Despite Brutal Cuts, Greek Pensions The EU’s Highest Ratio of GDP

FILE - An elderly man passes by homeless men in Athens. (AP Photo/Thanassis Stavrakis)

ATHENS – More than eight years of austerity that brought repeated pension cuts also saw the economy shrink some 25 percent, making the benefits the highest in the European Union as a percentage of Gross Domestic Product (GDP).

That’s before another planned slash starting next year as Prime Minister and Radical Left SYRIZA leader Alexis Tsipras agreed with international creditors, after swearing he wouldn’t and that pension cuts were a Red Line he wouldn’t step up but jumped over.

That was shown in figures released by the EU’s statistics agency Eurostat that was bad news for pensioners who can expect little sympathy from other countries where beneficiaries receive even less compared to the GDP ratio.

Greek pensioners have taken to the streets numerous times and one killed himself under a tree in Syntagma Square outside the Parliament eight years ago but after a few days of memorials, he was forgotten.

Despite that, Greece’s social security system is still struggling to sustain itself with a shrinking population and fewer people paying into the plan and companies trying to find ways to evade making contributions.

Eurostat’s figures showed that social protection spending in Greece which goes toward pensions amounted to 17.8 percent of GDP in 2015 – by far the highest in the EU, with Italy at 16.5 percent and France third at 15 percent.

The findings don’t take into account the most crucial factor: how much the beneficiaries receive in hand after a number of cuts slashed benefits 30 percent and more and has left many trying to live on incomes of as low as 380 euros ($441.21) a month.

Eurostat’s figures are related to the structure of the Greek pension system, which is distributive and not redistributive because there are too few workers paying for too many pensioners.

In the EU the average pension spending rate stood at 13 percent of GDP in 2014 – the most recent year with available data – against Greece’s 17.2 percent.