Tuesday, February 19, 2013

Cash-strapped Greece dodges 1,900 public sector firings

ATHENS (Reuters) - Greece said on Monday it would not fire almost 1,900 civil servants earmarked for possible dismissal, despite promising foreign lenders it would seek to cut the public payroll.

Under a deal with creditors, the workers were put last year into a "labour mobility" scheme, meaning they would receive about two thirds of their salary and be dismissed within 12 months if no other public sector jobs were found for them.

Leader of Democratic Left party Fotis Kouvelis addresses parliamentarians in Athens November 7, 2012. REUTERS/Yorgos Karahalis

Late on Monday, the ministry for administrative reform said it had identified about 2,400 vacancies for them, mainly in hospitals, courts, prisons and police desk jobs.

"The aim is to man sensitive, frontline positions which provide services to citizens," the ministry said.

The European Union and the International Monetary Fund have lent Greece about 240 billion euros (206.8 billion pounds).

Under Greece's latest bailout plan agreed in November, Athens is to put 27,000 public sector workers into the labour mobility scheme by the end of the year.

The mobility scheme does not set a specific target for dismissals. But it states that "a large share of those entering this program (are expected) to ultimately transition to the private sector, notably via mandatory exits".

Greece must overall cut 150,000 public sector jobs from 2010 to 2015, about a fifth of the total, through hiring curbs, retirements and dismissals. The EU says it insists on this because Greece's public wage bill more than doubled from 2001 to 2009, a period in which the euro area's rose by less than half.

But anxious to avoid even harsher austerity measures amid the country's deepest post-war recession and record unemployment, Greece's fragile coalition government hopes to fulfil its target through hiring curbs and retirements.

Speaking late on Monday, the leaders of the two smaller parties in the ruling coalition ruled out any firings.

"There will be no dismissals," said Fotis Kouvelis, head of the moderate Party of the Democratic Left after meeting Prime Minister Antonis Samaras. Kouvelis added, without elaborating, that workers caught breaking the law could be removed.

Talk of public sector dismissals is "fairytales", said Socialist Party leader Evangelos Venizelos, also at the meeting.

(Reporting by Harry Papachristou and Lefteris Papadimas; Editing by Jason Webb)

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Tuesday, February 19, 2013

Cash-strapped Greece dodges 1,900 public sector firings