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Greece Passes ‘Tough’ 2016 Austerity Budget

Greek lawmakers approved a “tough” 2016 budget early Sunday, forecasting near zero growth for 2015 and a small contraction next year for the debt-ridden country in its sixth year of austerity.

The coalition government, which enjoys a narrow majority, managed to push the budget through with 153 votes for and 145 against after a late-night session.

The leftist government of Alexis Tsipras (pictured) is trying to apply the terms of an unpopular third EU economic bailout, enacted in July in return for safeguarding the country’s place in the eurozone by restructuring its economy.

“Nobody can cheer for this tough budget”, Greek Finance Minister Euclid Tsakalotos said late on Saturday during the tumultuous parliamentary discussion.

The 2016 budget, the first by the leftist Syriza-led government, expects zero economic growth in 2015 — better than an October forecast of a 2.3-percent contraction.

For 2016, it projects a 0.7-per cent contraction, again better than the initial 1.3 per cent forecast in the draft budget.

“Behind the (budget’s) numbers anybody can see the agonising effort to support the working classes” Tsipras said early Sunday, describing the budget as “a difficult exercise”.

The Greek government has already seen its parliamentary majority dwindle from 155 to 153 seats in its effort to implement the tough measures imposed by its creditors.

Measures facilitating foreclosures against people who cannot pay their mortgages led to the loss of support from two lawmakers who refused to back the bill.

Plans to slash the minimum monthly pension have caused two general strikes in a month, a sign that Tsipras faces a rough ride despite being reelected in September on the bailout programme.

After first storming to power at the beginning of this year promising to free Greece from the restrictions of bailout programmes, Tsipras in July accepted a three-year, 86-billion-euro ($93-billion) rescue deal with strict conditions to enact further cutbacks.

As part of the agreement, Greece is set to introduce new pension cuts next to keep its shaky retirement system viable.

“They are getting ready to turn the pensions into tips”, interim head of the New Democracy right-wing main opposition party Yiannis Plakiotakis said on Saturday.

He added that the budget is “anti-growth” and “socially unfair”.

 

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