Performance in the economy “they allow us to converge more quickly with the European average, so that we can more quickly cover the lost ground of the crisis we went through in the last decade, but also reduce the public debt more quickly. This policy of ours is paying off and is going to continue, as it serves to maintain fiscal responsibility and strengthen social cohesion.”

This is what he points out with his exclusive statement to APE-MPE o Minister of National Economy and Finance Kostis Hatzidakiscommenting, among other things, on the new fiscal rules that will be in place from now on, with a focus on reducing spending.

According to the minister, “the formulation of the new fiscal rules it was the result of a long, complex and difficult negotiation, where the Greek government participated in an active and substantial way. The policy we have followed in recent years serves to combine fiscal discipline with social sensitivity. And this policy has already recorded a significant amount of positive results. Performances, such as five times the growth rates compared to the European average, the reduction of unemployment, the strengthening of wages, the large increase in exports, and the attraction of more investments.

And he adds, telling APE-MPE, that “performances like these allow us to converge faster with the European average, so that we can more quickly cover the lost ground of the crisis we went through in the last decade, but also reduce the public debt faster. This policy of ours is paying off and is going to continue as it serves to maintain fiscal responsibility and strengthen social cohesion”.

According to information from economic agents, in addition to the 880 million euros for additional measures to boost citizens’ incomes and further reduce burdens for 2025, as foreseen in the Stability Program of April, it is possible, due to the positive performance in the budget, to create until the end of the year additional fiscal space, amounting to approximately 350 million euros. In this case, the amount is primarily to be used to further strengthen social cohesion.

It is noted that the additional measures to boost citizens’ incomes and further reduce burdens for 2025, amounting to 880 million euros, concern:

  • In the reduction of insurance contributions by 0.5%, costing 225 million euros.
  • In the reduction, essentially abolition, of the pretension fee for professionals, costing 120 million euros.
  • In the permanent return of the Special Consumption Tax (SCT) to farmers, costing 100 million euros.
  • In the increase of the student housing allowance (15 million euros).
  • The increase in pensions, which based on the well-known mathematical formula, is estimated to be around 400 million euros.
  • In the suspension of VAT on buildings, costing 20 million euros.

About them new fiscal rules, as pointed out by officials of the Ministry of Finance, the net primary expenditure targets sent by the European Commission to Greece based on the new fiscal framework, foresee a maximum allowed annual increase in net primary expenditure in the region of 3% (on average) per year for the period 2025- 2028. It is noted that the corresponding target for 2024 was 2.6%.

The objectives of achieving net primary costs will be finalized after a technical dialogue with the European Commission and will be integrated into the Medium-Term Fiscal-Structural Program that will be submitted by Greece to the Commission in the autumn.

Overall, the specific factors comment, the above objectives are compatible with the planning of the fiscal policy for the coming years and reflect the significant progress that Greece has achieved in all the variables that determine the sustainability of the public debt: It is characteristic that the interval that followed the outbreak of the pandemic (i.e. the three-year period 2021-2023), the debt-to-GDP ratio in Greece showed a reduction that is a record in the history of the eurozone. At the same time, the country has returned to a healthy primary surplus, has regained investment grade thus significantly reducing the cost of public borrowing, and is showing a growth rate significantly higher than the European average.