ATHENS (Reuters) - Greece’s foreign lenders have refused to make any further concessions on changes to labour laws contested by a junior coalition partner, the country’s finance minister said on Sunday, prolonging an impasse on a crucial austerity package.
Athens has been locked in talks with its European Union and International Monetary Fund lenders on the austerity package for months, but a final agreement has been held up by the small Democratic Left party’s refusal to back the new wage laws.
The party, which says the changes undermine labour rights, has said it will vote against the measures when they are put to a parliamentary vote next week.
The party has demanded the troika of European Commission, European Central Bank and IMF lenders allow a national wage agreement to apply to all employees rather than just unionised workers. It also wants the lenders to withdraw a plan to axe the 10 percent salary hike employees get when they marry.
“The troika has not accepted the (party’s) demands,” Finance Minister Yannis Stournaras told reporters.
A government official, who declined to be named, said Athens would present the bill on labour and other measures in parliament on November 5.
Near-bankrupt Greece needs a comprehensive deal on the austerity package and reforms to unlock its next tranche of aid before it runs out of cash in mid-November. Greece’s gross public debt is equivalent to 171 percent of its economic output, according to the International Monetary Fund.
The Democratic Left party has the support of 16 deputies in the 300-seat parliament and the government - which has a 176-seat majority - could pass the package without its support.
But a vote against the package by the party would undermine the already fragile coalition and perhaps tempt other lawmakers to defect and vote against unpopular measures.
The austerity package contains spending cuts and tax measures worth 13.5 billion euros (10.8 billion pounds) as well as a long list of structural reforms to kick-start Greece’s failing economy.
Reporting by Lefteris Papadimas; Writing by Deepa Babington; Editing by Jon Hemming