Greek parliament to vote on new austerity package

Saturday, February 11, 2012 - 09:12 AM

Greece is a step closer to getting a new €130bn bailout after its cabinet signed off on a fresh dose of austerity measures last night.

All eyes are now on the Greek parliament, which is due to vote on the deeply unpopular bill tomorrow.

The draft proposal must also be approved by European finance ministers.

The EU will only agree to release the aid if Greece accepts a further €325m in spending cuts and gives clear commitments to implement reforms.

Five ministers in Greece resigned yesterday - including the Deputy Foreign Minister - over the spending cuts, which include firing thousands of civil servants and slashing the minimum wage.

Greece’s prime minister Lucas Papademos told ministers the measures were vital to avoid a default that would cost Greece its place in the eurozone and provoke “economic chaos and social explosion”.

Mr Papademos promised to ``do everything necessary'' to ensure parliament passes the new austerity measures that would slap Greeks with a minimum wage cut during a fifth year of recession.

He also promised to replace any other Cabinet members who did not fully back his efforts.

“It is absolutely necessary to complete the effort that began almost two years to consolidate public finances, restore competitiveness and economic recovery,” Mr Papademos told an emergency Cabinet meeting.

Draft legislation for the new austerity measures was submitted to parliament after the five-hour meeting ended.

In central Athens, clashes erupted outside Parliament between dozens of hooded youths and police in riot gear. Police said eight officers and two members of the public were injured, while six suspected rioters were arrested.

The violence broke as more than 15,000 people took to the streets of the capital after unions launched a two-day general strike that disrupted transport and other public services and left state hospitals running on emergency staff.

Scores of youths, some in gas masks, used sledge hammers to smash up marble paving stones in Athens’ main Syntagma Square before hurling the rubble at riot police.