“The Greek government will resign in case of a Yes-vote in the referendum”
Tuesday, 30 June 2015
Interview with Stelios Kouloglou, SYRIZA MEP.
The Greek drama is not over yet. After the break-up of the negotiations between Greece and the three creditor institutions, the Greek government announced a referendum on the 5th of July. The Greek people will be asked to vote Yes or No to the creditors’ proposal on the conditions for an extension of the bailout program. Tuesday evening the Eurogroup did not agree on granting Greece’s last-minute request for a new two-year loan to meet its debt service. That means that Greece will not be able to make a repayment to the International Monetary Fund that is due by Tuesday midnight. Only one day earlier the European Commission president Jean-Claude Juncker stated that the door is not closed yet.
We interviewed a member of the government party SYRIZA to get their version of the dramatic chain of events and its position on the proposals.
SYRIZA is represented by six MEPs in the European Parliament (EP). The party is member of the political group European United Left – Nordic Green Left. We met Stelios Kouloglou, the party’s spokesperson. A journalist by profession and TV producer of awarded documentary films, he became MEP in early 2015.
Question: Since 2011 the impression was that Greece was reforming its public sector with the assistance of the Task Force for Greece but that the austerity policy imposed on Greece prevented a recovery of the economy and caused poverty and inequality. After reading the Greek proposal and the counter proposal the perception is that almost nothing substantial happened and that the reform program has to get restarted, this time with support from OECD, the World Bank and the ILO. Do you share this assessment?
Answer: From day one the government did everything possible to promote a mutually accepted agreement with our partners. However, that was not the case on the other side. The institutions asked us to sign another package that is harsher than the previous ones that resulted in disaster.
Q: In the beginning of last week the only cloud in the sky were concerns that the more radical wing in SYRIZA would vote against the forthcoming deal in the parliament. Were you in the SYRIZA group in the European Parliament also divided or do you share a common position and analysis of the Greek proposal and the counter proposal?
A: The SYRIZA group in the EP stands united behind the common position of the Greek proposal. For those members who voice a different opinion, either in the Greek Parliament or in the EP, we hold the opinion that freedom of expression is necessary for a modern party.
Q: What really happened during the week? Why did the Greek government walk out from the negotiations and adopt the position of the internal critics in the party, although it seemed that the gap between Greek proposal and the creditors’ counterproposal had been narrowed?
A: The proposals suggested by the institutions would result in a slow death for the Greek economy. We proposed a deal giving the same financial results. However, it was rejected because the real purpose of the creditors was to humiliate and overthrow the Greek government.
Q: What is the logic behind the referendum on 5 July? Will the government resign if the Greek people says “yes” to a deal, as the polls indicate will happen, or will the government stay in power and implement a deal that they have rejected and called an ultimatum?
A: The expression of the people’s will through the use of referendums is not a new phenomenon in Europe. To mention just a few, the referendum of the Maastricht Treaty, the treaty of Lisbon and the European Constitution are some of them. We want a “no”, not to exit the Eurozone as the creditors claim, but to negotiate a better deal within the Eurozone. If the outcome of the referendum is in favor of “yes”, the Greek government will respect the mandate of the Greek people and will resign because it cannot implement such a catastrophic program.
Q: How are the Eurogroup and EU as a whole supposed to trust that the Greek government will implement the commitments in a deal after its behavior in the negotiations – first sending the proposals in the last minute and then suddenly walking out?
A: We walked out because they forced us to do so. This catastrophic proposition had been presented in a “take it or leave it” way.
In order to fulfill the mandate that it was assigned, the Greek government has negotiated under very severe terms unprecedented for any other country. Thus far, the Greek government has made an honest and real effort to negotiate with determination and dignity. We have remained unwavering on the principle of mutual respect and this we’ll continue to do until the end of the meetings.
Q: The last version of the Greek proposal and the creditors’ counterproposal look very much the same to me. Which are the remaining sticking points which need to be agreed upon? Which elements in the counter proposal would you consider as austerity policy?
A: Some of the remaining sticking points can be summed up as follows:
a) The reduction in the main and supplementary pensions b) A dramatic increase of VAT for hotels and catering from 6.5% to 23% that will destroy the tourism industry c) 100% advanced corporate taxation for next year that will destroy small and medium sized enterprises (SME) and even large enterprises; and this proposal comes from pro-enterprise people.
Q: The counterproposal includes a measure on “increasing the rate of the tonnage tax and phasing out special tax treatments of the shipping industry”, however without any details. Do you agree that special tax treatment for vested interests damage tax compliance in general?
A: We are against “special tax treatment for vested interests” and against tax evasion. We want to drastically change this but we need some time. You cannot carry out reforms while being under constant daily pressure.
Q: Pension reform is one of the most important issues in the proposals. Both sides agree that the current system isn’t sustainable and that the lenient rules on early retirement should be phased out. Aren’t the remaining differences only technical details?
A: The creditors´ proposal includes phasing out the “solidarity grant”. Mr Juncker refuses to confirm this fact. That means people’s pensions will be reduced for example from 700 euros to 500 euros per month. They also want to increase the health contributions for pensioners from 4% to 6% on average and extend it to supplementary pensions and ensure that all supplementary pension funds are only financed by “own contributions”, something that will result in huge supplementary pension reductions.
We want a more gradual and socially just approach that will protect the poor and vulnerable people.
Q: What will happen now? Will Greece return to the negotiation table before it’s too late?
A: We want to negotiate even now and reach a final sustainable agreement that will benefit both sides.