Under the heading of "They stole my money", the Ekathimerini reported about 4 cases of pensioners who feel that they have been 'destroyed' by the various pension cuts of the last 7 years. There is no question that a very large number of Greeks have ridiculously low pensions (below 500 Euros!) but if the average Greek pension is almost as high as the average German pension, as the IMF states, that can only be explained by a high number of pensions significantly above the average and/or by a high number of pensioners who do not fullfil today's pension criteria.
My understanding is that the 'reformed' pension criteria are now: ordinary retirement age 65 and minimum contribution years 40. Also, the survivor's pension is 50% of the original pension. I would guess that those are rather standard criteria in today's Europe.
One should review the 4 cases in the above article with a focus on the following questions:
1) At what age did the person retire?
2) How many years did the person work/contribute?
3) In the case of survivor's pensions, how high would the original pension have been?
When one reviews the 4 cases with the above questions in mind, one would come to the conclusion that there have indeed been drastic reductions but when looking at these 4 pensions as they now are after allegedly 13 pension cuts, one can only conclude that perhaps the Ekathimerini did not chose the best examples of how much many pensioners are suffering today.
The following 2 statistics about Greece's approximately 2,6 million pensioners also merit consideration:
* 633 thousand pensioners (24% of the total) are over the age of 81 and their average monthly pension is 712 Euros (compared with average Greek pensions of 890 Euros).
* 727 thousand pensioners (28% of the total) are below the age of 65 and their average monthly pension is 1.028 Euros. Put differently, pensioners below the new legal age of 65 account for almost one-third of the entire pension expense.
My understanding is that the 'reformed' pension criteria are now: ordinary retirement age 65 and minimum contribution years 40. Also, the survivor's pension is 50% of the original pension. I would guess that those are rather standard criteria in today's Europe.
One should review the 4 cases in the above article with a focus on the following questions:
1) At what age did the person retire?
2) How many years did the person work/contribute?
3) In the case of survivor's pensions, how high would the original pension have been?
When one reviews the 4 cases with the above questions in mind, one would come to the conclusion that there have indeed been drastic reductions but when looking at these 4 pensions as they now are after allegedly 13 pension cuts, one can only conclude that perhaps the Ekathimerini did not chose the best examples of how much many pensioners are suffering today.
The following 2 statistics about Greece's approximately 2,6 million pensioners also merit consideration:
* 633 thousand pensioners (24% of the total) are over the age of 81 and their average monthly pension is 712 Euros (compared with average Greek pensions of 890 Euros).
* 727 thousand pensioners (28% of the total) are below the age of 65 and their average monthly pension is 1.028 Euros. Put differently, pensioners below the new legal age of 65 account for almost one-third of the entire pension expense.
Generally speaking I don't think one can live on a Greek pension alone. Most people have supplemental income such as rents they collect from real estate owned.
ReplyDeleteFrom my own experience in dealing with the Greek system on behalf of my mother who past away last January, the system in Greece treats you as guilty unless proven innocent whereas in the US the other way around. In the US the minute you declare you are a survivor widow your pension is upgraded on the spot to match the higer of yours or spouses's pesion and you receive the monthly amount by the 4th of each month retroactively. In Greece when my mother lost her husband in March 2014 it took until the month of March 2015 for her to receive her pension (it was a lump sum distribution to account for the 12 month delay). How is a person who lost a husband to live with own funds for a year is something hard to understand. Especially for those who have no savings and need to money to simply survive. My mother's case was not a case of need but the question is how did the government know about who has the need and who doesn't. Delaying payments to pensioners is not something you expect your state to do, hence the suspicion most Greeks have towards their government and the "what's in it for me" general attitude towards public obligations.
In the last years, I have been able to observe how my neighbor and best friend here has been battling the processing of his pension. Since he had been unemployed for a number of years, he was eagerly waiting for his pension. Well, it took months until he received as much as a confirmation that he was eligible for a pension. Of late (at least 1-1/2 years after his eligibility date) he started receiving payments not as actual pensions but, instead, as advance payments which will eventually be settled with his pension. He is not ruling out the possibility that he may have to give some of these advances back again.
DeleteI could also observe how he battled the process of the inheritance he and his sister made. My neighbor is one of those super-correct Greeks. I will never forget the day when he told me in a totally ashamed fashion: "Today, for the first time in my life, I had to give in. I had to authorize my lawyer to make 'payments' where necessary because otherwise we would not have had any chance to complete the matter in the next few years".
