ATHENS – More bad news is brewing for Greek workers in a seemingly endless onslaught of pay cuts and tax hikes. In return for bailout loans keeping the country afloat, the Troika of the European Union-International Monetary Fund-European Union wants Greece to get rid of the country’s minimum wage guaranteeing workers at least 750 euros, or $247 a week in income.
After taxes, that amounts to $187 a week. The gross wage has led disenchanted Greek youths to call themselves the 700 Euro Generation.
The newspaper Kathimerini reported that the Troika, which sets conditions in Greece in return for $152 billion in bailout loans, told the government to change its national collective bargaining contract which sets the minimum wage or end it so that employers can tell workers what they will pay them.
The newspaper said the demand was made during a meeting between Labor Minister Giorgos Koutroumanis and Troika representatives and that Prime Minister George Papandreou reacted angrily to the condition. “Collective labor contracts apply,” he is reported to have told a group of PASOK MPs from central Macedonia during a private meeting. “We are not, nor do we have any intention of becoming, India or Bangladesh.” So far though, he has acceded to Troika demands to cut workers pay, slash pensions and raise taxes.
The newspaper said sources reported the government was urged to hold talks with labor unions to discuss renegotiating the collective contract with the aim of reducing salaries. But the Troika apparently asked that if a deal is not possible then the government should move to change the law to allow the minimum wage, currently set at about 750 euros gross or 570 euros net, to be reduced.
Sources said the troika asked that collective contracts which apply to specific sectors of the economy should not be renewed for the next three years. Last year, after pressure from its lenders, the government passed a law allowing employers to bypass the contracts and ask their employees to accept lower wages. There was no official reaction to the Troika’s demands but sources said that Koutroumanis pointed out that if wages are reduced, social security contributions and consumption would also suffer.
Troika representatives also met with New Democracy leader Antonis Samaras and his aides after the Conservatives requested a chance to present their ideas for reducing public sector costs. ND is opposed to the scheme that will lead to some 30,000 civil servants being placed on standby with a view to losing their jobs. It argues that costs can be cut without any job losses. Kathimerini said the Troika dismissed New Democracy’s interests.
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