A draft omnibus bill legislating for the prior actions and milestones Greece must implement in exchange for a 1.0-billion-euro tranche of bailout loans has been tabled in Greek Parliament, following an agreement reached with Greece’s creditors late last week.
The omnibus bill was tabled on Saturday using emergency fast-track procedures and deals with the management of non-performing loans, wage issues and “other urgent legislation implementing the Fiscal Targets and Structural Reforms Agreement.” Discussion before the relevant Parliamentary committee is scheduled to begin at 2 pm on Monday afternoon, which is required to conclude its work and submit its report by 10 pm on Monday night. Discussion before the Parliamentary plenum will likewise be concluded in a single session, starting at 9:30 am on Tuesday and lasting for 10 hours.
Under the changes to the uniform public-sector wage scale, salary will no longer depend on rank and new wage scales are set according to educational level. There are 19 salary levels for staff with a university or technological college degrees and 13 salary levels for those who have completed mandatory education and high-school.
Regarding non-performing loans, the bill allows their sale and transfer but expressly forbids making the position of either the debtor or guarantor less advantageous as a result. It also makes itself temporarily inapplicable to mortgage, consumer and SME loans until February 15. This means it can only be applied to loans given to large businesses and non-consumer loans not linked to a mortgage of a primary residence. The intent is to allow time to reveal any problems that may arise in practice so that these can be corrected promptly before the law is extended to the other categories.
It also outlines the ways in which the companies acquiring the loans will be regulated and their obligations to the debtors, including a requirement that the debtor be offered a settlement by the original loan issuer at least 12 months before it is sold to third parties. This does not apply in the case of “uncooperative” debtors or when the debtor has been taken to court.
In statements on Saturday, Greek Finance Minister Euclid Tsakalotos said the aim was to pass the legislation on Tuesday night, in time for a Eurogroup Working Group (EWG) meeting on Wednesday, so that the tranche can be disbursed at the end of the week.
Regarding the new privatization fund, Tsakalotos said that the entire current privatization agency, the Hellenic Republic Asset Development Fund (HRADF) would be transferred to this, as well as the Hellenic Financial Stability Fund (HFSF), which will have a governing board that will have oversight of all categories of assets, including real estate, banks, state enterprises and assets that generated income.