You could take this to all areas of public administration. The issue with the land registry is simply inconceivable for someone from Central Europe. The unsettled law suits. Etc.
You can have all the primary and current account surpluses in the world. If a country cannot efficiently administrate its affairs, if the public administration doesn't work well, if the institutions are not strong, if the state of law is not almighty - well, then you are up against a very steep hill. That's why I had so many hopes for the EU Task Force for Greece. After it was abolished in mid-2015, it was replaced by a French project. Hollande even came to Athens to sign the deal. That's the last thing I ever heard about that.
The best way to live as a pensioner in Greece is to receive your pension from another country. The less you have to deal with the Greek state the more your Happiness Index score.
DeleteNever heard of the French project. The next big thing that is happening in Greece is the evaluation of the public sector. Already some forms are distributed to all public employees which are supposed to be completed and submitted back to the state by the 3rd week of June. Then the state will determine the qualifications, transfers if necessary or firings. We are talking real fireworks because the dead wood in public administration is notorious. We used to have 900,000 public employees in Greece reduced down to 600,000 via early retirements and I believe about 30%-40% of this remainder are unqualified and therefore redundant. Talking about high drama for the months to come. The hideout of Syriza voters will be attacked and cleansed if we are lucky enough to cleanse it that is.
DeleteThere is a link in the below article to the French-Greek agreement. I remember there was a lot of media attention at the time but since then it has been very quiet.
Deletehttp://klauskastner.blogspot.gr/2015/10/france-will-modernize-greece.html
Btw, the problem with the Greek pension system is not so much the ridiculously low monthly payments which of course are not satisfactory by any metric. The real problem is the rapid greying of the population which has transformed Greece into a country of old people. The young can't find work so they leave or stay unemployed which means that there is no replenishment of the necessary funds to keep the social security system alive.
ReplyDeleteSo the real catastrophy would be when a rapidly depleted social security system can't even pay the extremely low pensions which the pensioners take for granted and make life plans around these meager amounts given to them but not certainly guaranteed.
Potentially a very big time bomb down the road.
Kleingut:
ReplyDeleteYour favorite guy Georgiou is in the crosshairs again:
"A new lawsuit is in progress at the expense of former ELSTAT chief Andreas Georgiou, who was dismissed for the second time last Friday by a hearing by the Athens Court of Appeal for a fake assertion that he expanded the deficit in 2009 by facilitating the imposition of fiscal adjustment measures (Memoranda).
The former head of ELSTAT is being tried in second instance at the Court of Appeal following the appeal by the Public Prosecutor for his acquittal at first instance for the charge of breaching a duty consisting of remaining for three months at the same time as head of ELSTAT and a member of the International Monetary Fund In which he offered his services for years and that he did not summon the ELSTAT board of directors, in any case, issues that did not concern the enlargement of the deficit.
However, in his trial that began at the Court of Appeal and was interrupted for July 18, two former members of the ELSTAT administration Nick. Logothetis and Zoe Georgantas have long testified that Mr. Georgiou is responsible for the expansion of the deficit in 2009 and has the full responsibility for the country's affiliation to the memorandums."
http://news.in.gr/greece/article/?aid=1500146640
I have lost track. I thought he was just now cleared of all charges. How can he be tried again?
DeleteArguably the new MOU protects Georgiou but if there is no debt relief delivery then the whole agreement is out the window.
DeleteKleingut:
ReplyDeleteThis is worth devoting a new blog entry. It's about perhaps the most important reform in fixing the public sector. The legislation is known as Law 4369.
https://www.eurofound.europa.eu/observatories/eurwork/articles/working-conditions-labour-market-industrial-relations-law-and-regulation/greece-the-third-memorandums-plans-for-public-administration
Yes, July 2015 were the days when things were moving. The Troika became the Quadriga, memorandums became programs and TFGR became Structural Reform Support Service. I remember thinking of di Lampedusa's "if we want things to stay as they are, things will have to (appear to) change.
ReplyDeletePS. France was also domain leader for central administration reform under TFGR, and that was one of the areas where absolutely nothing happened. The beer is on me if it does this time.
Lennard
O.k. as long as it is Greek beer from Northern Greece.
