No funds
The government has employed all sorts of tricks in tackling the social security issue in an attempt, on one hand, to avert a repetition of last year’s hue and cry when it tried to resolve the issue and, on the other, to veil a fundamental weakness that essentially renders any serious reform unfeasible. Despite governmental triumphalism regarding a powerful Greece, people in the know are aware that the country’s eurozone entry was not accompanied by any substantial restructuring of the economy. Moreover, the surplus budget was more a product of creative accounting than the genuine prosperity suggested by financial figures. However, the implementation, for example, of a merger between the approximately 200 social security funds by 2008 (a move which was announced six years ago but never actually promoted) presupposes that there are adequate state funds to secure a smooth transition. Lacking the requisite funds, the government is now planning to recycle the money which has been accumulated by, for example, civil servants’ contributions or farmers’ contributions to the Farmers Pension Fund (OGA) after the restructuring which began in 1993 and 1998 respectively, invest it in the broader social security system, and finally to portray it as new funds. Similar tricks regarding savings in various sectors complete the picture of the largely imaginary sums that the government supposedly aims to channel in order to solve the social security issue. Such machinations may well throw citizens into confusion or even mislead them, but in no way will they ensure a serious reform – let alone a viable solution to the social security issue. These machinations allow the government to be demagogic and foster the illusion amid the insured that they have escaped the worst, at a time when the current system is unviable and pensions remain at unacceptably low levels. Some 65 percent of pensioners receive less than 380 euros (130,000 drachmas) per month, while the average pension is 460 euros (157,000 drachmas) a month and only 7 percent of the entitled have a monthly pension above 880 euros (300,000 drachmas), which even then can hardly ensure a decent life. The government’s attempt to mislead citizens is a far cry from the much-touted modernist reforms. A recent IMF report characterizes Greece’s social security system as being too fragmented, too complicated, and subject to abuse. Is the government planning to do anything about this?
