By Angelika Papamiltiadou

ATHENS (MNI) Some 2.5 million Greek public and private sector
employees are expected to go on strike Thursday to protest labor market
reforms and a pension reform bill tabled for final parliamentary vote
Thursday evening.

The overhaul of the pension system is part of the austerity package
launched by the government in May to reduce deficit to 3% of GDP by 2014
from 13.7% in 2009. The bill foresees a rise in the retirement age to
65, curbs on early retirement, especially for women, and cuts in
pensions benefits and allowances.

In May Greece signed a lending agreement with the EU, ECB and IMF
to receive a total of E110 billion on the condition of strict fiscal
consolidation of its public finances by 2014.

The pension reform bill is expected to pass with no problems, as
the ruling PASOK party has a seven-seat majority in Parliament. But
several party MPs have been expressing concerns about the severity of
the measures. Prime Minister George Papandreou has been pressuring his
party for no absentee votes, saying that the vote is crucial and the
party must appear united.

Several unions have announced they will protest certain measures in
the pension and labor bill, such as the elimination of the right to
arbitration in wrongful dismissal and the abolition of the collective
bargaining agreement, and appeal to court to render them
unconstitutional. They also say that the labor reform bill opens the
door to massive layoffs with a 40% cut in severance pay.

The protest is also aimed at changes in the labor market currently
being negotiated between the government and social partners. The
Socialist government has said it will push for a three-year salary
freeze in the private sector to accompany salaries cuts in the public
sector in an attempt to boost economic competitiveness.

The strike was announced by the two larger umbrella unions in the
public and private sector, GSEE and ADEDY. All public offices, schools,
tax offices, ministries, municipal and public services will be closed.
Hospitals will operate with emergency staff only. Ports are expected to
close and public transportation will be hamstrung.

Air traffic controllers will join the strike from 10:00 to 14:00,
arguing they have not been paid overtime since February. They have
scheduled their own 24-hour strike for July 24. Journalist will also
participate in the strike and there will be no news broadcasts Thursday
and no newspapers published Friday.

Olympic Air said it has cancelled 28 return flights to domestic
destinations and rescheduled 23 flights, including international
destinations such as London, Paris and Rome. Other airlines said they
have rescheduled flights to and from Greek airports.

Finance Minister George Papakonstantinou expects the recession this
year to be milder than previously forecast. “The first few months of the
year point to a moderate recession of 2.5% compared to our projection of
-4.0% for the full year, despite the very big reduction in public
consumption,” he said in a interview with a Greek magazine.

By contrast, EMU and IMF officials in their report released late
Tuesday said they had no evidence that the economy will recovery faster
than expected and thus no reason to revise their forecasts. They said
the recession was expected to unfold in the coming months.

EMU and IMF officials are expected to revisit Greece by the end of
the month for a formal evaluation, based on which they will decide
whether the country can receive the second loan installment of around E9
billion in September.

a_papamiltiadou@hotmail.com

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