ATHENS: Greece and her creditors are locked in another stand-off, after the country’s unpredictable Prime Minister Alexis Tsipras stood his ground on a “pre-Christmas bonus” for pensioners.
In a surprise announcement last week the leftist leader said the government would pay out €617m (£518m) to retirees who, after a series of cutbacks and tax rises, are living on less than €800 (£675) a week, says The Guardian.
That wasn’t all. Tsipras also announced that “Greeks living on Aegean isles which have borne the brunt of refugee flows would not be subject to a sales tax enforced at the behest of creditors keeping the debt-stricken country afloat”.
Finally, in an “antagonising and pointed” flourish, he said he would introduce free school meals for children living in some of Greece’s poorest regions in the north of the country.
The government insists it has the right to spend the money, without seeking permission, because it generated a surplus of €7.4bn (£6.25bn) for the year to November, which the Wall Street Journal says beat its target by €4bn (£3.4bn).
“We will adhere to the [bailout] program to the letter, but whatever outperformance in revenue arises by following to the program, we will not ask anyone in order to give this money to those most in need,” Tsipras said.
Creditors disagree. They perceive the handouts as being in contravention of the terms of their bailout – the third in six years – which requires substantial reforms in taxation and pensions.
