Fiscal consolidation and the real economy
Main expenditure cuts and tax measures
Major reforms adopted

2011 Budget on track
2011 Budget law
Emergency measures supporting the 2011 Budget and the Economic Policy Programme
Real estate and asset privatisation programme

• In the first half of 2010 the Greek budget deficit shrank by 45.4% year-over-year against a targeted 39.5% decline

In the second quarter of 2010 the Greek government achieved a number of structural milestones:

• Overhaul of the country’s private sector pension system to ensure its medium and long-term sustainability
• Reform of the country’s public sector pension system to bring it into line with the new private sector system and the binding decision of the European Union Court of Justice on the equalisation of retirement ages for men and women
• Establishment of a 10 billion euro Financial Stability Fund to safeguard the capital adequacy of the country’s banking system
• Establishment of a new Public Finance Management Framework for drawing up, executing and monitoring the government’s budget
• Reform of the local and regional public administration, to enhance transparency, productivity and efficiency in the local governance system
• Establishment of a Single Payment Authority for the public sector wage bill
• A number of labour market reforms to increase flexibility and competitiveness

• The Greek government has unveiled a wide-ranging privatisation programme, spanning the state’s holdings in rail, road transport, airports, ports, utilities, the gaming industry, and public real estate.

• The programme leverages private investment so as to restructure the economy, foster economic growth, contribute to fiscal consolidation and raise the overall quality of life.

• The programme puts to use the know-how of the private sector through outright sales, concession agreements, initial public offerings, strategic public-private partnerships, and the establishment of new holding companies.

• State shareholdings will range from minority stakes of less than 34%, to controlling stakes of 51% or more. In a number of cases the government will divest fully from its holdings.

• The new Economic Policy Programme will be supported with a 110 billion euro financing package provided by euro area Member States (80 billion euro) and the IMF (30 billion euro). The programme will be monitored through twelve quarterly reviews.

• The programme includes both structural and fiscal reforms that will help Greece overcome deep-rooted structural deficiencies that persist in public fiscal management, the real economy and the financial sector.

• The Greek government has proceeded decisively with the implementation of the existing Stability and Growth Programme as well as with the actions foreseen in the new programme. All fiscal measures necessary to achieve the 2010 fiscal targets have been adopted.

• Consolidation of the budget remains on track with the state budget deficit over the period January – April 2010 registering a year-over-year reduction on an accrual basis close to 42%.

• On Thursday April 15th the Greek Parliament passed the new tax Law that aims to simplify and rationalise the tax system and to introduce rules to combat tax evasion.
• The new tax Law represents a complete overhaul of the Greek tax system and makes it simpler, more stable, transparent, fair and effective in fighting tax evasion by improving auditing and exchange of information.
• With the new Law the Greek Government moves decisively to fulfil its obligations arising from the Hellenic Stability and Growth Programme and the European Council decision on fiscal and structural measures to be adopted by May 15th.

• Following an emergency Parliamentary procedure, the Greek Parliament approved on 5 March 2010 a package of additional measures designed to safeguard the achievement of the Stability and Growth Programme targets.

• The new package totals 4.8 billion Euro or 2% of the GDP and consists of permanent expenditure reducing and revenue enhancing measures.