Possible delays in the disbursement of bailout money

European Union officials on Monday appeared to dismiss Greece’s refusal to implement some of these changes, saying that these are issues that have already been agreed with the Greek government.

Increases in the top rate of VAT from 23 to 24% and of social security contributions are to be implemented as of tomorrow June 1st.

In comments on Monday, German Finance Minister Wolfgang Schaeuble described the decision to raise value-added tax in Greece as “economic foolishness” but noted that Athens was obliged to take that route due to a revenue shortfall.

On security funds, the Greek government has not resolved the issue of supplementary pension (EKAS) to about 100,000 pensioners who don’t fulfill the criteria to receive it. Lenders ask the supplementary pensions to be returned to the state retroactively.

Athens has not legislated on the issue yet and creditors expect it to be resolved as a condition for the tranche disbursement. Greece has proposed alternative measures to close the EKAS gap but they haven’t been specific yet.

Lenders also disagree on certain tax deductions for freelancers and security fund contributions to businesses operating in areas with less than 2,000 inhabitants.

The competent labor ministry insists that no changes will be made to those legislated and that ultimately the beneficiaries of EKAS.
The issue of non performing loans that are guaranteed by the State is another thorny issue that has the two sides crossing swords. Lenders insist that non performing mortgages of primary residences of 140,000 and up should be negotiated with distress funds without exceptions.