Prime Minister Kyriakos Mitsotakis effectively launched the 86th Thessaloniki International Fair (Sep.10-18) with his speech at the ‘Ioannis Vellidis’ Congress Centre on Saturday night.
The Greek Premier announced a 5.5 bln euros package of 21 extraordinary and permanent measures that “do not throw off the fiscal balance,” and which will be rolled out at three specific points in time: “eight support measures for immediate implementation by the end of 2022; another 12 major and permanent changes, to be activated at the beginning of 2023, and to be integrated in the state budget that we will vote at the end of the year; and a six-point plan that answers a big problem – that of housing – especially for young people, to be implemented immediately.”
Measures effective immediately
– A 250-euro cash aid will be paid out in December to some 2.3 mln vulnerable citizens: low-income pensioners, uninsured seniors, people with disabilities and the long-term unemployed. Beneficiaries of the minimum guaranteed income will collect one more monthly installment, while beneficiaries of child benefits will collect one-and-a-half monthly installments.
– Student housing allowance is immediately increased from 1,000 to 1,500 euros. In addition, the allowance increases to 2,000 euros per person for eligible students who decide to live together in the same rented residence.
– Heating allowance has so far increased from 84 mln euros last year to 174 mln, and now it will reach 300 mln euros, with criteria being broadened to provide relief to around 1.3 million households. Moreover, the allowance will be doubled for the first time this year for beneficiaries who use oil or other forms of fuel except natural gas. He called this particular measure “a strong incentive to replace electricity or natural gas with other forms of heating, where this is feasible. Another extra intervention, he said, that will reduce the cost of heating oil for everyone will be announced soon.
– A subsidy of 60 mln euros will be paid to farmers against the cost of fertilizers, while 50,000 livestock farmers will receive 89 mln euros to cope with increased animal feed prices.
– Beneficiaries of the ‘Recycle & Change Electrical Device’ program are now increasing by 200,000, with the allocation of 140 mln euros from the Public Investment Program.
– Securing the necessary space in the power grid so that it can no longer accept electricity for consumption by individual producers, by financing 250,000 small solar panels on residential roofs, in businesses, in farms, which will consume their own energy – for free. This program will soon be announced by the ministries of energy and of development.
– Providing additional incentives to extend the tourist season through the expansion of the ‘Tourism for All’ program to cover another 200,000 new beneficiaries; extending the tourist season into the winter by approving additional funds, allocated so that Greece can be advertised in sync with the Greek National Tourism Organization (GNTO), with airlines and with tour operators, all the way until March 2023.
– Meeting the demands of Armed Forces staff, to be settled immediately, including more wages for long-term volunteers and short-term reassignment soldiers; extending 5-year contracts and over-night compensations, and instituting additional pay for warship crews on duty.
– Becoming effective immediately until the end of 2023, all companies that convert part-time employee contracts to permanent ones will be exempted from 40% of the insurance contributions of those employees.
– Startups and small businesses planning new hirings will not pay a startup fee in that year, granted only under condition that they increase their average annual number of full-time employees.
Measures effective by year’s end
– The temporary reduction of social insurance contributions by 3 percentage points now becomes permanent, increasing the disposable income of some 2,2 mln workers, while reducing the wage burden for businesses.
– The Special Solidarity Contribution tax is abolished forever and for everyone, including public and private employees and pensioners, relieving some 3 mln taxpayers.
– In the public sector, the non-remunerative contribution tax in favor of the so-called ‘former civil servants welfare fund’ is also permanently abolished. This translates to a pay increase of 364 euros for a head of a state department, 109 euros for a newly hired low-rank employee, 591 euros for a manager and 1,125 euros for a general director.
– The pensions of some 1,500,000 pensioners are to be raised, with this additional amount to come by averaging a 50% increase in GDP and by a 50% from the change in the Consumer Price Index; this is estimated at slightly over 6% for the current year.
– The special payroll of the 20,000 doctors in Greece’s National Health Service (NHS) is reformed as of January 1, 2023, with an increase in the basic salary and also in special liability compensations. The increase will average at around 10% of their total salary.
– Reforming the payroll of almost 600,000 civil servants also begins, with an emphasis on low-wage earners and also on those who hold higher positions. This will most likely come into effect as of January 1, 2024, it was noted.
– The maternity allowance in the private sector is immediately extended from 6 to 9 months.
– The reduced VAT on transport, coffee and non-alcoholic drinks is extended until June 2023, with the same policy to apply to culture and tourism sites entrance fees, gyms and dance schools.
– The 24% VAT on new buildings remains suspended until the end of 2024 to support the construction industry.