DeleteBtw, it does not look that anything will happen because Trsipras has publicly said that if Berlin and IMF don't get their act together in delivering debt relief then zero of what has been agreed would be implemented.
How about this as a definite statement?
ReplyDeleteDonald J. Trump @realDonaldTrump
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We have a MASSIVE trade deficit with Germany, plus they pay FAR LESS than they should on NATO & military. Very bad for U.S. This will change.
Cutting pensions is o.k. according to a dispassionate postion. I am o.k. with it:
ReplyDeletehttps://www.eurofound.europa.eu/observatories/eurwork/articles/greece-latest-working-life-developments-q1-2017
Security in Brussels – A Case Study for Europe
ReplyDeleteIn no other European city is the perception of the threat from terrorism stronger than in Brussels, not because Brussels has witnessed more terrorist attacks but because of the high presence of military forces. Special operations forces and military personnel are visible in other Western capitals like Paris and Berlin as well. They were deployed after terrorist attacks were carried out in these cities, and even after a state of emergency was lifted, military forces remained deployed in most capitals.
But in many countries, military forces are usually accompanied by domestic security forces. In Brussels, these reinforcements are lacking and the military is virtually the only force ensuring civilian safety. This is because domestic security is weak in Belgium. Some might question the efficiency of fighting terrorism this way, using military forces to patrol civilian areas, but the military presence is used as a deterrent and is intended to prevent another attack from taking place. It is also, however, a constant reminder of the terrorist threat. This is one of the goals of terrorism – to create the fear that an attack can happen at any time and in any place. And it is unclear if the presence of military personnel actually limits or contributes to this fear.
The military’s effectiveness in combating potential terrorist threats in Brussels is also questionable because soldiers carry limited weaponry and are not allowed to go beyond the perimeter to which they’re assigned. If they see a threat outside of their area, they have to call domestic security forces. To make things worse, there is also limited cooperation and intelligence sharing between the military and domestic security forces. In Belgium, there is a lack of confidence in the domestic security forces, and many hope that the military will break these rules and jump to the rescue during an emergency situation.
This tension between the military and domestic security forces is common to all NATO member states. Alliance members share some intelligence between their defense departments, but they don’t share any information at the domestic security level. And it’s likely to stay this way, partly because of member states’ resistance to sharing intelligence at a more advanced level than they do now and partly because adding another layer of decision-making might actually slow things down. Fighting terrorism at home has become the top security priority for most NATO members and is more efficiently done at the national level.
NATO can do little to help improve security in Brussels or elsewhere in Europe. But it can issue a press release saying it wants to do more to fight terrorism. Such claims have been made before. NATO places terrorism in the same category of threats as propaganda and cyberwarfare, and it has established research centers to study these so-called hybrid threats. It has also discussed joining EU forces in combating these new challenges. But this will amount to little more than bureaucrats holding meetings, while little is done to actually prevent more attacks.
Bureaucrats at NATO as well as the EU know the reality. They complain about the restrictions they face and the lack of action from politicians. But politicians have their own limitations – most importantly, their electorates. Above all, NATO leaders don’t want to admit that the alliance is ineffective and would rather NATO remain in its current hopeless state. So would the bureaucrats who work there, since their jobs depend on it. This might seem like an absurd situation, but in politics, absurdity is a substitute for dealing with a reality that can cause great damage if it is acknowledged.
By Antonia Colebasanu.
And as we know, what Tsipras says always comes through.
ReplyDeleteLennard
Tsipras is only the tip of the iceberg. Gear what Dan Hannan has to say:
Deletehttps://www.youtube.com/watch?v=GuEHaEf985A&feature=push-u&attr_tag=Ddn6wg_XR-3ICSHT-6
I have advocated to FIX Hellas before, nobody does.
ReplyDeleteLennard
For I moment I thought you were advocating the Greek FIX beer.
DeleteAnd as we know, what Trump says always comes through.
ReplyDeleteLennard
But then we have statistics and we know German sales to the US are less than in 2016. We will keep you posted but I think Trump is reinforcing a trend that is already happening.
DeleteI don't think so. If Greek shipowners have any smarts then they will staty away from the Berlin tax prison called Greece.
ReplyDeletehttps://www.bloomberg.com/news/articles/2017-05-30/greece-seeks-to-lure-u-k-based-shipowners-brokers-on-brexit