The Stability and Development Programme: pre-agenda discussion in the House | Prime Minister’s speech

Athens, March 22, 2010

Members of the House, it is not necessary for me to describe the dramatic moments Greece has been through these past months, for two reasons:

Firstly, our country finds itself with the largest deficit in its recent history; a budget deficit and an unprecedented debt; a deficit in our credibility as a state and a deficit even in terms of prospects and hope for the future, both of our economy, our family prosperity, our pensions, our jobs and of our enterprises.

The second reason for Greece’s tribulations is the international context and the world economy; an economy shaken by the recent fiscal and financial crisis, where the whole world stands helpless before the phenomena of over-concentrated power and wealth, as well as the uncontrolled, opaque functioning of the markets, of banks and parallel shadow mechanisms such as hedge funds.

Democratic states, governments, parliaments and audit authorities have found themselves faced with painful surprises and practices which have concealed the real situation within the financial sector.

Despite the rescue measures implemented by other economies through support packages and aid to the banking system to avoid their economies moving into deeper recession, societies have, even so, been severely affected, workers have been hit with increased unemployment and deterioration in living standards and in many cases even lost their pension rights.  Many are still feeling the effects in a number of countries even today.

Through a combination of a credibility gap and the seriously perturbed situation on international markets, as well as the political front in many countries, it has been easy to point the finger of blame at Greece, as the black sheep, the guinea-pig, in this new phase in the international crisis.

Unfortunately, some politicians and representatives of the media have toyed with populist politics and the prejudices of their voting populace to make Greece the scapegoat for the woes of others.  We have seen this happen, have felt the blow even though we did not deserve it, nor do we deserve it today – that we are sure of.

However this situation cannot be reversed, either by beseeching, or incantations, or condemnation, or even of course by inaction or fear of political fallout, which often characterizes the Greek political system.  In order to be convincing, it has been imperative for us to take decisions which were difficult but which would rectify this negative image and position our country we are in and to open up new prospects for our nation.

This is precisely what we have done.  The first battle was to restore our credibility as a country.  We had to convince others that the Greeks understand and assume their responsibilities and are able to put order in our own house.  We need to prove that we are not afraid to enter the battle nor do we shy away from pain.   We do not default on our obligations and we are proud to undertake our responsibilities to steer our country out of this incredible mishap.

We have won the first battle.  Today we have implemented an emergency package of measures which has convinced even the most disbelieving partners in the European Union as well as worldwide.  We have demonstrated our decisiveness today as well as our volition to change things.

We have regained our credibility in everybody’s eyes, this you can see and hear.  No longer is Greece being singled out as the black sheep.

Precisely because today and in the forthcoming days, and even this evening we are being watched very closely by the world media, I would like to repeat that Greece is doing and will be doing precisely what it has said it would.

I was asked whether our programme would come before the Hellenic Parliament for a vote and there was positive surprise at our volition and speed of action.  This is yet another sign of our decisiveness and credibility as a nation.

Greece is not the problem today.  We are a credible nation which can and does face up responsibly to its difficulties and problems.  This is what Greece is and the Greece we serve.

The second battle relates to the European Union, but also the international markets and the support we need, not in order to avoid making changes, not to dodge our responsibilities, but precisely to make these major changes which our country needs.  This is why we are seeking support.  We are not talking about a bail-out.  What we need is to have the calm and stability we need for a substantial period so that we might move ahead unimpeded and without further, unjustified burden to take these major steps for our country.

I can assure you that the Greek people will pull through by its own strength.  We are not, nor would the Greek people ever accept being mendicants; this is not in our psychological make-up, nor does it characterise us as Greeks.  I have stated any number of times that we have not asked for money.

I might take this opportunity to say that we have even heard wildly unrealistic scenarios of our country exiting the Eurozone.  This is a complete farce.  Such scenarios can only but arouse ire.  I want to assure Greek citizens once again that with the measures we are taking our country will pull through.

Let there be absolutely no doubt.  Greece will pull through!

We will put things right but it would be very useful for it to be obvious that the European Union has a powerful weapon, which is loaded, on the table, able to deter any speculation or speculators; this is something that is beyond our capability or the strength of an economy the size of Greece’s economy.

In this battle we have many allies.  There are those who recognise that international markets need rules and regulations, and those who want Europe and the Eurozone to play an enhanced role of stability and development.

Without knowing the final outcome of the next few days one this is sure:  because of Greece and our initiatives, because of our systematic and often exhausting course over the past few months, but with the help of the European Commission and the European Central Bank and the European Parliament, the European Union has already taken substantial steps; in fact given the norm for the European Union, very quick steps.

Without exception everybody recognises the prospects and usefulness of the new institutional tools for stability in the Eurozone, whether it is called a ‘European Monetary Fund’ or ‘Eurobonds’, or ‘guarantees’ for loans and so on.

I would like to inform all of you, as well as the Party Leaders that I will keep you informed about decisions taken over the next few days in the European Union and of course decisions we will be taking shortly.

