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IPE special report May 2018

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Greece looks to Irish pension reform model

GREECE – The Greek government may turn to Ireland for “inspiration” on pension changes, a Finance and Economy Ministry spokeswoman has told IPE.

The government is watching the changes launched in the EU member states with similar life expectancy problems for inspiration, the spokeswoman said.

For the time being changes to the Greek system itself are not an issue, she stressed, but a committee of experts was set up a month ago to study how other EU countries tackle their pension problems.

“It is to get an idea. The research would only end up in a proposal,” she said. Economy and finance minister Giorgos Alogoskoufis last week said in a speech that the “dialogue about social insurance” should start this year.

Alogoskoufis, the spokeswoman explained, was talking about the new research group and not specifically of benefit cuts, a theme so far strongly opposed by the trade unions.

Italy, France, Austria are also being considered by the experts. Ireland, however, could turn out to be the source of inspiration for the committee, headed by a Greek economist the spokeswoman could not name.

Once the information is put together, the committee will draft a report for the social security ministry, which in turn will present it to the cabinet for discussion.

The committee, which is to concentrate on disability and old age benefits, has not been given a deadline for the report, although it will probably be ready in a few months.

Last week, National Bank of Greece chairman Takis Arapoglou called for a “more rational approach to matters such as pensions and social security”.

At the same time the Foundation for Economic and Industrial Research – which is sponsored by the Federation of Greek Industry - was reported as saying that state pensions expenditure will cost 24.8% of GDP in 2050 if things continue unaltered.

“The government is willing to refresh the reform process of social insurance schemes, emphasizing on statutory old age pensions, supplementary benefits for civil servants and pension funds,” Gabriel Amitsis, head of the Institute for Social Innovation, said.

He also said it was supposed to become “a hot issue” after April.

The Greek pension system consists of several primary insurance organisations, including the public sector IKA-ETAM and auxiliary pension funds for some professions. The concept of voluntary employer-sponsored pension fund was introduced in 2002.

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