Greek public sector cutbacks trigger strike

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Associated Press

Posted on December 19, 2012 at 4:34 AM

Updated Wednesday, Dec 19 at 6:07 AM

ATHENS, Greece (AP) — Civil servants in Greece staged a 24-hour strike Wednesday, as thousands gathered to protest new pay cuts as well as suspensions that are expected to lead to layoffs.

The strike led to public transport stoppages in Athens, while public hospitals were running on emergency staff, and other public services were disrupted.

Greece has promised its bailout creditors more steep spending cuts despite a deep recession that is heading into a sixth year.

Nikos Stamatopoulos, leader of the Athens subway workers' union, said a skilled maintenance employee with 20 years of experience at state-run transport services has seen his monthly salary cut from pre-crisis levels of €1,700 ($2,240) to €800 ($1,050) next year.

"We can no longer live on what we earn, so what's the point?" he said, as protesters gathered for a march to parliament. "We'll keep fighting these (cuts) because we have to."

The protesters, displaying their union's official color orange on caps and flags, chanted anti-government slogans. One group of marchers held up a mock clothes line with the words "Take These Too" written across 16 pairs of underpants.

Greece's largest labor union, the GSEE, which also covers the private sector, joined the strike with a three-hour work stoppage, while many individual unions plan to continue strikes Thursday.

Under a new staff reduction scheme, some 27,000 public servants will be suspended in 2012-13 on reduced pay for a year pending their transfer or dismissal.

"They call it suspension. But we know this means firing people," said Themis Balasopoulos, leader of the local government workers' union.

Most Greek public servants have strong legal job guarantees, in contrast to the private sector, which has seen huge job losses that have helped push the national unemployment rate above 26 percent.

The new pay cuts, starting Jan. 1, will be generated by merging categories of public servants. That will effectively reduce the number of pay grades, stripping many employees of financial benefits.

Since May 2010, the country has survived on billions in rescue loans from the other 16 eurozone countries and the International Monetary Fund. In return, it raised taxes and slashed wages and benefits, driving hundreds of thousands into poverty.

Last week, the government bought back a large slice of its debt held by private sector investors, scratching some €20 billion ($26.4 billion) off the national debt.

The ratings agency Standard & Poor's on Tuesday upgraded Greece's credit grade by 6 notches, from default to the B- junk rating.

The action spurred a bank-led rally on the Athens Stock Exchange Wednesday, with shares up nearly 3 percent at 862.88 in afternoon trading.

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