German Finance Minister Warns No Reneging On Greek Pension Cuts

Αssociated Press

FILE - Greek Finance Minister Euclid Tsakalotos, right, speaks with European Commissioner for Economic and Financial Affairs Pierre Moscovici, center, and German Finance Minister Olaf Scholz during a meeting of eurogroup finance ministers at EU headquarters in Luxembourg on Thursday, June 21, 2018. (AP Photo/Virginia Mayo)

Prime Minister and Radical Left SYRIZA leader Alexis Tsipras will have to stick to reforms and austerity with the end of three international bailouts of 326 billion euros ($378.44 billion) on Aug. 20, German Finance Minister Olaf Scholz said.

Germany and its banks are the biggest contributors to the rescue packages and have made a killing in profits and Chancellor Angela Merkel insisted on, and got, harsh austerity measures in return.

In an interview with the Greek newspaper Ta Nea, he said Tsipras won’t be able to wiggle out of another round of pension cuts scheduled for Jan. 1, 2019, with elections required to be held by October, 2019 and SYRIZA far behind the party it unseated in 2015, the New Democracy Conservatives. Tsipras agreed to the pension cuts, as well as new taxes in 2020 on previously-exempt middle-and-low-income individuals and families, to get a third bailout, this one for 86 billion euros ($99.84 billion) he said he would never seek nor accept but did both.

Some one-third of pensioners will see their benefits cut again, about half will stay the same and 20 percent may see hikes although successive rounds of slashes have reduced some payments nearly in half since 2010.

Scholz said that Greece has to adhere to the terms of the memorandum Tsipras’ government after swearing to tear up two previous agreements and not seek another, nor impose more austerity.

"Agreements must be met,"he said, adding: "It is a basis for investors and businesspeople to restore their confidence in Greece and invest in the country ... agreements are significant so that the country enters a course for viable growth, and for the debt's sustainability to be guaranteed."