Greek government backs its embattled statistics chief

By Dina Kyriakidou

ATHENS | Thu Jan 24, 2013 10:43am EST

Jan 24 (Reuters) - Greece's government on Thursday backed its embattled statistics chief, accused in felony charges of artificially inflating budget deficit figures to make the country's debt crisis appear worse.

Greek statistics agency ELSTAT head Andreas Georgiou has denied wrongdoing and the European Union's own Eurostat statistics agency has defended him, saying the deficit was calculated in line with its standards.

"The ministry does not doubt in any way the statistical data on which the present (economic) programme is based," a senior finance ministry official told Reuters on condition of anonymity.

The Greek debt crisis was triggered in late 2009 when the then Socialist government revealed the budget deficit was grossly underestimated. Georgiou was appointed in 2010 in an effort to restore the credibility of Greek statistics.

Government officials defended his record, saying he worked closely with Eurostat to streamline methods and provide credible figures, despite resistance from within the agency, echoing EU statements.

"Eurostat has been clear that it finds the revision of the Greek republic's finance data for 2009 by the Greek statistics service ELSTAT to be reliable and ... Greek data followed all the EU rules applicable," said Emer Traynor, a spokesperson for Algirdas Semeta, the EU commissioner in charge of tax policy.

However, an economic crimes prosecutor formally slapped felony charges on Georgiou and two other ELSTAT employees on Thursday, on evidence that they falsified the country's 2009 fiscal data, a court official said.

The case stems from allegations by an ELSTAT employee who was dismissed that Georgiou inflated the deficit numbers as part of a German-led conspiracy to justify harsh austerity measures to accompany a bailout.

Georgiou, a 52-year old veteran International Monetary Fund statistician, said Greece's decision to ask its international partners for help was based on statistics produced by his predecessors, long before he was put in charge of ELSTAT.

"It is striking that a criminal prosecution ... did not take place when Greek statistics were a constant source of concern," he said in a statement. "I will continue to apply the law, despite the adversities."

He has denied similar allegations in the past, describing them an "unprecedented" case of statisticians being investigated for producing figures under EU regulations.

The charges reopen last year's domestic political row on whether wrong fiscal data in late 2009 were to blame for forcing Athens to seek an international bailout that has since swollen to 240 billion euros - the biggest sovereign rescue in history.

In November 2010, shortly after Georgiou took over, the 2009 budget deficit was revised again to more than 15 percent of gross domestic product from 13.6 percent, indicating the scale of Greece's fiscal derailment and deepening the country's crisis.

If convicted on charges of breach of faith - a crime that usually applies to those who embezzle or misuse public funds - Georgiou could face at least five years in jail.