5th Aug 2021

Greece to vote on second set of reforms

  • Greek Parliament on the night of the referendum on 5 July, which rejected austerity (Photo: EUobserver)

The Greek government submitted new reforms to parliament on Tuesday (21 July), to be voted on Wednesday as part of the prior actions required by Greece's creditors to start negotiations on a new bailout.

The two new measures are the transposition of the 2014 EU directive on bank recovery and resolution (BRRD) and the adoption of the Code of Civil Procedure, which the 12 July euro summit statement said will "accelerate the judicial process and reduce costs".

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With the directive, shareholders and lenders will have to bail in banks in case of failure and deposits will be guaranteed up to €100,000.

According to the ANA-MPA news agency, a bill on permanent licenses for private TV stations and on the National Commission for Telecommunications and Post (EETT) could also be submitted to MPs.

The government removed two other reforms from the bill: the phasing-out of early retirement and a tax on farmers.

Both measures are disputed within Syriza, the left-wing party of Greek PM Alexis Tsipras. Thirty eight Syriza MPs voted against a first set of reforms on 15 July and Tsipras seems to have preferred not risking a new rebellion the second time around.

The tax on farmers is also controversial with the main opposition party, the conservative New Democracy, who helped the government pass the first bill on 15 July.


As also required by Greece's partners at the euro summit, the creditors institutions - the EU, the European Central Bank (ECB) and the International Monetary Fund (IMF) - "have been consulted" before the bill was sent to parliament, an EU official told EUobserver.

The institutions expect that "the legislation on early retirement and farmers will be adopted in the next package due in the first week of August," the source said.

In an opinion published Monday, the ECB "welcome[d] the draft law" but said "it does not opine on whether the draft law effectively discharges the obligations of the Greek State to implement the BRRD in Greek law".

"By requiring the ministry of finance's prior consent [on some specific decisions], the draft law seems to go beyond … the BRRD", the ECB said.


Meanwhile, preliminary talks between Greek authorities and the institutions have started at technical level to elaborate working methods for the bailout talks.

Greek media reported that representatives for the institutions are already in Athens, in a revival of the troika which the Greek government had pledged to keep out.

In a speech at a meeting of the World Hellenic Inter-parliamentary Association, the speaker of the Greek parliament, Zoe Konstantopoulou, called on the Greek diaspora to resist a "coup".

The euro summit agreement signed by Greece "challenges the democracy in our country, the free will of the Parliament, the freedom of conscience and expression of parliamentarians, their ability to discuss," said Konstantopoulou, a representative of Syriza's leftist hardliners.


For his part, Tsipras confronted his critics in an unofficial paper circulated by government sources on Tuesday evening.

"I read about heroic statements, but I have heard no alternative proposal towards the blackmailing dilemma of the 12th of July", Tsipras was quoted as saying.

"If some believe that an alternative leftist plan is Schaeuble’s [the German finance minister's] plan, or grabbing the stock of European Central Bank notes, or giving IOUs to pensioners, let them explain to the Greek people", Tsipras was quoted as saying in what appears as a first direct attack on his former finance minister, Yanis Varoufakis.

On Tuesday, the Standard & Poor's rating agency raised Greece's rating from CCC- to CCC+, where Greek bonds are still considered as "vulnerable to non-payment".

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