Tuesday

5th Jul 2022

Greek 'truth' committee probes legality of EU bailouts

  • Soldiers outside the Vouli: Konstantopoulou said the probes could expose criminality at a 'very, very high level' (Photo: Barcex)

With Greek leaders in 11th-hour talks on the country’s second bailout, Greek MPs are investigating the legality of the bailouts and whether Greek debt has to be repaid.

A “truth” committee on public debt and a committee for the “memoranda”, the name of the documents which contain the bailout terms, were set up in March and April under the leadership of Zoe Konstantopoulou, the speaker of the Vouli, the Greek parliament.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

  • Konstantopoulou (c), with Sakorafa (l), and Belgian economist Toussaint on the debt truth committee

Their first findings are expected on 18 June.

The probes are complemented by a committee on German World War II reparations and on the return of Greek archeological treasures.

They are also complemented by the reopening, on 1 May, of the Siemens and Lagarde List cases by the Vouli’s committee on institutions and transparency.

The Siemens case involves bribes for Greek officials in exchange for public contracts for the German firm in the 1990s and in the run-up to the 2004 Athens Olympics.

The Lagarde List is a register of tax evaders transmitted to the Greek government by International Monetary Fund (IMF) chief Christine Lagarde in 2010, but never properly investigated.

The various initiatives are designed to delegitmise the austerity measures imposed by Greece’s creditors, the EU - the International Monetary Fund (IMF), and the European Central Bank (ECB) - since 2010.

They are being used as a “bargaining chip” in the bailout talks.

They’re designed to help Syriza heal tensions inside its own ranks, with radical MPs growing more critical of the PM’s, Alexis Tsipras’, concessions.

They are also designed to harm his political opponents, the conservative New Democracy (ND) and the socialist Pasok parties.

The old Greek elite, which has shared power since the country’s return to democracy in 1974, agreed the bailout terms and stands accused of shady relations with Greek oligarchs.

Political bomb

"Greece is not a liegeman whose lenders can play games behind its back," Tsipras said on 7 April, during the vote which set up the memoranda committee.

The memoranda probe could be the most explosive domestically.

It’s looking into the circumstances in which the Pasok government of George Papandreou and the ND-Pasok government of Lucas Papademos signed terms with the troika, a group of EU, IMF and ECB officials.

Konstantopoulou, the Vouli speaker, who used to be human rights lawyer, told EUobserver it could prompt criminal charges.

"The committee will look into possible criminal responsibility for the memoranda regime which has basically victimised the Greek population but also totally destroyed the Greek economy,” she said.

It’s composed of Syriza, ND and Pasok MPs and has already summoned witnesses from Greece’s Public Debt Management Agency, the General Accounting Office, and the Hellenic Statistical Authority.

Some MPs also want to interrogate former Greek finance ministers and international officials, such as former IMF chief Dominique Strauss-Kahn, former ECB president Jean-Claude Trichet, and former EU finance commissioner Olli Rehn.

Truth

The truth committee, despite its name and despite Konstantopoulou’s patronage, is not a formal parliamentary inquiry.

It’s an audit conducted by a group of some 30 experts from civil society, half of whom are Greek and half of whom are foreign.

The committee is comprised of professors of economy, legal experts, senior civil servants, including Belgian economist Eric Toussaint, who heads the international panel in the committee, and former Ecaduor Finance minister Diego Borja.

Ecuador, under president Rafael Correa, ran a similar audit before suspending international repayments in 2008.

"It’s very widely believed, justly believed, that a very big part of what is currently called the [Greek] public debt is illegitimate, illegal, and odious, and, of course, unsustainable”, Konstantopoulou said.

Her vocabulary refers to notions used by global anti-debt activists.

Campaigners say that: if debt harms public interest but favours a minority then it’s illegitimate; if it violates the debtor’s national laws, it’s illegal; that if it violates human rights, it’s odious; and if it can’t be repaid unless it harms fundamental rights, such as the right to healthcare, it’s unsustainable.

Timing

The full audit is to last at least a year.

But a preliminary report will be issued on 18 June, shortly before the end of the current bailout programme, when Tsipras is set to ask for debt restructuring and for new, long-term, assistance.

Patrick Saurin, a French trade unionist on the truth committee, told EUobserver “our work is to identify the four kinds of debt” in Greece.

"The government will quickly have a clear picture and will be able to decide on a debt moratorium or cancellation”.

It prompts the question whether Tsipras will follow Ecuador and use the “truth” report to also stop repayments.

"The government has a mandate to serve the people, so I’m sure it will make good use of the outcome of the works of the committee”, Konstantopoulou said.

Sofia Sakorafa, a Syriza MEP, who helped initiate the audit, told EUobserver it’s “a robust bargaining chip” in Tsipras’ negotiations.

"The committee aims to equip the Greek government with legal arguments on the issue of the removal of the debt”.

Moral high ground

Referring to the mixed bag of Vouli initiatives, Sakorafa added: "clearly, there is a political and moral link" between the probes.

Konstantopoulou said “auditing and decoding the debt [will] serve a fundamental and undeniable right of the people to truth and to justice”.

"It’s very important to … show which part [of the debt] corresponds to which lending agreement or [former] government actions, and to show which deals were concluded not for the public interest, but very often in order to serve corruption at a very, very high level”.

Is Greece about to default?

Greece just used emergency funds to pay the IMF and needs to find another €3bn by the end of May. But is it really on the edge of default?

MEPs boycott awards over controversial sponsorship

Two MEPs have withdrawn their nominations from the MEPs Awards over the Swiss pharmaceutical company Novartis's participation as a sponsor — currently involved in an alleged bribery scandal in Greece.

Opinion

The euro — who's next?

Bulgaria's target date for joining the eurozone, 1 January 2024, seems elusive. The collapse of Kiril Petkov's government, likely fresh elections, with populists trying to score cheap points against the 'diktat of the eurocrats', might well delay accession.

Stakeholders' Highlights

  1. Nordic Council of MinistersNordic and Canadian ministers join forces to combat harmful content online
  2. Nordic Council of MinistersNordic ministers write to EU about new food labelling
  3. Nordic Council of MinistersEmerging journalists from the Nordics and Canada report the facts of the climate crisis
  4. Council of the EUEU: new rules on corporate sustainability reporting
  5. Nordic Council of MinistersNordic ministers for culture: Protect Ukraine’s cultural heritage!
  6. Reuters InstituteDigital News Report 2022

Latest News

  1. ECB announces major green shift in corporate bond-buying
  2. Ex-Frontex chief 'uninvited' from parliament committee
  3. Czech presidency and key nuclear/gas vote This WEEK
  4. The human rights aspects of Grenoble's 'burkini' controversy
  5. Council must act on core of EU migration package
  6. Nato's Madrid summit — key takeaways
  7. Czech presidency to fortify EU embrace of Ukraine
  8. Covid-profiting super rich should fight hunger, says UN food chief

Join EUobserver

Support quality EU news

Join us