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Greece: PM reaches deal with party leaders over bailout terms

Posted by seumasach on February 9, 2012


9th February, 2012

Government sources have revealed that a deal has been reached over how to find the 300 million euros in savings that the troika was demanding to prevent cuts to pensions that three parties in Greece’s coalition government were not willing to accept.

An official in the premier’s office told Kathimerini English Edition that Prime Minister Lucas Papademos had held talks with New Democracy leader Antonis Samaras and a solution had been reached.

Samaras had objected to auxiliary pensions falling below 300 euros per month. He was supported by Popular Orthodox Rally (LAOS) leader Giorgos Karatzaferis.

PASOK chief George Papandreou had objected to any shortfall being made up by cuts to basic pensions.

The government official said that the 300 million euros would come from cuts in defense spending and other areas but did not give any other details.

A statement is expected shortly.

In a news conference, European Central Bank president Mario Draghi confirmed that a deal had been reached. «I received a phone call a few minutes ago from the Greek prime minister and he told me that an agreement has been reached and endorsed by the major parties,» he said.

Draghi refused to comment on whether Greek bonds held by the ECB would be included in the country’s restructuring scheme.

The disagreement over pension cuts was the only obstacle to Greece concluding talks with the European Commission, the European Central Bank and the International Monatery Fund over the terms of a new bailout, which is likely to be at least 130 billion euros.

Finance Minister Evangelos Venizelos has flown to Brussels for a Eurogroup meeting, where eurozone finance ministers could decide whether to progress with a new Greek bailout.

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