VZCZCXYZ0004
PP RUEHWEB

DE RUEHTH #0433 0801534
ZNR UUUUU ZZH(CCY AD7345BF UTS6600-695)
P 201534Z MAR 08
FM AMEMBASSY ATHENS
TO RUEHC/SECSTATE WASHDC PRIORITY 1504
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE

UNCLAS ATHENS 000433 
 
SIPDIS 
 
SENSITIVE 
SIPDIS 
 
C O R R E C T E D COPY LAST LINE OF TEXT 
 
E.O. 12958: N/A 
TAGS: PGOV PREL ELAB ECON SOCI GR
SUBJECT: STRIKES BRING GREECE TO STAND STILL - SOCIAL 
SECURITY REFORM ON TRACK 
REF: ATHENS 400 
 
SENSITIVE BUT UNCLASSIFIED -- PROTECT ACCORDINGLY 
 
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SUMMARY 
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¶1.  (SBU) Private and public sector unions continued their 
ongoing strike against government-sponsored social security 
reforms today, a situation which has essentially brought 
most of the country to a stand still.  Professionals from 
the ranks of lawyers, doctors, engineers, and teachers 
joined electricity workers in the protest against the 
government's pension reform bill intended to streamline a 
fragmented and deficit-ridden system.  Demonstrations will 
culminate at the Parliament tonight, March 20, when the 
government's bill on social security reform is expected to 
pass.  While passage represents a government success over 
the stalwart unions, this is but one battle in a war to 
liberalize Greece's economy.  End Summary. 
 
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Strikes Bring Greece To A Stand Still 
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¶2.  (U) Unions announced a 24-hour nationwide general 
strike for March 19, 2008, effectively paralyzing the 
country; most unions continued the strike on March 20, in 
light of the planned government vote on social security 
reform that day.  Electricity workers continued their 
strike for the second week, joined by lawyers, doctors, 
engineers, teachers, and other professionals on March 17. 
Unions organized a rally at central Athens on March 19 and 
will demonstrate at the Parliament on March 20.  The 
country continues to be plagued by electricity 
interruptions, remaining piles of garbage (sanitation 
workers returned to work Monday after more than a week on 
strike), limited banking operations, and serious 
transportation woes.  Strikes are expected to dwindle after 
March 20, when the social security bill is expected to pass 
in Parliament.  With opposition parties and unions refusing 
to enter into a dialogue with the government on this issue, 
the bill is expected to pass without significant challenge 
or revision.  The opposition and unions continue to demand 
the government withdraw the bill. 
 
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Social Security Reform Touches All 
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¶3.  (U) The social security reform bill seeks to streamline 
Greece's fragmented and deficit-ridden pension system by 
slashing Greece's 133 pension, health and provident funds 
now overseen by the labor ministry for private sector 
workers to just 13 umbrella funds; it raises the effective 
retirement age for women and working mothers; uses 
incentives and disincentives to keep employees working 
longer; establishes a new super-fund to help cover the 
pension needs of workers retiring after 2019, and caps the 
payouts of so-called supplementary pensions that retirees 
collect over and above their main pensions.   The plan also 
proposes several secondary reforms aimed at further 
improving the functioning of the system, such as the 
introduction of a single pension and health care 
identification number, to be brought in by mid-2009.  At 
the end of the day, the measures will affect the vast 
majority of Greece's professionals and private and public 
sector workers. 
 
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Comment 
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¶4.  (SBU) Although the strikes witnessed an unparalleled 
level of participation and managed to bring the country to 
a stand still, unions appear to be unable to break the 
government's will and block passage of the social security 
reform bill.   However, workers and professionals appear 
convinced that very soon they will see their social 
security perks diminished or eliminated.  Recent opinion 
polls indicated that 71 percent of those questioned opposed 
the reforms and 69 percent supported the strikes.  If the 
government does not proceed with additional economic 
liberalization reforms and take measures to reverse the 
negative climate, its likely social security reform bill 
triumph could become a pyrrhic victory. 
SPECKHARD