Tuesday, April 4, 2017

Greek Pensions Hot Potato Puts Tsipras in Bailout Tight Spot

by Sotiris Nikas & Antonis Galanopoulos


April 4, 2017

Athens resident Spiros is among the reasons Greece is having a hard time reaching a bailout accord with creditors.

The 82-year-old is one of about 2.7 million pensioners likely to face a cut in monthly payments for the 12th time since the debt crisis in 2010, as part of the measures required for the disbursement of the next tranche of emergency loans. The government of Alexis Tsipras wants any new cuts in pensions to be phased in gradually and not be put in place from 2019 -- an election year -- as creditors demand. It says it wants to protect pensioners like Spiros, who account for more than a quarter of the country’s 10 million population and are already bracing for higher health insurance costs and a lower income-tax-free threshold.

The government says a brutal cut will further erode the purchasing power of pensioners and worsen an economy that has shrunk by a quarter in the past seven years and left more than 23 percent of the work-age population without jobs. Spiros, who takes home a pension of 1,200 euros ($1,281) a month, is supporting not just himself and his wife, but two adult children, their spouses and a grandchild.

“I am struggling to meet my obligations,” he said, declining to provide his last name because he fears he’ll embarrass his family. “So far I’ve been able to pay all my taxes and bills, but I don’t know if I can keep doing it.”


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