Germany will accept delay to pension cuts

The German government intends to support Athens’s demand not to implement planned cuts to Greek pensions issued before May 2016, thereby backing Alexis Tsipras’s administration ahead of national elections in Greece, according to sources cited by Bloomberg on Tuesday. The news agency speaks of an intention to delay the pension cuts rather than their cancellation – Berlin may be examining this possibility so it can overcome the anticipated domestic reaction to which Bloomberg refers.

Despite this German gift to Tsipras, the report notes that Athens’s difficulties are far from over, as a source familiar with the negotiations reckoned it is possible that ruling party deputies may block the disbursement of the European Central Bank’s earnings from Greek bond holdings in response to the failure to reduce Greek pensions.

This coincides with information Kathimerini obtained from Brussels last week regarding a delay in the payment of amounts concerning the Securities Markets Program (SMP) and the Agreement on Net Financial Assets (ANFA) to Athens due to the non-implementation of the reforms agreed – which would send a negative message to markets.