Greece Set to Vote on Bailout Provisions

 NIKI KITSANTONISNOV. 5, 2015

The New York Times

ATHENS — Greek lawmakers on Thursday were poised to approve some of the economic changes that international creditors were demanding before unlocking the first loan installment from the country’s bailout program. But the legislation pointedly lacks some of the main measures demanded by lenders.

On a visit to Athens on Wednesday, Pierre Moscovici, the European commissioner for economic and monetary affairs, indicated that more might need to be done before the money would be released. Eurozone finance ministers are to meet on Monday to decide whether to sign off on the first 2 billion euros, or $2.2 billion, in loan money from the €86 billion bailout program.

Last month, Greek legislators agreed to further pension cuts and to some tax increases but deferred politically difficult measures that included placing stricter criteria for the protection of struggling mortgage-holders and revoking tax breaks for Greek farmers. The bill that faced a vote Thursday included the revoked privileges for farmers and a tighter framework for tax collection, and it was expected to be approved for the most part.

Approving the bill on Thursday was just one of a series of tasks ahead for Greek officials, who are wrangling with creditors over demands for the stricter treatment of delinquent homeowners as hundreds of thousands of Greeks struggle to make mortgage payments.

Prime Minister Alexis Tsipras has broached the issue with European officials who have visited Greece in recent days, noting that a wave of repossessions would threaten social cohesion. Greek officials are also scrambling to find alternative measures to a value-added tax on private education in the country, which the government hastily withdrew following a public outcry.

The government is also under pressure from creditors to prepare legislation this month overhauling the dysfunctional pension system, a hugely controversial measure following the barrage of fresh cuts.

Social discontent over austerity continues to grow. Farmers, mariners and pharmacists are among those who have staged protests in recent weeks, and the country’s two main labor unions have called a general strike for Nov. 12. It will be the first such walkout under the left-wing Syriza party, which, while in opposition, had a constant presence at anti-austerity protests and strikes.

The government is keen to secure the first tranche of Greece’s latest bailout to ensure state coffers do not run totally dry as they did over the summer. Official figures for government revenue in the first nine months of the year showed a €2 billion shortfall as Greeks struggled to pay higher taxes. Athens does not face major debt repayments until December, when it must pay the International Monetary Fund around €1.2 billion in three installments.

Greece’s economy remains sluggish, and no improvement is likely soon. The European Commission’s official figures on Thursday predicted that the economy would contract 1.4 percent this year and 1.3 percent next year before growing 2.7 percent in 2017.