Athens: Greek finance minister Evangelos Venizelos pledged on Friday to pass austerity measures in parliament next week in a “fight for our existence", rallying lawmakers despite mounting opposition from labor unions and within the ruling party’s own ranks.

Much of Greece will be shut down by a 48 hour general strike called to coincide with the vote on Thursday. Union leaders hope to sink the package of pay cuts, tax hikes and public sector layoffs by undermining the resolve of the ruling PASOK party. At least two deputies have threatened to vote against part of the package. Nevertheless, the government’s slender majority will probably hold up.

A giant Euro symbol, the currency of the EU, stands in front of Frankfurt’s Eurotower, which houses the European Central Bank (ECB). Photo: AFP

Inspectors from the European Union (EU), International Monetary Fund (IMF) and the European Central Bank left Athens on Tuesday, indicating they would recommend releasing an €8 billion tranche of aid that Greece needs to keep paying its bills past mid-November.

But they warned that Greece, in deep recession and choking on a public debt equivalent to some 162% of gross domestic product (GDP), was slipping behind on its targets and needed to lift efforts to cut costs and reform its stricken economy.

Public anger at the measures has mounted however as ordinary Greeks have seen taxes go up, wages slashed and previously safe jobs in the public sector threatened with redundancy, in the most severe cuts in Greece’s postwar history.

Athens public transport services were shut down for a second day on Thursday, the finance ministry was blocked by striking officials, and taxi drivers, who fear their livelihoods will be threatened by measures to open up closed professions, planned to march on parliament.

Next week’s strike is expected to be one of the biggest since the crisis began two years ago, highlighting the threat that reform efforts could be undone by workers who refuse to implement cuts that will hit them directly.


Venizelos, who said he was working to build support among IMF members including new economic powers like Russia, India and China, said the wave of strikes could lead to a breakdown in order. “We must urgently come to our senses," he warned. “The general accounting office doesn’t work because it’s occupied, the general data system centre doesn’t work because it’s occupied... society is turning against itself," he said.

Papandreou’s Socialist government has seen its approval ratings drop sharply as the crisis has continued and there have been growing signs of revolt from within his own party with at least one deputy threatening to quit.

“I will resign on Monday, let somebody else take my place," PASOK deputy Thomas Robopoulos told a private radio station. “I can’t be part of a parliament in which I have nothing to say."

Two other PASOK deputies have said they will vote against a provision in the draft law which would suspend sectoral wage deals in certain sections of the economy until 2014 to boost company-level agreements.

The government has only a narrow majority with 154 seats in the 300 member parliament but would be able to replace any deputy who resigned with another member from its own ranks. A small centre-right party has also said it may support the government in Thursday’s vote.

Robopoulos, a car dealer and one of the few independent businessmen in the Greek parliament, has made several threats to resign in the past but has held back at the last minute to avoid triggering a government crisis.

However his comments underlined growing disillusion by many deputies in the ruling party, which has seen its position in parliament eroded by a steady trickle of desertions over the past year.

A total of six PASOK deputies have become independents in protest against austerity measures since the 2010 bailout. Another two resigned and were replaced by others from party lists.

The conservative opposition, which has repeatedly attacked the austerity measures as pointless and counterproductive, has called on the government to resign, but Venizelos said the criticisms would only make the ruling party more determined.

“I am sure this will steel the resolve of PASOK lawmakers," he told parliament.