ATHENS (Reuters) - Greece’s statistics chief will testify next month in a criminal investigation into allegations that his office falsified the budget deficit to make the country’s financial crisis look worse, court officials said Monday.
The head of the newly independent statistics service ELSTAT, Andreas Georgiou, denied any wrongdoing and has not been charged with any offence in the investigation, stemming from allegations made by a former ELSTAT board member.
Georgiou and court sources said he had been asked to provide evidence on December 12 as a suspect in the probe that could prompt charges of “breach of faith” if the state is proved to have suffered damages by his actions.
“It is an unprecedented case of statisticians being investigated for producing figures under EU regulations,” he told Reuters. “Any attempt to manage statistics in the national interest is a recipe for disaster.”
In 2010, Greece overhauled its discredited statistics service by making it independent of political influence and appointing Georgiou, an IMF statistics veteran, to its helm.
The European Union demanded that Greece put an end to the release of flawed economic data after frequent revisions since joining the euro zone in 2001 had infuriated partners.
But trouble hit the service in September when a former ELSTAT board member said shortly after she was dismissed that 2009 deficit data had been artificially inflated.
The revision of Greece’s 2009 budget deficit to 15.4 from 13.6 percent of gross domestic product in November 2010 showed the country’s fiscal woes were even worse than previously thought and sped up the debt crisis which is still rocking the euro zone.
“The 2009 deficit was artificially inflated to show that the country had the biggest fiscal shortfall in all of Europe, even higher than Ireland’s which was 14 percent,” former ELSTAT board member Zoe Georganta was quoted as saying by the Eleftherotypia newspaper.
Georganta told Greek media the inclusion of a number of utilities under general government data inflated the deficit and that this was done under German pressure to justify harsh austerity measures.
Government officials at the time denied the charge and said the revision was done in close cooperation with Eurostat but the accusation prompted a criminal probe by the public prosecutor.
“It is procedural to invite the persons mentioned in the allegations to testify as suspects but it does not mean charges will be brought against them,” said a court official who requested anonymity.
If charges of breach of faith - a crime that usually applies to those who embezzle or misuse public funds - are brought against ELSTAT staff, they could face at least five years in jail if convicted.
“These allegations are very serious,” Georgiou said. “We have followed EU regulations. The statistics we have been accused of ‘cooking’ are the ones that did not receive any reservations from Eurostat.”
Reporting by Dina Kyriakidou; Editing by Andrew Heavens