Greece’s crisis of epic retirement expectations 57



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We’ve all seen the queues of people photographed outside Greek banks worried their life savings are gone forever. We’ve heard the stories that people in Greece with be rationed to 60 Euros per day from local ATMs as the IMF deadline for Greek debt looms on Tuesday.

But have you heard the other part of the story… That one of the largest underpinnings of the Greek economic crisis is the country’s desire to stand up for its retirees and honour the retirement age of 61 that has stood for so long.

It seems this is one of the biggest sticking points for the Greek economic resolution, and stands as a much larger issue than the imposing of a few more taxes on the everyday people of Greece.

Imagine that… a country that sticks up for its retirees, and stands by its promises of not raising taxes of pensions unless forced. It seems silly to us outsiders who are used to having our budgets horse-traded on by our political parties. But to the Greeks, it seems the needs of the retirees that have been promised a pension should not be compromised.

The EU has spent the last few weeks imposing a list of demands on the Greeks as the terrifying final deadline for the economic bailout. There is a list of tax increases that takes more than a paragraph to share, reform of the labour markets and the setting of a new minimum wage, each of which have been spoken of as possible. And then there is the raising of the retirement age from 61 where it sits today, to 67, in line with Germany’s retirement age.

Greece’s creditors have consistently asked the cash-strapped country to eliminate the early retirement age of 61 and phase out solidarity grants for all pensioners. Finally,in the last week, Greece have offered to go part of the way… offering to raise the retirement age to 67… eventually. That is, there is clearly debate about how long they want to take to raise the age to this level.
Greek pensions are a fairly big deal, so are a significant part of the debate the IMF and Troika are having.

According to reports, the Greek side wants to increase pension contributions now and to phase in cuts over three years, starting Jan. 1, so that vested rights can be safeguarded, according to Greek newspaper To Vima.This would create pension savings worth 0.37% of gross domestic product for this year and 1.05% starting next year, according to the Greek proposal.
But in their initial proposal, the creditors had asked for pension reforms to be implemented on July 1, to save up to 0.5% of GDP this year and 1% next year. The creditors also sought to dismantle a solidarity grant for pensioners by December 2016.

Can you imagine your government fighting this hard to support your retirement pension if they were facing a gun barrel as big as Europe today?

Rebecca Wilson

Rebecca Wilson is the founder and publisher of Starts at Sixty. The daughter of two baby boomers, she has built the online community for over 60s by listening carefully to the issues and seeking out answers, insights and information for over 60s throughout Australia. Rebecca is an experienced marketer, a trained journalist and has a degree in politics. A mother of 3, she passionately facilitates and leads our over 60s community, bringing the community opinions, needs and interests to the fore and making Starts at Sixty a fun place to be.

  1. Australia take a long hard look— this is what will happen here if looney extreme left greens have their way. It’s never free!

  2. We are not in Greece and Australia is one of the richest countries in the world and our debt is one of the lowest

    2 REPLY
    • And we are that way because of the actions of the Labour Government that saw us get thru the GFC without feeling the financial pain that many other nations around the World felt and are still recovering from . . Most people living here still do not realise the financial pain the Labour Party saved them from . .

      1 REPLY
    • As a result of liberals savings both helped Australia out in GFC . Should be giving credit to both sides of government

      1 REPLY
      • nicely said, bipartisanship at a political or community level is dying or is already dead. No idea from one side is ever agreed to by the other without some stupid points scoring crappy sticking point devised to get a headline.
        Yes, I agreed with the Labor policies on the GFC, yes, the money was accumulated during the Liberal government, so what, it was not theirs, it was ours. Well done to both.
        The worst days work in our political history was the privatising of the Commonwealth bank. Well done Labor, cheered on by the Liberals who could not believe their luck. What crap is that !!
        The issue that is concerning me is the Trans Pacific Partnership, lets get some debate going on that subject. That will hurt us and our country like no other decision taken in my lifetime, it is surrendering our sovereignty to global big business, shame shame shame.

  3. There is more to this than pension age entitlemt. Pensions and public service entitlements in Greece are very generous too. Something has to give when you can’t borrow more and pay debts. Unfortunately our record is shaky too. The Howard government was too generous with tax cuts in good times and the Rudd/Gillard govts got sidetracked. But we can only change the future. Low debt doesn’t sanction more debt. Try paying your bills with credit cards and letting debt accumulate. You will soon be in trouble. People and governments must be responsible with debt and face the issue of appropriate living standards.

    2 REPLY
    • Ross I generally agree with you but I will point out the following. Howard gave tax cuts in good times because the country could afford it and it created incentives. He and Costello also put $60 billion in the future fund and created a $22 billion surplus but this rarely gets a mention. Labour was responsible for the 4 biggest deficits in history and the largest debt we have ever had. Sidetracked is hardly the right expression. Incompetence and ineptitude would be more accurate.

  4. Thecreal question in this issue is why are Germany and France holding the biggest debtbtomthe EU. It was created by them, for them and they as the richest two EU nations owe yhe IMF half of the total debt. When will they repay their heinous debt level?

  5. Of course they would. Just try to bring their pensions and perks in line with ordinary Australians and see how bloody hard they fight.

  6. One of the reasons Greece is in this mess is the corruption that has influenced spending. An example of this was clearly demonstrated in the letting of contracts to build their Olympic stadiums. Government officials gave the contacts to friends and family in some cases at almost four times real cost. It is tragic when the behaviour of Government has such damaging impacts on the people. A lesson for Australia where we see more decisions made to benefit the Murdochs, big miners and their ilk than the majority of the population.

  7. I was listening to my Greek neighbour who says it’s about time they raised the retirement age and he is scathing about how they want so many entitlements. He is the most hard working 60 yr old I know,so I hear what he says,but as far as we go,it’s a very different situation,as far as our wealth,population and taxpayers. Our government is busy trying to undo any benefits we are entitled to,so would they fight for us in those circumstances,well with their track record,I wouldn’t be putting them in to bat for me!

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