Greece reforms to unlock loans

After one day of debate, the Greek government has passed a series of provisions covering 110 pages of legislation in just one article.

The legislation was a condition for further international aid instalments agreed with the European Union (EU) and International Monetary Fund (IMF). It passed easily on Sunday with the support of the three parties making up Greece's ruling coalition, by 168 to 123 votes. It unlocks about 8.8 billion euros ($11.48 billion) of rescue loans from the EU and IMF.

The legislation makes it easier to fire government employees for disciplinary reasons, extends an unpopular property tax and opens up professions such as accountancy. Measures to cut Greece's budget deficit and make its economy competitive are a condition of its 240 billion-euro bailout.

The new law will allow for the first civil service layoffs in more than a century. About 2,000 government employees will be laid off by the end of May, with another 2,000 following by the end of the year and a further 11,500 by the end of 2014, for a total of 15,500.

It is a major sea-change for Greece's protected government workers. The permanence of civil servant jobs has been enshrined in all constitutions since 1911, to prevent them being sacked when the government changes hands. The new law circumvented the protection by stipulating that the first layoffs would take place in state agencies that are to be disbanded or merged. The civil servants' union, ADEDY, opposed the bill.

The law contains many unrelated provisions, from the payment of back taxes and social security contributions to the end of bakeries' monopoly in baking bread.

Finance Minister Yannis Stournaras said eurozone officials will meet on Monday to approve overdue payment of 2.8 billion euros in rescue loans and again on May 13 to release a further 6 billion-euro instalment, he added.

jm/ch (Reuters, AP)