Wednesday, February 16, 2011

Greece Passes Athens Transport-Sector Reform Amid Protracted Strikes

ATHENS (Dow Jones)--Greece's socialist government was able to pass its sweeping Attica public transportation reform legislation in a final vote two hours past midnight on Wednesday, despite protracted strikes since December.
The reform of the heavily indebted and loss-making state-owned transport enterprise of the greater Athens region is one of the demands made by the International Monetary Fund and European Union in exchange for Greece's drawing on the EUR110 billion bailout in order to avoid sovereign debt default.
"The law will create a metropolitan authority to oversee the Athens public transport system, and we will consolidate five entities into two to reap economies of scale. We are also imposing requirements for a business plan and regular audits to prevent deficits accumulating which are then picked up by the Greek taxpayer," Transport Minister Dimities Reppas said.
The ruling Pasok party used its 156-member majority, out of a total of 300 seats in parliament, to pass the controversial law.
The minister said the Attica public transport enterprises have combined total debts of EUR3.8 billion, and the government subsidizes up to 70% of operating costs. He added that wage costs have jumped 43% between 2004 to the end of 2009.
Earlier Tuesday, thousands of public transport workers walked off the job in a 24-hour strike that suspended bus, trolley, urban rail and subway services. The walkout again disrupted commutes and snarled traffic, particularly during the morning and afternoon rush hours.
Since early December, commuters in the Greek capital have struggled with almost daily walkouts by transit workers, including five 24-hour strikes.
According to the government, Athens' urban transit companies reported combined losses of EUR472 million in 2009, which narrowed to EUR390 million last year due to steep cuts in wages and bonus payments.
Under its reform plan, the government hopes to narrow that deficit to about EUR150 million next year through further cuts in worker bonuses, streamlining administration, and transferring some 1,500 employees out of 11,850 currently to other jobs in the public sector.
The legislation also imposes a 30% hike in ticket prices and a renegotiation of the collective-wage agreements for transit workers.
Over the last few months, in a response to a raft of austerity measures imposed by Greece's international lenders, some commuters have launched a protest movement by refusing to pay for the use public transportation.
The Transport Ministry said that stiffer penalties and fines will be introduced for fare beaters because one portion of the population cannot shirk responsibility and shift the burden of lost revenue onto paying commuters.

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