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Worried Samaras Mulls Cabinet Shake-Up

Greek Prime Minister Antonis Samaras
Greek PM Antonis Samaras

Concerned that his ministers are reacting too slowly to implement reforms demanded by international lenders, Greek Prime Minister Antonis Samaras is reportedly considering replacing some of them, the newspaper Kathimerini reported.
With tax revenues falling far short of expectations despite big tax hikes, with the pace of privatization lagging, and with his ministers dragging their feet, Samaras is said to be anxious that the government is falling behind its ability to meet fiscal targets to keep bailouts coming and prevent more austerity measures that he vowed to resist.
That comes as inspectors from the Troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) are about to return to Athens to check progress on promised reforms. If Greece falls behind, they could order more pay cuts, tax hikes and slashed pensions, which have set off unrelenting protests, strikes and riots.
Kathimerini said that Samaras, the New Democracy Conservative leader, will meet his coalition partners, PASOK Socialist leader Evangelos Venizelos and Democratic Left (DIMAR) chief Fotis Kouvelis on Feb. 18 to discuss how to proceed.
The newspaper said that serious delays in the implementation of reforms allocated to several ministries have prompted the premier to consider a government reshuffle, most likely next month following the scheduled congress of PASOK, where Venizelos faces a serious challenge to his leadership with the party’s popularity plummeting in polls
Both Venizelos and Kouvelis are reportedly interested in increasing their parties’ involvement in the cabinet. They had previously refused to have any of their members be appointed, fearful of an even stronger backlash from their constituencies for their support of more austerity measures.
It remains unclear which ministers are likely to be dismissed though sources suggest that Samaras is unhappy with the performance of the Health, Administrative Reform, Environment and Justice ministries. Finance Minister Yiannis Stournaras and Public Order Minister Nikos Dendias are believed to be the only two whose portfolios are “safe,” while Development Minister Costis Hatzidakis may be flanked by another official to boost efforts at drawing sorely needed investment.
Samaras was scheduled to meet with Hatzidakis over the weekend to discuss stalled plans for privatizing state assets – a rich potential source of much-needed revenue that remains largely unexploited due to fears of the politcal cost of projects that will incense unions as well as bureaucratic hurdles.
The country’s two main labor unions have called for a 24-hour general strike on Feb. 19 to protest austerity, although three years of similar demonstrations have failed to deter successive government from following Troika orders.
Besides union pressure, Samaras is facing failing economic indicators despite austerity and big bailouts that haven’t slowed the country’s economic slide. If he doesn’t find ways to increase revenue, he could be forced to break another promise, this one not to impose more austerity even though pay cuts, tax hikes and social security contributions are already eating up nearly half of Greeks paychecks, while tax evaders who owe $70 billion have gone largely unprosecuted.
The government will need to find ways of bolstering revenue, which last month was 7 percent below the budget target, while social security contributions are down by some 15 percent. With virtually no progress on the levels of investment and privatization, it is expected that the Troika will push the government to boost tax revenue and proceed with layoffs in the public sector.
While unemployment is at a record 27 percent – 67.1 percent for those under 25 – that is all in the private sector as no public workers have been laid off although the Troika has said at least 150,000 should be let go over the next three years because they are unneeded.

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