Greece sets bailout revision agenda ahead of EU-IMF audit

Greece's new government on Saturday said it wanted to review several austerity measures enacted for rescue loans and bargain for a two-year fiscal adjustment extension as it prepared for an EU-IMF audit. A policy document released by the conservative-led coalition said efforts to "revise" Greece's EU-IMF bailout deal in talks with creditors starting Monday include "the extension of the fiscal adjustment by at least two years", to 2016. The aim would be to meet fiscal goals "without further cuts to salaries, pensions and public investment" and new taxes, it said, announcing a freeze on further civil-service layoffs, sales-tax cuts and longer unemployment benefits. "The aim is to avoid layoffs of permanent staff, but to economise a serious amount through non-salary operational costs and less bureaucracy," the three-party coalition document said. Under its loan agreement, Greece had promised to reduce the state payroll by 150,000 civil servants by 2015, including 15,000 this year. The new government said it also wanted to review minimum-wage cuts and measures taken earlier this year to facilitate private-sector layoffs, arguing that collective labour agreements would "return to the level defined by European social law" and what Europeans have agreed on. It said employers and unions should be allowed to set the private-sector minimum wage, which was cut by 22 percent to 586 euros ($736) in February amid additional austerity measures taken to clinch a new rescue deal. The blueprint is designed to reduce anger in Greece towards the austerity policies of the EU-IMF loan agreement, which are deemed to have deepened a recession now continuing for a fifth year. Over a quarter of Greece's workforce -- 1.12 million -- are jobless according to official figures. But Greece remains under intense international pressure to implement the terms of the EU-IMF bailout package that has kept the indebted country's economy afloat for two years. The eurozone's outgoing leader Jean-Claude Juncker this week said the creditors would simply be looking to "update" accords struck against 130 billion euros of loans -- plus a 107-billion-euro write-down of privately held debt. There have been indications that a target extension can be considered, but eurozone hardliners such as Germany and Austria are unlikely to accept a watering-down of Greek engagements. European Commission, IMF and European Central Bank inspectors return to Athens on Monday to resume discussions suspended because of Greece's two-month political deadlock, brought to an end by the elections on June 17. The appointment of Greece's new finance minister was delayed on Friday after the man chosen, Vassilis Rapanos, the 65-year-old chairman of leading lender National Bank, was hospitalised with stomach pains. Rapanos is expected to be released on Monday, news reports said. Newly-elected Prime Minister Antonis Samaras was also forced to cancel a parliamentary speech on Friday to undergo eye surgery for a retinal detachment. Samaras, 61, was expected to remain in hospital until Monday and his recovery pace will determine whether he can attend an EU summit on Thursday. In its first pronouncement, the new coalition government said last Thursday it planned to revise the EU-IMF loan bailout while safeguarding its place in the eurozone. The coalition is headed by the New Democracy party and backed by the Pasok socialists and the small Democratic Left party. It can count on 179 deputies in the 300-seat parliament. The new team has nevertheless pledged to honour Greece's targets on deficit reduction, debt control and structural reforms. "The goal is to create the conditions to take the country out of the crisis for good and out of dependence on loan agreements in the future," a statement said on Thursday.