Greek PM says budget surplus tops forecast, allows spending

ATHENS Sat Feb 15, 2014 12:16pm EST

Greek Prime Minister Antonis Samaras attends a news conference after a debate on the program of Greece's presidency of the EU for the next six months at the European Parliament in Strasbourg, January 15, 2014. REUTERS/Christian Hartmann

Greek Prime Minister Antonis Samaras attends a news conference after a debate on the program of Greece's presidency of the EU for the next six months at the European Parliament in Strasbourg, January 15, 2014.

Credit: Reuters/Christian Hartmann

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ATHENS (Reuters) - Greece's primary budget surplus has exceeded expectations and will allow the government to boost social spending on austerity-hit citizens, Prime Minister Antonis Samaras told a newspaper.

The primary budget surplus for 2013, which excludes interest payments and other one-off items, has come in at over 1.5 billion euros ($2.1 billion), much higher than initial estimates and targets set by the debt-laden country's international lenders, the European Union and the International Monetary Fund.

"The primary budget surplus is much higher than we had initially estimated ... I am telling you now that it exceeds 1.5 billion euros, three times as big as we initially calculated," Samaras said in an interview published in Sunday's edition of To Vima, which hit newsstands on Saturday evening.

A primary surplus is a key condition set by the lenders to grant the country the additional debt relief it needs to make it sustainable. Under the terms of its 240 billion euro bailout, Greece was supposed to reach a surplus this year.

But Athens says it reached a surplus as early as 2013, one year ahead of schedule. Back in October, the government estimated the full-year 2013 surplus at 344 million euros.

Samaras reiterated on Saturday he would use that surplus to alleviate the plight of those hurt by austerity. "This means that we will refund a very large amount to society this year, for example to low-income pensioners and law enforcement officials," he told the newspaper.

The bailout's terms allow Athens to retain and spend as it wishes 70 percent of any excess primary surplus above its targets.

Samaras' fragile coalition government is trailing the anti-bailout leftist Syriza party in the polls and faces crucial, twin municipal and European elections in May. A bad showing in the vote could destabilize his government, which has a paper-thin three-seat majority in parliament.

But EU officials warned last week that any estimate about the size of the expected surplus is premature until April, when the EU's statistics agency Eurostat will officially sign off on the country's budget figures.

"It is very astonishing to have an opinion on the surplus that early in the year," a senior EU official told reporters on condition of anonymity.

($1 = 0.7307 euros)

(Reporting by Harry Papachristou and Martin Santa; Editing by Kevin Liffey and David Evans)

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Comments (5)
gregbrew56 wrote:
Does the term “rainy day fund” have any meaning in the Euro zone?

Feb 15, 2014 1:15pm EST  --  Report as abuse
xanaduflow wrote:
It’s a debtor’s mentality to spend on a current account surplus. It seems that there is no “sound” fiscal policy in place to ensure the present and future interest of the people in this region besides a stimulus to create more spending on their end.

Feb 15, 2014 1:43pm EST  --  Report as abuse
Harry079 wrote:
When you kill off a percentage of your population that was a drain on your budget sooner or later you do end up with a surplus.

You can’t give benefits to the dead.

Feb 15, 2014 1:58pm EST  --  Report as abuse
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