European Trade Union Institute, ETUI.

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29 January 2018

Greece: new reform programme leads to fresh protests

Austerity policies have had a massive impact on the Greek labour market. The first assistance programme which began in 2010, and the so-called European Stability Mechanism (ESM) stability support programme which was signed in August 2015 in a Memorandum of Understanding and implemented up to July 2017. In the autumn of 2017, the assessment started with a view of entering a final stage. The trade unions reacted very critically and rejected proposals for further cuts.

In April 2010 Greece requested financial assistance from its European and international partners. In May 2010, the Greek authorities signed a financial assistance programme with the European partners with a financial envelope of 80 billion euro, as well as a standby arrangement of up to 30 billion euro from the International Monetary Fund (IMF). In the following years, the country concluded an agreement for stability support in the form of a loan from the European Stability Mechanism (ESM) in August 2015.


The Memorandum of Understanding (MoU) signed by Greece and the European Commission on behalf

of the ESM, detailed the conditionality attached to the financial assistance facility. The financial assistance was accompanied by measures to restructure the public and private sector debt. Compared to the earliest assistance, more explicit references was made to the Charter of Fundamental Rights as well as to social cohesion, growth and employment, including active labour market policies. Since this programme was launched in August 2015, two reviews have been completed.


Against the background of a global recovery, the donor organisations are now more optimistic about the country’s perspectives, for instance, for 2018 growth is expected up to 2½%. However, unemployment is still very high and the purchase power of citizens has fallen dramatically. The major pension reforms that were enacted in 2015 and 2016, aimed at ensuring the sustainability of the pensions system and enhancing inter-generational fairness, but above all generating savings of GDP in the near future. Reforms included an increase of the retirement age, the elimination of early retirement, the merger of all pensions funds in one fund and a significant reduction in pension entitlements of new retirees. The international bailout programme is due to end in August 2018, and the country has agreed to continue cutting wages and pensions when external funding comes to an end. Athens will need to implement a broad set of reforms as part of this so-called third review of its bailout program.


On Thursday 14 December 2017 workers marched through their cities to protest against another round of proposed reforms. The unions want to see an end to pay freezes, steps towards decent pay and no reduction in tax allowances. They reject plans for further cuts to pensions and call for the creation of permanent jobs to deal with staffing shortages across the public services. According to the unions, these reforms are not going to help workers and poor citizens. The bailout programme has left workers, pensioners and socially vulnerable people in a dire situation and it is not going to take the country out of the path that the troika imposed almost 8 years ago.

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