Auditors resume talks with Greek ministers

Top officials from Greece's international creditors were meeting Saturday with Greek ministers to discuss a measure to shrink the swollen public sector by partially laying off civil servants. Finance Minister Evangelos Venizelos and Administrative Reform Minister Dimitris Reppas met auditors from the EU, the International Monetary Fund and the European Central Bank, who have to determine whether Athens qualifies for another slice of bail-out cash. Greece is racing against the clock to finalise a scheme that seeks to place 30,000 civil servants temporarily in a "labour reserve", in order to meet fiscal requirements set out by the creditors for 2011 and 2012. The auditors are pressing for reduction of the public sector, but the government faces a major obstacle as the Greek constitution protects civil servants from dismissal. One possibility is scrapping various state organisations and placing their employees in the labour reserve, to avoid constitutional revision. Civil servants close to the retirement age would also be placed in the reserve on a reduced wage, but the daily Kathimerini said Saturday the idea had been rejected by the auditors. Assuming the problems can be thrashed out in Saturday's talks, the issue will be taken to an emergency cabinet meeting Sunday chaired by Prime Minister George Papandreou, where the draft 2012 state budget will also be on the agenda. The auditors returned to Athens on Thursday, four weeks after they abruptly left, having noticed new spending discrepancies by the Greek government and disappointed at the lack of progress in implementing promised structural reform measures. Friday's meetings between the auditors and the ministers were delayed and then moved to secret locations after dozens of civil servants, protesting cuts in public services, blocked off several ministries. The Hellenic Statistical Authority (ELSTAT) postponed the publication of two sets of economic indicators on Friday after employees of the agency were barred from entering their building. The debt-hit nation, sinking deeper into recession, must persuade the audit mission that its reform plans are credible to merit a vital tranche of eight billion euros ($10.8 billion) from the 110-billion-euro loan agreed with the European Union and the IMFund in May 2010. The report from the EU-IMF-ECB mission will determine if Greece will receive this next tranche of debt aid and again escape default.