– The operating framework of the Greek Capital Market is to be reformed with important investment and tax incentives.
– State-funded local government financial resources will be boosted by 120 mln euros annually as of January 1, 2023.
– Minimum wage is to increase as of May 1, 2023, pending the completion of the modification process in due time. Two lesser minimum wage increases have already been legislated since 2019.
Mitsotakis then announced several support measures for the housing of young people and university students, “launching a 1.8 bln euros program that will target over 100,000 beneficiaries with a series of initiatives to help them buy or rent a cheaper home,” coming into effect gradually as of October.
The most key of these measures are:
– Increasing the student accommodation allowance from 1,000 to 1,500 euros – and conditionally up to 2,000 euros for 50,000 young people; this includes the construction of 8,150 spots in five modern student halls of residence at the Universities of Crete, Thessaly, Western Macedonia, Thrace and Western Attica, to begin immediately; sites have already been finalized and construction will be carried out through the collaboration of both the public and private sectors (PPPs)
– Launching a special loan program with an initial amount of 500 mln euros, with co-financing of 375 mln from the state and 125 mln from banks, in view of securing a very low, near-zero interest rate for the purchase of a first home by citizens up to 39 years old. Practically, was noted, a young couple can buy a house worth 100,000 euros with monthly installments of 275 euros, a lesser amount than most current monthly rent rates.
Mitsotakis then said that “Moscow wants to turn energy insecurity into political instability.” As of October, he mentioned, incentives and counter-incentives will be announced for energy-saving and special provisions for households using natural gas.
The prime minister did note that all the measures he announced at TIF 2022 do not include the monthly electricity costs subsidy for all citizens, and are on top of the almost 50 bln euros that his government has already made available in recent successive crises. “A safety net for society, of which the foundations are being laid for a better future, with three objectives in mind: relief for citizens – sustaining of jobs – business stimulation.”
Regarding the case of the tracking of PASOK-KINAL leader Nikos Androulakis’s mobile phone, Mitsotakis pointed out that “it was an operational error, for which the government immediately assumed the objective political responsibility.” Moreover, he added that following this incident the government legislated additional judicial guarantees in the monitoring of the country’s National Intelligence Service (EYP), while also submitting specific proposals for changes in its operation.
But he did also underline that EYP’s operation “always was, is, and will be even more valuable in the coming era. Its operation must be improved – not bogged down, and to be corrected – not voied. This, I have a national duty not to allow. Just as we should not allow current issues to be entrapped in introversion, in rumors, and in [conspiratorial] ‘scenarios’. Especially when something like this would actually be desired by many forces outside of Greece,” he stressed.
NO to Erdogan
Regarding Greece-Turkey relations, the prime minister referred to Turkish President Recep Tayyip Erdogan, for whom he said that “the threats that come from the other side of the Aegean can be answered with one word, one that sums up our nation’s entire strength: No, Mr. Erdogan, no more swashbuckling against Greece.”
At this point, attendees erupted into a standing ovation.
Concerning Greece’s partners and alliances, Mitsotakis said that “it now has several more allies, as it has signed many collaboration agreements with countries in the Western world, in Africa, in the Arab world and also in Asia.” Among these, he said, “are strategic and defence agreements, of which the most significant are with the US and France.”
As far as national elections are concerned, which are due to be held at the end of his government’s four-year term in 2023, Mitsotakis appeared adamant that these will be held on time, despite pressure from the opposition to preceed with them earlier.
Referring to TIF’s hosting city, Thessaloniki, the premier said that his government has paved the way for several public infrastructural works which, as he said, “already have and will change Thessaloniki’s image and function, making it a protagonist: its airport is ready, its new metro network will open to the public by the end of 2023, its coastal zone is being redeveloped (…), while its new orbital ‘fly-over’ motorway is also another key project.”
The city will also expand further to the west, he noted; a new children’s hospital and a new oncological hospital have also been finalized, as has the redeveloping of the military camps of Melas and Gonos, the latter of which is destined to be a logistics center. Mitsotakis also mentioned the new stadiums of the city’s PAOK and ARIS sports teams, and the new Holocaust Museum.
The premier pointed out that “the national stake, which continues to pervade time, remains the same: that through ever-changing conditions the homeland stays free, sovereign and independent, and its citizens prosper, breathing the air of a democracy that protects them and provides them with opportunities to create more for themselves and for their families.”
“Division and demagoguery only breed defeat, while unity and truth only lead to victories,” he underlined, and he noted that after 12 years of memoranda, Greece has now regained its economic autonomy from European financial supervision, while it plays a leading role in development and exports.”