athens

GREECE cleared an important hurdle in its drive to receive its next batch of bailout loans after international debt inspectors said yesterday that they had reached an agreement over the country’s economic reforms, including the firing of thousands of civil servants.

The review by delegates from the International Monetary Fund (IMF), European Commission and European Central Bank – known collectively as the troika – was part of a regular process under which Greece receives instalments of its multibillion-euro bailout.

“Greece is being stabilised and our position is being bolstered,” Prime Minister Antonis Samaras said in a televised address yesterday. “Late last night we reached an agreement for the disbursement of the next instalment of e2.8 billion (R32.1bn), and the road has opened for the May instalment of e6 billion,” Samaras said.

Greece has been dependent on e270bn in bailout loans and other rescue packages since 2010. In return, successive governments have pledged to overhaul the Greek economy and imposed stringent spending cuts and tax hikes.

Almost every troika review since the start of the bailout has been delayed due to targets being missed or disagreements with the government. Apart from the initial instalments, no rescue loans have been disbursed on time.

Despite often major differences between the two sides, there was less tension for this review, without the threat of imminent bankruptcy that had hung over many previous talks.

The reforms have been painful for Greece. The country is mired in a deep recession, currently in its sixth year, and unemployment has spiralled to around 27 percent.

In a joint statement, the three institutions said that recent steps taken by Greece would mean that targets for March “are likely to be met in the near future” and that the country’s debt sustainability “remains on track”.

As a result, the 17-nation euro zone could soon agree to disburse e2.8bn pending from last month. The euro zone and IMF board are expected to approve the review next month.

The review also covered the dismissal of civil servants.

The government and troika have been wrangling for weeks over the firing of civil servants, something which has not happened during the crisis so far despite pressure from Greece’s creditors to reduce its bloated public sector.

The review said that the firings would be “targeted at disciplinary cases and cases of demonstrated incapacity, absenteeism, and poor performance, or that result from closure or mergers of government entities”.

Samaras said 15 000 civil servants would be removed by the end of 2014, with 4 000 of them by the end of this year.

The departures would include sacking those who had been convicted of criminal offences or disciplinary violations, voluntary retirements and retrenchments from positions that have been axed.

New young employees would be hired to fill places left vacant, he said.

During a conference on the economy in central Athens, the IMF’s troika representative, Poul Thomsen, said: “It’s still a taboo to dismiss people from the public sector. There have been no forced dismissals of employees whose positions are eliminated or who do not perform.” – Sapa-AP

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