The Greek negotiating team have insisted they did not walk out of a meeting with creditors over the weekend but that talks broke down because their counterparts did not have the authority to negotiate.
The coordinator of the Greek negotiating team, Euclid Tsakalotos told Euronews’ Efi Koutsokosta that he was told clearly that the officials on the other side had no mandate to negotiate but that discussions could resume as soon as they can meet a team empowered to take the necessary steps.
Regarding the content of the talks, Mr Tsakalotos revealed that the discussions focused on fiscal issues adding that “there is no disagreement with the institutions on the fiscal gap for 2015. Discussions focused on the 2016 fiscal gap”.Analysing the state of play he said that “the institutions estimate a fiscal gap 2.5 % of GDP for 2016 which should be covered only with new parametric measures i.e. measures that are more easy to estimate such as increasing tax rates. The Greek government estimates a fiscal gap of 1.65 % but as a compromise we proposed measures, of a parametric kind to cover around 2% of GDP”.
Regarding the gap between the Greek calculation of 2% and the 2.5 % envisaged by the institutions “we argued that a reasonable compromise could include either the gap being filled with administrative measures of which we have already presented a comprehensive list of such measures amounting to 2.3 billion euro (for instance measures against tax evasion – afterall we were elected on a programme of fighting tax evasion) or by the institutions giving a bit of ground on their estimation of the fiscal gap. Of course we could have had a compromise based on a combination of the above two factors”.
According to Mr Tsakalotos the institutions refuse to allow any administrative measures to help close the fiscal gap on the grounds that they are uncertain and he stressed that “this is quite extraordinary since 500 million euros worth has already been collected from our new installments scheme for tax arrears”.
As far as the pension cuts are concerned, the Greek coordinator repeated that “the institutions insist that the parametric measures should incorporate a large sum from pension cuts – 1% of GDP. An extroardinary demand for a country in which pensions have been slashed over the last 5 years and 2/3 of pensioners have pensions below or close to the European poverty line”.
He also noted that “in Greece one pension often needs to serve a whole family given our 27% unemployment rate and over 60% youth unemployment rate”.
The message to the European leadership
“The Greek government has been struggling and will continue to struggle for a fair compromise. It is up to our European partners to decide whether, after six years of recession, the priority should be a strong reform programme to counter tax evasion, the power of the elites and the failings of the Greek public administration or yet more recessionary measures, yet more cuts in pensions and real wages. It is also time for a decision whether Europe can encompass a government and people that have set social and economic priorities somewhat different from the mainstream. It is thus time to see whether pluralism, fairness and democracy are still European values worth preserving”.