With a 3-vote majority (when the government coalition has a lot more MPs), the Greek Parliament voted the 3rd Memorandum on Wednesday at midnight. It is characterized by drastic rigor, increasing the deregulation of labor markets and services as demanded by foreign creditors. To get the EUR 31.2 loan the country needs to avoid bankruptcy, with the possibility of non-payment in mid-November, the government should convince itself that it has made enough progress with its stabilization reforms. The 216-pages long document defines a new series of austerity measures for 2013-2016 (to save EUR 18.9 billion) essentially entails cutting spending (pay, pensions), making labor law more flexible (notably layoffs and working time) and increasing taxes. (Ref. 120655)
The greatest efforts will be in the civil service (over €7.6 billion), continuing the pay cuts and cutting 80,000 jobs – replacing only 1 in 5 retiring staff. However, the private sector will pay as well, with measures such as the introduction, in April, of new, lower minimum wage (monthly and daily pay), removing automatic increases “as long as unemployment is over 10 percent.”
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