But the battle is not over.  After the decisions we take this week we will move into a second phase of the battle – and here I am seeking the broadest possible collaboration from you all.   I mean of all the parties.  Since you, Mr. Tsipras raised the issue of the lack of consultation before taking measures my reply is that when we had a bilateral meeting together, just as with the other party leaders I did not even present you with the dilemma of supporting the specific measures. I would not have expected you to say that you wanted to reduce salaries, to increase VAT, to reduce benefits as emergency measures.

As to the New Democracy Party I have spoken of its responsibilities and will not repeat myself.  Let it decide what stance it will take on our decisions; the assessment will come not from me, but from the Greek people.

Nor have I sought support for these specific measures from you Mrs. Papariga, nor from Mr. Karatsaferis.  I have spared you the burden, if you like, and have not tried to transfer responsibilities to where they do not directly belong.

We undertake the responsibility and the political costs. We are not deterred because we have courage, because the Parliamentary Group of Pasok and this Government have the courage to undertake their responsibilities towards the nation, towards Hellenism, in order to save the economy and the country.

We know that the measures are painful and we too felt pain when taking them.  I would have expected you to recognise that Mr. Tsipras, but I am not even demanding this.  What I am seeking, however, in this second and more crucial phase is for there to be a spirit of collaboration.

We are faced with a more important and more creative and hopeful battle.  These are the major changes that our country needs so as to never find ourselves in this position again.  This is the battle for the rule of law, so that citizens know that their rights are protected, as well as their achievements, their livelihood and their life.  For citizens to know where their money is spent and that the correct services are provided – in education, healthcare, welfare, development- whether regional, green, or substantial.

This is a battle for a state close to its citizens, a reliable health-care system, and a viable social security system, which will not do an injustice to anybody and certainly not to the forthcoming generation and to establish an educational system which finally shifts from autism to bring the pupil and the needs of society centre-stage.

We are aiming to create a public administration which helps the entrepreneur, the robust business and does not impede nor entwine them in the tentacles of bureaucracy and corruption.

We all live in this country and I am sure that deep within ourselves we know what is at fault for the major difficulties today facing our country and citizens.  That the country does not have great possibilities is not the problem.  On the contrary we live in a country which objectively speaking is blessed with great beauty and potential.

Irrespective of the negative image formed during recent years and months, we are known the world over for our history and the beauty of our country.  We are one of the top tourist destinations in the world, and the present difficulties are not due to the fact that we lack abilities or even that we have been insulted recently, with racist aspersions of being lazy.

The overwhelming majority of Greeks are honest hard-working citizens toiling daily for a better future for their children.  We work long hard hours every day to provide for ourselves and our children.

As I have said before, corruption and guile is not part of our DNA.  Greeks have distinguished themselves the world over once given an opportunity, with the right framework and correct institutions.  Suffice it for them to all have the same opportunities and not to be disappointed by any favouritism or unjust treatment.  This unprecedented crisis may be a very testing time, but we have not forgotten our commitments.  Ultimately, this is a great opportunity.

With specific action, initiatives, new laws, new structures, we can prove that we meant fully what we said before the elections.

Our pre-election promises are the solution, not the problem as some would slyly maintain.

On the contrary, the situation makes it more imperative to make those radical changes sought by the Greek people, justifiably, to which we have committed ourselves.

This is what we are doing.  I call upon you to fight this battle.  This year we will achieve our fiscal objectives, but this is not enough.  Major changes are necessary to break out of the vicious circle.

We must first reinforce the concept of equality and justice before the law and the State.  Take for example the new tax legislation.  All exceptions from the rule, privileges, and made-to-measure provisions have been abolished with the new tax legislation. People have been over-awed but re-establishing justice in this issue is paramount for a State.

Starting with ourselves, we have abolished the special tax rating for members of parliament.  This is the first substantial step in order to convince society that times have changed and we are building a new relationship of confidence, we are changing the state.

We are doing the same with the consolidation of meritocracy for recruitment, through the ASEP system.  The State will no longer pay exorbitant amounts for unnecessary recruitment for reasons of clientelism.  In this way we respect the money of the Greek people.

We are changing the model of Greek society; we are sending a clear message out to young people:  your success depends on your efforts, your worth and not through connections with parliamentary or party political offices.

We are re-instating meritocracy and the career path in the Public Administration.  This is not being done only for reasons of transparency and justice, or because of the dictates of our values. This is a pre-condition for a workable state mechanism, effective and productive which needs its best cadres in positions of responsibility, irrespective of party politics.

We are making deep changes in the structure of the state with the ‘Kallikratis’ plan.  This is not due to any fixation, but to a deep belief that the hydrocephalous state, the state modelled on clientelism needs to be hit at its very roots, and to finally perform.  Local government should provide services and be close to citizens.

We are reducing the levels of Administration and decentralising decisions.  In this way we will rationalise expenditure, merge the thousands of local government bodies, economise resources, release local development forces, speed up procedures and at the same time offer better services to citizens locally, close to home and school.

