Small majority for austerity raises big doubts

first_imgA stormy, all-day debate in parliament culminated in a flimsy majority of 153 MPs approving the harsh austerity package of 13.5 billion euros worth of mostly wage, pension and welfare cuts in the next two years, with a further 5 billion euros of cutbacks in 2015-16, as dictated by the Troika of Greece’s creditors. “The vote’s result marks a large, decisive and encouraging step towards economic recovery and better days for the country as a whole,” said Prime Minister Antonis Samaras after the results of the vote count were announced shortly past midnight. “We’ve sent a strong message [abroad] that Greece has turned a page,” he added. Parliament was besieged by tens of thousands of protesters in the afternoon while opposition lawmakers from left-wing SYRIZA and conservative Independent Greeks often interrupted the debate with motions of constitutional or parliamentary irregularity. This further undermined the 250-page, one-article bill’s legitimacy, which had already been denied by two landmark high-court rulings, one by the State Auditors’ Council on Monday and another by the Supreme Court on Wednesday. Budget cliff-hanger Parliament is also scheduled to vote on Sunday for the 2013 budget that incorporates wage, pension and benefit cuts worth 9.5 billion euros, in another cliffhanger for the government. This is because the coalition’s junior partner, Democratic Left leader Fotis Kouvelis, has urged his 17 MPs to vote in favour of the budget draft while having abstained in yesterday’s vote on the omnibus austerity bill which included the bulk of the measures written into next year’s budget. If a number of DemLeft MPs decide to vote against or abstain again, the budget may be voted down or passed by a smaller majority than Samaras had hoped. But the vote result is also bound to raise doubts among the country’s reluctant creditors about the viability of the heavy burden which Samaras’ alliance has undertaken as well as the sustainability of Greek debt which is now forecast by the IMF to reach 189 per cent of GDP in 2014. Eurozone leaders may therefore decide to split the tranche disbursement into smaller instalments starting from November 27, further delaying the urgently needed recapitalisation of the Greek banking system and the payment of arrears owed by the Greek state to its private suppliers and contractors. Facebook Twitter: @NeosKosmos Instagramlast_img

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