July 8, 2010 / 6:03 PM / in 9 years

Greece approves pension reform amid protests

ATHENS (Reuters) - Greek lawmakers approved sweeping pension reforms on Thursday as part of measures aimed at pulling the troubled euro zone nation out of a debt crisis, while thousands of striking workers took to the streets.

About 12,000 people beating drums, blowing whistles and holding banners reading “Enough is enough” marched peacefully to parliament to protest against the cuts in pension benefits and an increase in the retirement age to 65 for all Greeks.

Prime Minister George Papandreou’s socialist government easily passed the bill, which is key to a 110 billion euro ($138 billion) EU/IMF bailout and seen by experts as necessary to rescue a doomed social security system.

“The social security reform is historic,” Finance Minister George Papaconstantinou told parliament. “It is a right and just reform which makes the system more fair for workers.”

The thousands of angry Greeks took to the streets earlier to urge lawmakers to vote against the drastic pension reform, but a low turnout offered a sign of growing weariness with anti-austerity protests.

“It’s horrible. We paid all our contributions and we are not going to get anything,” said private sector worker Vaso Spoulou, 54, who filed a request for early retirement fearing the reform would cut her pension. “They are destroying everything.”

DISRUPTIVE STRIKES

Flights to and from Greece were disrupted throughout the day, ferries remained tied up at ports, public transport was frozen and public offices were shut as unions staged their sixth 24-hour strike this year against austerity.

The turnout for the march was roughly the same as in an anti-austerity protest last week but much smaller than the 50,000 who assembled on May 5 for the biggest protest this year.

Many are angry with the prospect of working longer for a smaller pension, particularly women who could retire as young as 55 under the previous system. The reform comes on top of tens of billions of euros in austerity steps.

The legislation is seen by analysts as a major test of the government’s ability to push through structural reforms in the face of social pressure.

Despite grumblings in the ruling socialist party ranks, there was no dissent on contentious articles voted by name among the 157 socialist deputies in the 300-seat house. The bulk of the bill was approved by block vote.

Analysts said a mood of resignation after a spate of strikes, fear of violence and some acceptance of belt-tightening has kept people away from protests. But more people may take to the streets after the summer as recession, tax increases and public wage cuts are felt harder.

“People have somehow accepted the situation ... The huge majority believes the measures are absolutely unfair but almost 50 percent think they are necessary,” said Costas Panagopoulos, head of ALCO pollster.

But he warned that the government must quickly offer proof that sacrifices were paying off and peoples’ daily lives were improving, a huge challenge in an economy in recession.

The pension bill also incorporates clauses that make it easier and cheaper to fire workers and allow firms to pay young first hires less than the minimum wage.

“Young people who have just started working have no hope,” said 24-year old unemployed protester Melina Panagiotidou.

Greece’s private and public sector unions represent about 2.5 million workers, or half the country’s workforce. Their repeated strikes and protests have hit tourism, a vital sector for the Mediterranean country.

“Workers will keep fighting even after the pension reform is voted on, to make sure it stays only on paper,” Ilias Vrettakos, vice-president of public labor union ADEDY told Reuters.

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