We have hit hard at the lack of transparency, so that citizens can trust the State.  All decisions will be uploaded on to the internet.  We are giving society and its citizens the right to judge and to directly monitor power, us, and how we are managing public funds.  We are drawing up three-year budgets, restricting expenditure, wastefulness and enhancing transparency.

The tax legislation to be tabled the day after tomorrow will be a true revolution compared to what we had to date.  The changes are phenomenal with decades of abuse swept aside.  Fiscal equality will be established.  All special unfair provisions for self-assessment will be abolished.

Large shareholders’ profits will be taxed in the same way as salaries and wages and not with more favourable terms, as was the case to date.

According to our election commitments, the weaker and middle class, will not be burdened further but rather will have tax relief for income up to 40.000 euros.  Small home-owners will have tax relief, though there will be a greater tax burden for owners of substantial real estate, according to the dictates of social justice we serve.  For those individuals living a life of fiscal immunity, there are difficult days ahead, but they will learn to adjust.

We are due to implement a full and radical arsenal against tax evasion, with means testing, expenditure control, control of money sources, cross-checks, strict taxation for off-shore companies, drastic measures against people robbing the state.  In the past this meant that the ‘mugs’, as they were called, people who could not hide their income paid more tax, such as workers and pensioners.

Our fiscal policy is a radical change which Greece needed decades ago and bears the seal of social justice, so that all taxpayers finally feel respected and proud ultimately of country and state.

We are radically changing the setting for development and entrepreneurship in our country, for a viable and productive economy.  As things stand today, those who are economically weak, low wage-earners, the unemployed – all find themselves in a difficult position, and our economy is not competitive  we know.

To be able to find many more opportunities, jobs and better pay, we are moving ahead with new measures, such as boosting small and medium-sized enterprises through the Guarantee Fund for Small and Very Small Enterprises (TEMPME), while accelerating and simplifying the National Strategic Reference Framework (ESPA) through legislation already tabled in Parliament.  Shortly we will submit a Bill of Law which will drastically reduce the time needed to establish a company, time usually wasted in bureaucracy as a result of corruption and kickbacks.

The greatest change however will be to move to another model of development.  A similar fast speed track will be created with legislation of renewable energy sources to attract international investment.  To conserve energy in households, hotels, public buildings and open up jobs in the construction sector, but also to reduce electricity bills for households.  It will also cover domestic waste recycling thus creating a whole new branch of industry and development.

Higher Education Technical Colleges and Universities as well as schools will become centres producing new professions where young people will be retrained to as to find jobs in green development and ‘green jobs’.  This will pervade the tourism and agricultural sectors as well.

The agricultural sector will become a profitable branch to the benefit of the farmers and those choosing to live in rural areas, changing production to value products which will be exported and not remain unsold with farmers seeking subsidies.

We know that money belonging to Greek citizens is being lost in the black hole of speculation and corruption. This is true unfortunately in the health sector, and this is unacceptable.  Here we are coming into conflict with the vested interests even now rampant and we are implementing a drastic programme to combat waste and lack of transparency, saving millions of euros of taxpayers’ money, now being swallowed up by suppliers and middlemen, in order to finally provide better services to citizens.

Information technology and computerisation covering prescriptions, hospital organisation and procurements will be enhanced, – the programmes and hardware is in place, but the political volition to fight against malpractice and vested interests was missing.

Our government is ready to fight such practices and interests to protect ordinary citizens.

Major changes are being made in education with innovatory schools which put the pupil first and enables schoolchildren to think creatively and to make use of modern technology, to innovate, to acquire modern and useful knowledge, such as of course, foreign languages, and to move away from per rote learning, learning by heart, an ossified pedagogical procedure alienating pupils from school and the learning process.  We want to shape responsible citizens who will acquire skills and abilities in a digital society, an internationalised economy and be able to deal with the true challenges o f today.

Despite the very negative financial conditions we are now, as far as possible, and  in the future taking initiatives to support the weaker and middle class

We are proceeding to paying Social Solidarity benefits to 2.5 million fellow citizens. The money came from companies with the highest profits and large property owners.

This is what we mean when we say social justice.  We will soon proceed to subsidize jobs since one of the largest problems in our society is youth unemployment.   This is why subsidising jobs and of course benefits for youth unemployment will be a relief for them.

It is first and foremost our duty to ensure during this crisis that social cohesion is maintained.

For all this, Members of the House, we are proceeding not only with consultation, but also dialogue as a basic tool to build social alliances, and to find the best, the most effective, the most innovatory, the best in terms of quality, but also cost-effective ideas and proposals so as to make use of the best potential we have both inside and outside of Greece, and bring about a true revolution in our country.

We call upon you to participate in this revolution. We know that we can, that Greece can.  We are proving this every day and we will prove it not only to Hellenism but also to all those who never believed us, jeered us, doubted us.

This is a challenge and our duty, for us, for our cadres in the Government, in the Parliamentary Group, in our Movement.

This is our challenge to contribute constructively, critically, to a new path for our country and Hellenism, and together we will succeed.

We will succeed

Thank you.