Greece expects deal for further bailout aid

Updated: 2013-04-14 05:11


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ATHENS - Greece is expected to strike a comprehensive deal on the conditions for the release of further bailout aid to Athens this spring by Tuesday, Greek Alternate Finance Minister Christos Staikouras said on Saturday afternoon, after a fresh meeting between government coalition partners.

"The final details will have been sorted out by Monday evening," Staikouras told reporters upon his exit from Prime Minister Antonis Samaras' office following talks on the progress in tough negotiations with envoys of international lenders in Athens over the past two weeks.

Conservative Samaras and leaders of the two junior center-Left parties supporting the coalition agreed on a common stance regarding the last and thorniest issue under discussion with European Union and International Monetary Fund inspectors - the shrinking and reorganizing of the overblown public sector to slash costs and strengthen efficiency, Staikouras said.

According to the latest plan, a total of 15,000 civil servants will be dismissed by 2015 through the closure and merger of state entities and a labor reserve program. The first to go would be employees indicted on disciplinary offenses, according to the plan.

An equal number of young people with more skills are expected to fill in the vacancies gradually, while a total of 180,000 employees are forecast to have left the civil service by 2015 through an additional retirement scheme, Democratic Left leader Fotis Kouvelis added.

The job positions of civil servants in Greece have been protected under Constitution for decades, therefore the issue was sensitive for the government.

In an interview with a local daily on Saturday, Samaras clarified that the layoffs are not illegal if the job positions will be abolished.

Another reason behind Athens' hesitation to proceed to mass firings of civil servants was the record high unemployment rates, fueled by austerity policies introduced since May 2010 in return of the vital international financing to avert default.

More than one quarter of Greece's working force today is jobless. With some 3,000 employees in the private sector getting redundant on a daily basis over the past few months, several officials and ordinary citizens argue that it is about time for a drastic overhaul of civil services.

Socialist PASOK party chief Evangelos Venizelos on his part expressed hope that an agreement with troika could be finalized as soon as Sunday night, as all contentious issues on the agenda of talks with auditors since the start of their latest review in late February of the progress of Greece's stability and growth program, have now been resolved.

According to Staikouras, there are no more pending points on the arrangements of loans and debts to insurance funds and tax authorities to ease the burden on recession- hit taxpayers, on the coverage of fiscal shortfall and the reduction of a real estate property tax.

A positive progress report by the foreign inspectors is expected to clear the way for the disbursement of almost 9 billion euros (11.8 billion U.S. dollars) in new rescue loans to Athens in May.