Layoffs in the public sector

The Greek government is now waiting for the final decisions of troika as the first round of consultations ends today, with the meeting of Administrative Reform Minister Kyriakos Mitsotakis with the heads of the creditors that has started from 10 am.

After a week of fermentations and tensions it will be followed by a meeting of troika with Stournaras where the envoys of the lenders are expected to show if they insist on their negotiating attitude, taking advantage of the time pressure felt by the Greek side until the eurogroup in Athens.

Despite the cautious optimism for a positive outcome of the negotiations, the government sees that there are serious problems such as with the OECD reforms and banks, raised just as troika returned to Athens.

In the final stretch of the negotiations that must be completed before the eurogroup of March 10, lenders seem to keep open almost all issues the Greek government wants to immediately close, as:

- the OECD list that includes, among others, changes in fresh milk, non-prescription medicines, bread and books

- the recapitalization of banks, where BoG is expected to announce next week the final height of the capital needs of Greek banks, estimated at 5.7-6.2 billion euros

- mobility of 25,000 employees and 4,000 layoffs in the public sector. The meeting with Mitsotakis today will show if the goal has been reached or troika will ask for more

- decrease of employer contributions by 3.9% as a lump sum from this year. Troika does not want a reduction of contributions from employees by 1% or 1.3%

- the height of the primary surplus that will be distributed and to whom. Troika wants to put it on the safety net drafted by the Labour and Social Protection Ministry, while the Greek government is considering targeted measures to remedy injustices

The economic team says there is no budgetary gap or need for additional measures for 2014 and for 2015 it calculates the budgetary gap at less than 1 billion euros instead of over 2 billion as troika says.