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ATHENS – Greece’s Finance Ministry almost didn’t have enough money to pay pensions and salaries this month, scraping together spare cash at the last moment but not before setting off a mild panic among beneficiaries who had to wait some hours to see if they would get the money.

Locked in stalled talks with international lenders, Greece is fast running out of cash and had to order cities and towns and state enterprises to hand over all their money so the coalition government can meet its obligations.

The troika of the European Union-International Monetary Fund-European Central Bank (EU-IMF-ECB) is holding back a 7.2-billion euro installment until Prime Minister and Radical Left SYRIZA leader Alexis Tsipras imposes more of the tough reforms he vowed to reject, a platform that got him elected in Jan. 25 snap elections.

He has said he would pay pensions and salaries first, even if it meant default, a prospect which has rattled the Eurozone and set off fears of a default.

The newspaper Kathimerini said that the pensions of the state funds and the Social Security Foundation (IKA) were paid out at the very last minute this week.

While Alternate Social Security Minister Dimitris Stratoulis attributed the delay to a technical problem, saying the interbank system had been unable to immediately update the pensioners’ bank accounts, the newspaper said the real reason was that the government couldn’t find enough money to pay them.

Although pay day for state and IKA pensions was officially April 29 but many recipients had rushed to ATMs the evening before as for many their pensions are usually deposited the day before.

When they saw their accounts weren’t credited it set off anxiety the government would withhold pensions and salaries and was broke.

Without referring to any technical issues, the Hellenic Bank Association issued a statement late on April 28 saying that the crediting of pensions to the recipients’ accounts would be completed by 11 p.m. but they weren’t done so until the next day.

Stratoulis was also in contact with the President of National Bank and the HBA, Louka Katseli, who assured the minister that the problem had been resolved.

The system does not allow for any withdrawals unless all pensions have been deposited and the banks have conducted their inspections and the government had to look under rocks to come up with the money, and without getting more aid may not be able to make the May payments at the end of the month.

Elderly Athenians waited at branches of the National Bank of Greece, the state-controlled lender handling the bulk of pension payments, which are staggered over

“Normally I only withdraw half the money at the end of the month but today I’m taking it all,” Sotiria Zlatini, a 75-year-old former civil servant told The Guardian. “There are so many rumors going round because of the government’s problems and what happened two days ago.”

Fears of a default have also led bank depositors to take out more than 28 billion euros in the last six months and banks have seen their assets shrink 20 percent to 134 billion euros.

“I went to the ATM in the morning before going to the supermarket but the money wasn’t there . . . I went back at eight in the evening feeling quite anxious but it had arrived,” Socrates Kambitoglou, a retired civil engineer, told The Guardian.

Another official said inflows of €500m on April 29 had provided enough money to pay the pensions and another 300 million euros came in on April 30.

 

The post At Last Minute, Greece Scraped Pension Payments Together appeared first on The National Herald.

Source: The National Herald
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